Merrill unveils online business formation tool

Secretary of the State Denise Merrill gave a sneak peek of her office’s new online business formation tool at the Wilton Kiwanis Club meeting on May 11, and now the system has been made publicly available.

At a press conference at the State Capitol Building in Hartford May 18, Merrill and her staff officially unveiled the new tool and gave a briefing of what it can do.

“We’re always trying to promote convenience for the people we serve,” Merrill began. “One area that I think has been crying out for improvement is the way we currently require people to form businesses in Connecticut.”

“Up until now,” she said, “people forming businesses in Connecticut or registering existing companies from foreign jurisdictions had to mail, fax, or walk in paper forms to the Customer Service Center in Hartford.”

Now there’s a “better way,” Merrill said, with the secretary of the state online business formation tool. “We believe it will save customers time and taxpayers money,” she said.

The online business formation tool allows entities to form their businesses online without having to file paper forms.

“In the time it takes to order a cup of coffee, you’ll now be able to submit your application to form a business in Connecticut,” Merrill said.

The new system has been in operation for domestic LLCs to test for “two months,” Merrill said, and within that period of time 600 LLCs have been formed.

“We’re starting with domestic LLCs and corporations; it will soon be followed by foreign, out-of-state LLCs and corporations,” Merrill said.

Merrill introduced Seth Klaskin, director of the Secretary of the State’s Business Services Division, to go over some of the finer workings of the online tool.

He said there’s a guest-user option for one-time filings, such as annual reports, but people forming businesses will need to make accounts, and that, according to Klaskin, is an “added bonus.”

“When you form an account, you’ll get an inbox, and that inbox will then be your inbox for the remainder of the duration of your entity, so whenever you do any filings, you’ll get notifications and you’ll get copies in your inbox so you always have a place you can return to get copies of information you might need,” Klaskin said.

The field in which an applicant enters the name of the business being formed doubles as a database, “so the field that the name is listed does an automatic search to ensure that you’re selecting a name that doesn’t already exist.

“If it allows you through, then you can use that name,” Klaskin said.

Klaskin said “formation filing is a bit more tricky than other types of filing” because of the necessity for appointing agents.

“We’ve created this neat little function where you provide your agent’s email address and the system automatically sends out an email to your appointed agent notifying them that they’ve been appointed, if they accept,” Klaskin said.

One of the best things about the new online business formation tool, according to Klaskin, is that it nearly eliminates all potential for error.

“You almost can’t have a filing rejected for a standard rejection reason,” Klaskin said. “In other words, some of the common rejection reasons are, you failed to sign it, you failed to put the date or you failed to put the capacity that you're signing under.”

“The beauty of the online system is, if you overlook a field that’s a necessary field, it will flag you and not let you submit until you fill that field in,” he said.

This slim margin for error makes things move a lot faster, Klaskin said. “Really, another reason why we’re able to process the applications that are queued up from the online filing much faster is because they come in almost perfect.”

The online fee is $120 for a standard domestic LLC formation and they should be reviewed within five days.

There are no plans to phase out paper filings at present.

“We’ll probably always have some version of a paper system, or at least an ability for people to come in in person, because some of these [applications] are more complex, I’m sure,” Merrill said.

She added that she was confident foreign LLCs and corporations would be able to use the tool by the end of May.

The online business formation tool can be accessed via the secretary of the state’s website, or by visiting and clicking “File Documents.”