Forming an LLC takes a handful of steps, and in most states you can complete the process in under a week. The core of it is filing a document called Articles of Organization with your state’s business filing office (usually the Secretary of State), but there are a few things to handle before and after that filing to make your LLC fully operational.
Choose and Search Your Business Name
Every state requires your LLC name to be distinguishable from other businesses already on file. Before you commit to a name, run a search on your state’s business filing website to check availability. Most states offer a free online name search tool.
Your name must include a designator like “Limited Liability Company,” “LLC,” or “L.L.C.” Some states accept abbreviations only in specific formats, so check the exact requirements on your state’s filing page. If you want to operate under a different public-facing name (sometimes called a DBA or “doing business as” name), you can register that separately after formation.
Designate a Registered Agent
Every LLC needs a registered agent, which is a person or company designated to receive legal and government documents on behalf of your business. If your LLC is ever sued or subpoenaed, the paperwork gets delivered to this agent. They also receive tax notices and official state correspondence.
A registered agent must have a physical street address (not a P.O. box) in the state where your LLC is formed and must be available at that address during normal business hours. You can name yourself, a trusted person, or a professional registered agent service. Many commercial services charge between $50 and $300 per year. Naming yourself is free but means your home address becomes part of the public record, and you need to be reliably available during business hours to accept documents.
File Articles of Organization
This is the document that officially creates your LLC. You’ll file it with your state’s business filing office, either online or by mail. The information required is fairly standard across states:
- LLC name with the required designator
- Principal business address (a physical street address)
- Registered agent’s name and address
- Organizer or authorized representative (the person signing the filing)
- Management structure (whether the LLC is managed by its members or by designated managers, though not every state requires this on the initial filing)
Some states ask for a brief statement of purpose, but most let you use a general “any lawful business” description. Once the state processes your filing, your LLC legally exists. Many states process online filings within one to three business days, though some take longer.
What It Costs to File
State filing fees for Articles of Organization vary widely, typically ranging from about $50 to $500 depending on the state. Some states bundle in additional small fees for things like the registered agent designation or a certified copy of your documents. Beyond the initial filing, most states require an annual or biennial report with its own fee, commonly between $25 and $300. A few states also impose a minimum annual tax on LLCs regardless of whether you earn a profit, so check your state’s requirements before filing to understand the full recurring cost.
Get an EIN From the IRS
An Employer Identification Number (EIN) is essentially a Social Security number for your business. You need one to open a business bank account, hire employees, and file business taxes. The IRS issues EINs for free through its online application tool, and the process takes only a few minutes.
To use the online tool, your principal business must be in the U.S., and you’ll need the Social Security number or ITIN of the “responsible party,” which is the person who controls the LLC. The application can’t be saved partway through and times out after 15 minutes of inactivity, so have your information ready before you start. If approved, you’ll receive your EIN immediately on screen. Print or save that confirmation notice; you’ll need it for banking and tax filings. The tool is available most hours but not 24/7, so plan accordingly.
Create an Operating Agreement
An operating agreement is an internal document that spells out how your LLC will be run: who owns what percentage, how profits and losses are divided, what happens if a member wants to leave, and how major decisions get made. Some states require one, but even where it’s optional, having an operating agreement in writing protects you. Without one, your state’s default LLC rules govern your business, and those defaults may not match what you and any co-owners actually agreed to.
If you’re a single-member LLC, an operating agreement still helps establish that your business is a separate entity from you personally, which reinforces the liability protection that’s the whole point of forming an LLC. You don’t file this document with the state. Keep it with your business records.
Open a Business Bank Account
Once you have your Articles of Organization and EIN, open a dedicated bank account for your LLC. Keeping business finances separate from personal finances is critical for maintaining the liability protection an LLC provides. If you mix funds freely between personal and business accounts (sometimes called “commingling”), a court could decide your LLC doesn’t truly operate as a separate entity and hold you personally responsible for business debts.
Most banks will ask for your filed Articles of Organization, your EIN confirmation, a form of personal ID, and sometimes your operating agreement. Some banks also require a certificate of good standing, which you can order from your state’s filing office for a small fee.
Handle State and Local Licenses
Forming an LLC gives you a legal business entity, but it doesn’t automatically authorize you to operate. Depending on your industry and location, you may need business licenses, professional permits, or sales tax registrations. Check with your state’s revenue department and your local city or county office to find out what applies. Some industries, like construction, food service, and healthcare, have specific licensing requirements that must be in place before you start operating.
Ongoing Requirements After Formation
Your LLC isn’t a one-time filing. Most states require periodic reports (annual or biennial) that update your business address, registered agent, and member or manager information. Missing these deadlines can result in late fees, and some states will administratively dissolve your LLC if you fall too far behind.
You’ll also need to handle tax obligations. By default, a single-member LLC is taxed as a sole proprietorship and a multi-member LLC is taxed as a partnership, meaning profits pass through to your personal tax return. You can elect different tax treatment (such as S corporation status) by filing the appropriate form with the IRS, but the default works fine for many small businesses. Keep clean financial records from day one, because separating a year’s worth of tangled transactions later is far harder than tracking them as you go.