Florida Business Entity Law: LLCs, Corporations, and Partnerships

Florida business entity law governs the formation, operation, and dissolution of limited liability companies, corporations, partnerships, and related organizational structures under state statute. The Florida Division of Corporations, operating within the Department of State, serves as the primary administrative authority for entity registration and compliance. Understanding the structural distinctions between entity types is foundational to navigating Florida's commercial legal landscape, as the choice of structure carries direct consequences for liability exposure, taxation treatment, and governance obligations.

Definition and Scope

Florida business entity law is codified across multiple chapters of the Florida Statutes (Florida Statutes, Title XXXVI):

Florida Revised Limited Liability Company Act — Chapter 605
Florida Business Corporation Act — Chapter 607
Florida Not for Profit Corporation Act — Chapter 617
Florida Revised Uniform Limited Partnership Act — Chapter 620
Florida Revised Uniform Partnership Act — Chapter 620 (general partnerships)

These chapters define the rights, duties, and liability structures of each entity type and establish procedural requirements for creation, amendment, and dissolution. The Florida Division of Corporations administers registration through its Sunbiz portal and maintains the public registry of active, inactive, and dissolved entities.

Scope of this page: Coverage is limited to business entities formed or registered in Florida under Florida state law. Federal tax classification, federal securities regulation, and multi-state registration obligations fall outside the state-law scope addressed here. The regulatory context for the Florida legal system provides the broader jurisdictional framework within which these statutes operate.

How It Works

Entity Formation Process

Formation in Florida follows a structured sequence under the applicable statutory chapter:

Select entity type — Determine the organizational structure (LLC, corporation, general partnership, limited partnership, limited liability partnership).
Name reservation or search — Conduct a name availability search through the Sunbiz database to confirm the proposed name does not conflict with an existing registered entity (Florida Statutes §605.0112 for LLCs; §607.0401 for corporations).
File formation documents — Submit Articles of Organization (LLCs) or Articles of Incorporation (corporations) to the Florida Division of Corporations with the applicable filing fee. As of the 2023–2024 fee schedule published by the Division, LLC formation carries a $125 filing fee; corporation filing fees begin at $70 for the Articles plus a $35 registered agent designation fee (Florida Division of Corporations fee schedule).
Designate a registered agent — Every entity must maintain a registered agent with a physical Florida street address (Florida Statutes §605.0113).
Draft governing documents — LLCs adopt an Operating Agreement; corporations adopt Bylaws. Neither document is filed with the state, but both govern internal operations.
Annual report compliance — Florida requires annual reports filed between January 1 and May 1 each year. Failure to file by the May 1 deadline triggers a $400 late fee per entity (Florida Division of Corporations, Annual Report Requirements).

Liability Protections

The core statutory function of LLCs and corporations is to create a liability shield between the entity and its members or shareholders. Chapter 605 establishes that LLC members are not personally liable for obligations of the LLC solely by reason of membership (Florida Statutes §605.0304). Corporate shareholders receive analogous protections under §607.0622. Courts may disregard these protections — a process known as "piercing the corporate veil" — when evidence establishes fraud, undercapitalization, or failure to observe corporate formalities.

General partnerships formed under Chapter 620 provide no such shield; each general partner bears joint and several liability for partnership obligations.

Common Scenarios

Florida entity law regularly addresses the following operational situations:

Single-member LLC formation — A sole owner elects LLC structure to separate personal assets from business liabilities. The entity is treated as a disregarded entity for federal tax purposes absent a contrary election, though it retains full state-law liability protection.
Close corporation governance disputes — Shareholders in a small Florida corporation dispute dividend distributions or officer removal. Chapter 607 provides statutory mechanisms for shareholder agreements and, in limited circumstances, judicial dissolution under §607.1430.
Converting a partnership to an LLC — A general partnership operating under Chapter 620 converts to an LLC under Chapter 605 to obtain liability protection. Florida permits statutory conversion without dissolving and re-forming, preserving existing contracts and obligations.
Foreign entity registration — A corporation or LLC formed in another state that conducts business in Florida must register as a foreign entity with the Division of Corporations and maintain a Florida registered agent (Florida Statutes §605.0902).
Dissolution and winding up — An entity that ceases operations files Articles of Dissolution with the Division. The winding-up process requires satisfaction of known creditor claims before distribution to members or shareholders.

Decision Boundaries

Selecting among Florida entity types turns on four primary structural factors:

Factor	LLC (Ch. 605)	Corporation (Ch. 607)	General Partnership (Ch. 620)
Personal liability shield	Yes — statutory	Yes — statutory	No — joint and several
Governance flexibility	High — Operating Agreement	Structured — Bylaws + Board	High — Partnership Agreement
Ownership transferability	Restricted by default	Shares freely transferable	Restricted by default
Suitability for outside investors	Moderate	High (stock structure)	Low

LLC vs. Corporation: LLCs under Chapter 605 offer flexible profit allocation and simplified governance without mandatory board structure. Corporations under Chapter 607 offer familiar share-based ownership, which is required for entities seeking venture capital investment or planning a public offering. The S-corporation tax election available at the federal level constrains Florida corporations to a maximum of 100 shareholders, all of whom must be U.S. persons — a limitation that does not apply to LLCs.

Limited Partnership vs. LLC: A Florida limited partnership (Chapter 620) maintains the structural distinction between general partners — who bear unlimited liability and manage the enterprise — and limited partners, whose liability is capped at their capital contribution. LLCs accomplish similar outcomes without requiring any member to bear unlimited personal liability.

Professional entities: Licensed professionals in Florida (attorneys, physicians, accountants) may not form standard LLCs or corporations for practice purposes in all cases. Instead, Chapter 621 governs professional service corporations and Chapter 605 permits professional LLCs, though members retain personal liability for their own professional negligence notwithstanding the entity shield.

The broader landscape of Florida commercial law — including contract formation, tort liability, and property ownership — is covered across the Florida Legal Authority reference index, providing context for how entity structure intersects with litigation, property, and regulatory compliance.

References

📜 10 regulatory citations referenced · 🔍 Monitored by ANA Regulatory Watch · View update log