Legal Checklist for the First 90 Days of an LLC Startup
What every new founder should handle early (before it becomes expensive)
Launching an LLC is exciting, but many founders are not aware of what legal steps they need to take at the formation of their startup. This checklist will walk you through the key legal steps when forming your LLC to help take the guesswork out of the process.
Phase 1: Formation & Structure (Days 1–14)
1. Form the LLC properly (and in the right state)
Choose state of formation (usually your home state unless there’s a strategic reason otherwise)
Confirm business name availability
File Certificate of Formation (or equivalent document in another state)
Secure domain and social handles
Understand your tax classification. Depending on your structure, your LLC may be:
Taxed as a pass-through entity
Taxed as an S-Corp
Taxed as a partnership
Talk with a CPA early about the best structure from a tax perspective, your estimated taxes, payroll setup, timing considerations, and state/local tax obligations.
2. Draft and sign an Operating Agreement and Create a Cap Table
Even single-member LLCs need an Operating Agreement. Without it, state default rules will control the operation of your LLC. That can sometimes lead to results that are not intended and unanticipated.
An Operating Agreement will often cover topics such as:
Ownership percentages
Capital contributions
Profit/loss allocations
Voting rights
What happens if someone leaves
IP ownership (critical for startups)
However, you should tailor your Operating Agreement to your particular business to ensure that you are set up for success.
A cap table details the membership interest held by each founder. You will also want to document the capital contributions of each member.
3. Get an EIN (Employer Identification Number)
Immediately after formation, file for an EIN through the IRS. You will need this in order to:
Open a bank account
Hire employees/contractors
File taxes
Sign many contracts
4. Obtain required licenses & registrations
Depending on your business, you may need:
State business license
County business license
City licenses
Professional licenses
Sales tax registration
Industry-specific permits
Missing licenses can sometimes result in a voided contract or trigger fines.
5. Open a business bank account
Never mix personal and business funds. Mixing funds can destroy liability protection and complicate taxes and fundraising later.
Phase 2: Ownership, IP & Contracts (Days 15–45)
6. Assign intellectual property to the company
If founders created anything before forming the LLC, it likely belongs to that founder personally.
To transfer that IP to the company, you may need:
IP Assignment Agreements
Work-for-hire agreements
Contractor IP agreements
Trademark, copyright, or patent registration
Investors and buyers will ask for this!
7. Use proper contracts from day one
Handshake deals = future disputes. Having contract templates tailored to your operations on hand will prevent many future headaches down the line. If you are unsure which contracts are needed to support your business, a consultation with an experienced business attorney can help tremendously.
Phase 3: Compliance & Risk Management (Days 45–75)
8. Get business insurance
Consider which insurance policy you will need to properly manage the risk associated with operating your business. Insurance often costs less than a single legal dispute.
Phase 4: Preparing for Growth (Days 75–90)
9. Prepare for hiring
Before your first hire:
Create template offer letters or employment agreements and consider whether you need to include IP assignment provisions
Understand the difference between contractor vs employee classification
Create an Employee handbook
Ensure your payroll is properly setup
File any state required employment registrations
Misclassifying workers is one of the most common startup mistakes and can result in drastic tax consequences.
10. Clean up your legal infrastructure
By day 90, review your legal infrastructure to ensure your LLC has:
Signed operating agreement
Cap table
Standard contract templates
Proper bookkeeping
Separate finances
IP owned by company
This is what sophisticated clients, partners, and investors expect.
Final Thoughts…
I hope this takes some of the guesswork out of what you need to consider from a legal perspective when launching an LLC. If you handle these fundamentals early, everything that follows becomes dramatically easier.
Need help getting your startup legally dialed in?
Consulting with an experienced business attorney can save you a lot of time when sorting through all of the decisions that you will need to make. If you would like to talk, please contact me to set up a time to discuss your business and goals. Let’s get your LLC started on the right track!
This blog post is provided for informational purposes only and does not constitute legal advice. The information contained in this blog post does not constitute legal advice, should not be relied on as a substitute for legal advice, and is not tailored to your specific situation. Reading this post does not create an attorney-client relationship between you and Bonfire Legal. Laws and regulations vary by jurisdiction and change over time, so you should consult with a qualified attorney regarding your particular circumstances before making any legal or business decisions.
