Limited liability companies in Connecticut are popular business forms which can be incorporated with the Connecticut Secretary of the State – the Business Division. For a suitable understanding of how companies can be registered in this state, we suggest you read the general guide to company incorporation in Connecticut written by our specialists in company formation. Before opening a business in USA, one should observe the obligations and conditions in this field, mentioning that our company formation agents in USA can offer complete support for both local and foreign entrepreneurs interested in enlarging their activities in USA and particularly in Connecticut.

Types of LLCs in Connecticut

LLCs in Connecticut may be the proper solutions for small or medium businesses in this American state. In matters of taxes, it is good to know that there is no corporate income tax imposed. We suggest you ask for information about each type of company, in order to choose according to your needs. Our consultants are at your disposal for support and guidelines.

Conditions to open an LLC in Connecticut

An LLC in Connecticut can be registered without the minimum share capital requirement. The Articles of Association of an LLC must comprise details about the owners, the business name, the type of management, the purpose of the business, the name of the appointed agent and their signatures. When submitting the documents, please consider that a fee of about $120 is necessary to be paid. One important condition for setting up the company in Connecticut is naming a registered agent with residency in this state and who is in charge of accepting legal documents on behalf of the enterprise he/she represents. This can be whether an individual or another business entity in Connecticut.

Obtaining the Employer Identification Number

The EIN or the Employer Identification Number represents the tax ID number of a company which is necessary for tax purposes in Connecticut. Once the company’s documents and the business activity have been accepted, you should apply with the Internal Revenue Service (IRS) in order to receive the EIN.

The corporation business tax in Connecticut

Connecticut imposes the corporate business tax which is set at a 7,5% rate for C corporations, the business entities for which the revenues are levied in a separate manner from its proprietors. As for the LLCs in Connecticut, these are not levied with the corporate business tax and the profits distributed to the shareholders are subject to state and federal taxes.

Opening a bank account for your firm in Connecticut

If your company has been accepted and registered in Connecticut, the next step is to open a bank account for future financial transactions among many others. After a simple verification of the company’s documents, one can analyze the bank’s business packages that suit most the company. Besides the business bank card, the beneficiary of the account may select varied banking services, in order to proceed with the online transactions.

What other taxes are imposed for a business in Connecticut?

Besides the corporate tax in Connecticut, the sales tax of 6.35% is applicable to most of the goods and services for sale purposes in this state. The exemption in this matter refers to the food products which are not subject to the sales tax in Connecticut. The capital gains tax in Connecticut is set at 6.99%, and it is recommended to ask for advice if you want to know more about the taxes imposed for your company in this state.

Tax registration in Connecticut

A “sellers permit” is mandatory for all entrepreneurs and businesses before the registration for taxes is made, and this kind of document is issued by the Connecticut Department of Revenue, with a validity of five years. The next step is to apply for EIN, the Employer Identification Number with the IRS (Internal Revenue Service) department, for which information about the business type, the owners and the activities are needed. The monthly, quarterly and annual filing need to be considered once you have financial activities in Connecticut. It is important to know that a resale certificate helps a business person avoid paying the sales tax in Connecticut, but for more information in this matter, you can ask for complete support from our team of advisors.

Business licenses in Connecticut

Opening a company in USA, and particularly in Connecticut, may require applying for special licenses and permits. Health, construction, finance, gambling, trading, agriculture, retail, consulting, land use, signage, fishing, and hunting are only a few of the domains in which a business license or permit are necessary. These are issued by the Connecticut Business License & Business Permit institution. For a proper understanding of the requirements in this matter, we suggest you address your concerns to our USA company formation agents.

Hiring staff for your company in Connecticut

If you want to start a business in USA and you need staff, you may choose the skilled local workforce. In most cases, the recruitment agencies, online and offline, are strongly recommended, as they have a wide database of potential candidates for your company. For tax purposes and social contributions, one must register the employees with the Connecticut Department of Labor.

Do I need accounting services for my company?

Yes, instead of establishing an entire accounting department for your business in Connecticut that might be subject to specific costs, you might want to direct your attention to the services of an accounting firm in USA. Tax advice, tax registration, payroll and bookkeeping are a few aspects to consider when looking for accounting services. A specialized firm in this matter is the proper solution for your company, whether small, medium or large. This kind of firm uses varied accounting systems and helps companies track all the financial activities of the firm by keeping the records of the accounts. Accounting services are recommended in the first place, especially for managing the startup budget, maintaining comprehensive expenditure records and preparing the operating budget in the firm, bearing in mind the future investments in the company.

Do I need insurance for my company in Connecticut?

Yes, small and medium businesses with establishments in Connecticut must have a general liability insurance. Here are a few aspects to consider about this kind of insurance:

• A general liability insurance covers bodily injuries, medical payments and property damage in a company;
• Copyright infringement, false arrest, wrongful evictions and invasion of privacy and property are protected by such insurance;
• The loses caused by violating the copyright of another business are protected by the general liability insurance;
• Workers’ compensation, unemployment insurance and auto insurance for commercially-owned vehicles are comprised by the general liability insurance.

Foreign investors who want to start a business in USA and especially in Connecticut can ask for complete support from our team of company formation specialists in USA.

Post-registration matters for a company in Connecticut

Opening a company in Connecticut is not only linked to the registration requirements and investors can think of the development possibilities like opening a website. This can help them define the brand, no matter the goods and services they are offering on the market and the industry they activate in. This is the most useful method for long-term companies and successful businesses, however, it is also important to implement a solid marketing strategy comprising varied online promotion methods like having social media profiles, registering a google account and creating specific accounts for business reviews. It is well-known the fact that a business can grow with the help of an official website presenting the company profile and the activities. Once the business grows, you can direct your attention to an Amazon store and see all the conditions for placing your products on this appreciated business platform or any others like this.

Short conclusion about opening a company in Connecticut

Foreign or local entrepreneurs interested in opening a company in USA, including in Connecticut, should respect the main requirements in this matter:

• reserve and verify the business name with the registration authorities;
• choose the business structure for their future operations in Connecticut;
• appoint a representative agent for their company in this state;
• open a bank account for depositing the minimum share capital and future operations;
• obtain the needed special licenses and permits and register for tax purposes in Connecticut.
• Advantages of opening a business in Connecticut

Among the reasons why you should start a business in USA, and particularly in Connecticut, is the fast incorporation process. The manufacturing, mining, agriculture, real estate, tourism, and retail are among important fields that successfully sustain the overall economy in Connecticut. Cities like New Haven, Norwalk, Waterbury, Hartford, New Britain or Bridgeport are suitable destinations for business.

If you have decided for doing business in Connecticut and you need to know the tax system in this American state, we invite you to talk to one of our company formation representatives in USA. Foreign entrepreneurs in Connecticut need to consider the corporate income tax which is at a flat rate of 9% and the federal corporate income tax which applies depending on the registered incomes in a year. Essential details about the taxation structure in Connecticut can be found below, with the mention that our advisors can offer complete information on request.

The corporate income tax in Connecticut

The business tax in Connecticut or the corporate income tax is set at 9% and it is the 6th highest tax rate in USA. Any business or company with establishments in Connecticut need to observe this important tax and file the forms with the Department of Revenue in Connecticut through its local offices.

What are the federal corporate income tax rates in Connecticut?

Besides the business tax mentioned above, companies need to pay the federal corporate income tax which can be seen in the table below and the established rates and fees for each income bracket:

Income                                                                                                     Tax Rate
Up to $50,000                                                                                              15%
Between $50,000 and $75,000                                         $7,500 + 25% of the amount over 50,000
Between $75,000 and $100,000                                       $13,750 + 34% of the amount over 75,000
Between $100,000 and $335,000                                     $22,250 + 39% of the amount over 100,000
Between $335,000 and $10,000,000                                $113,900 + 34% of the amount over 335,000
Between $10,000,000 and $15,000,000                           $3,400,000 + 35% of the amount over 10,000,000
Between $15,000,000 and $18,333,333                           $5,150,000 + 38% of the amount over $15,000,000
$18,333,333 and more                                                      $6,416,667 + 35% of the amount over $18,333,33

The sales tax in Connecticut

The sales tax in Connecticut is set at 6.35% and it is available in all cities, without any other municipal tax imposed. This is imposed on goods and services for sale purposes, with the difference that varied food products are exempt from such taxation. We are at your disposal with information in this matter and we can also help you set up a company in USA, especially in this state.

What is the capital gain tax in Connecticut?

In Connecticut, the capital gains are levied with a tax rate of 6.99%. For complete information about all the taxes in this state, please feel free to address to our team of company formation consultants in USA. Also, if you would like to start a business in USA, our advisors can offer assistance in any state you would like to set up your operations.

Tax exemptions for non-profit entities in Connecticut

Non-profit entities like charities, scientific institutions, or related organizations are exempt from taxation in Connecticut. The Department of Revenue in Connecticut provides several documents for such entities, but for complete support in this sense, you can talk to one of our advisors.

What companies need to pay taxes in Connecticut?

Entities like partnerships, C-Corporations, S-Corporations and sole proprietorships need to pay the corporate tax imposed in this state.

Other tax facts in Connecticut

The rate of 1.97% is the average effective property tax rate imposed in Connecticut counties. The cigarette and alcohol tax need to be considered in Connecticut if you have a business dealing with these types of products.