Generative artificial intelligence (GenAI) or large language models (LLMs) have the potential to revolutionize computational social science, particularly in automated textual analysis. In this paper, we conduct a systematic evaluation of the promises and risks of using LLMs for diverse coding tasks, with social movement studies serving as a case example. We propose a framework for social scientists to incorporate LLMs into text annotation, either as the primary coding decision-maker or as a coding assistant. This framework provides tools for researchers to develop the optimal prompt, and to examine and report the validity and reliability of LLMs as a methodological tool. Additionally, we discuss the associated epistemic risks related to validity, reliability, replicability, and transparency. We conclude with several practical guidelines for using LLMs in text annotation tasks, and how we can better communicate the epistemic risks in research.