To form a new LLC, you’ll need to hit the ground running with a smart business name, a loyal registered agent, and a few crucial documents outlining the organization and management of your company.
When you start an LLC with Epik, we help you breeze through the process of registering your business with your state and keep you compliant all year long. We’ll register your Articles of Organization and BOI Report, we’ll remind you of local and federal requirements, and we’ll guide you through any questions along the way. Get started today with both our registered agent services and our LLC formation service—take care of everything you need for just $225 plus any state fees. After that first year, your registered agent will renew at just $125 a year!
Starting a limited liability company (LLC) as a small business owner can feel like a daunting task, especially for first-time entrepreneurs. But your LLC can add credibility to your venture and safeguard your personal assets. In other words, it’s worth the effort.
In this comprehensive guide, we’ll walk you through the essential steps and considerations to help you embark on your business journey with confidence. Whether you’re selling old jewelry, freelancing your photography skills, or running a horse grooming business, grasping the fundamentals of LLC formation can help you go the long haul.
What is an LLC?
A limited liability company (LLC) is a state-level business entity that blends the flexibility of a business partnership with the liability protections of a corporation. Just about anyone can get their small business started with an LLC, and it isn’t hard to understand why. If any legal disputes or unexpected financial obligations crop up, then the personal assets of LLC members, like your minivan or antique coin collection, aren’t impacted.
How do you start an LLC?
Setting out to form your own LLC is a multi-step process that includes coordinating with your Secretary of State and other federal agencies. In this section, we provide a solid road map to guide you through these steps and provide resources if you want to investigate further.
Be aware that every state does things a little differently, so always double-check the information we provide here against the information found on your local Secretary of State’s website.
1. Choose a Name for Your LLC
Landing on a name for your LLC should be one of the first things you do when you start getting down to business.
Your business name should be easy to remember and be able to grow with your brand. Most importantly, you want to make sure that the name isn’t already being used by someone else. You can do this by searching for the name on your Secretary of State’s website and by checking to see that no one has already the name in your industry.
It’s also smart to make sure that the domain name that matches your business name isn’t already owned by someone else. Use our domain name search to find an available domain that aligns with your preferred business name.
While registering your business name means that no other businesses get to register that name as their own, that doesn’t guarantee legal protection if others still use your name for their own business. Registering a trademark on your business name helps protect it as intellectual property, giving you exclusive rights.
2. Choose a Registered Agent
Most states require LLCs to have a registered agent on file. This is a person with a physical address in the state you’ll be doing business in, someone who is capable of receiving legal and official communication there during regular business hours. Basically, the state wants to ensure that they’ll be able to get in touch with an official representative from your company when they need to.
The role of the registered agent can’t be taken lightly. Some people function as their own registered agents or assign a trusted employee, while many people hire state or national commercial registered agents to maintain their privacy and to receive and organize all official communication.
3. File your Articles of Organization (Certificate of Formation)
Every LLC will file a form called the Articles of Organization with their Secretary of State (this form is sometimes referred to as a Certificate of Formation). In this document, you’ll include your company name and address, your registered agent’s information, the purpose and management structure of your company, and information about the organizers.
Every state has a different fee for filing the Articles of Organization, but the range is typically from $40 to $500. As always, double check to see what specific information you can find on your Secretary of State’s site. You can file these Articles yourself on the Secretary of State’s website, but it’s even quicker to hire companies (like Epik and Registered Agents, Inc.) to file your paperwork for you.
4. Write an Operating Agreement
The creation of an Operating Agreement is one of the most important and valuable steps you’ll take in forming your LLC. Assemble your team of owners and members to make sure that everyone is aligned on both big-picture goals and the day-to-day running of the business.
This legally binding contract between the LLC owners outlines your management structure, how your profits and losses will be shared, and what will happen if any changes in ownership occur. This is one of the best moments to get a lawyer or an expert involved to help you and your crew head off any potential future disputes.
5. Get an Employer Identification Number (EIN)
All LLCs also need an EIN, which is an identification number assigned to businesses by the IRS. This number is essential for filing taxes, applying for permits and licenses, hiring employees, and opening business bank accounts. The EIN is essentially a social security number for your business that establishes it as legitimate, and applying for one online with the IRS only takes a few minutes.
6. Open a Bank Account
One of the great things about LLCs is the limited liability for owners, and creating a business bank account specifically for that LLC is a crucial step in creating that necessary financial distance. When you go to create your business bank account, you’ll usually need your Articles of Organization, your operating Agreement, and your EIN.
7. File a Beneficial Ownership Information (BOI) Report
The BOI Report is a relatively new requirement for LLCs coming from the Financial Crimes Enforcement Network (FinCEN). As of January 1, 2024, all LLCs created in 2024 need to file this report within 90 days of formation, and any LLCs formed in 2025 or later will need to file this report within 30 days.
The BOI Report will ask for the names and information of all beneficial owners—anyone with at least 25% membership interest or anyone who has substantial control within the LLC. This information doesn’t become public record, but will be accessible to government and financial institutions.
When you use Epik to help you form your LLC, you can also opt to have us file your BOI report for you for only $9—a small cost to keep your business in good legal standing.
8. Be Ready to Expand
Whenever you’re ready to take your company across state lines, you’ll start by registering your business as a foreign LLC in each state you plan to do business. This process is called “foreign qualification”—and it’s legally required to transact business outside of the state where you formed your company. Check out our detailed guide on foreign qualification for more information.
Why Do You Need an LLC?
Plenty of small-business owners get by with sole-proprietorships or general partnerships. This generally means that they are selling goods or services without formally establishing their business as a separate legal entity. But let’s break down the main reasons why new entrepreneurs choose to protect themselves—and their businesses—by forming an LLC.
Privacy
Forming an LLC allows you to create concrete boundaries between your work life and your personal life. Additionally, an LLC gives you the option of using a registered agent, someone who can list their own address on your formation paperwork instead of your own. The moment you list your own address as part of your business formation paperwork, that information is public record and is hard to fully erase from the web. This opens you up to spammy snail mail and lets people find out where you and your family live. Keeping your personal information private is like digging a moat around your private life.
Liability Protections
It’s in the name: forming an LLC provides a shield against personal liability, keeping your personal kingdom safe from suits. So, if your LLC faces legal action or debt of any kind, your assets as a member aren’t in danger. Creditors cannot pursue your personal belongings, your home, or your bank accounts. This “limited liability” serves as a huge advantage for entrepreneurs looking to mitigate personal risk while operating a business.
Credibility
Having a legitimate LLC tells people that you mean business, lending you an aura of credibility and professionalism. Potential clients and partners are more likely to view you as accountable and responsible because you have undergone the steps to establish yourself as a legal company. The structured framework of an LLC inspires trust and confidence in stakeholders and shows your readiness to navigate the unpredictable seas of running a company.
Pass-Through Taxation
LLCs practice pass-through taxation, which can be a huge boon to entrepreneurs because it allows LLC owners to bypass the double taxation system typically associated with traditional corporations. Instead, business profits and losses are “passed through” the company and are reported on the owners’ individual tax returns. This streamlined approach not only simplifies the tax filing process but also allows LLC owners to deduct business losses from other income, potentially reducing your overall tax burden.
Why You Should Hire Us to Form Your LLC
Business Guidance
While the way towards forming a legal LLC may seem complicated, you don’t have to venture off into the unknown without guidance. We can help you safeguard your assets and help you learn to avoid common legal pitfalls so that you can keep your eyes on the prize.
Local Expertise
Our guides are filers work for businesses in all 50 states—they know the minor differences between state requirements, they know what forms each state requires, and they know what it takes to stay compliant year after year.
Privacy
When you hire Epik and Registered Agents, Inc. to form your LLC for you, you get the added bonus of keeping your own personal home address off of your filings. Our address is listed on government forms that become public record, and your data stays safe with us and only us.
Peace of Mind
We know that keeping track of annual deadlines and understanding new requirements is the least exciting thing about running a business. We stay on top of what you have to do so that you can keep doing what you want to do.
How Our Services Work
Our LLC formation services can be added at any time to our registered agent services. When you choose Epik to form your LLC, we’ll ask you to answer a few basic questions about your business needs and goals. We’ll gather up all the required information, whip up your Articles of Organization, and send everything to your local state agency to approve. In the meantime, you’ll be able to work with us to get your business online and your website ready to receive tons of new customers.
Since establishing your online presence is vital in spreading the word for your new business, we help you figure out what kind of hosting and domain services you’ll need at the start of your journey. At Epik we give you all the tools you’ll need to get your LLC up and running online. If you decide down the line that you don’t need these services, they are easy to cancel or modify.
We’ll let you know when your state approves your LLC filing and get you set up with the next steps, like helping you get an EIN and businesses bank account. We’ll keep your company compliant, help you with the finer details of filing your taxes, and keep you up to date with new state and federal requirements.
So whether you find the excessive bureaucratic labyrinth intimidating, or you just don’t like doing paperwork, you can let us take care of your LLC’s forms, fees, and filings so that you can get back to the real work of running your business.
Frequently Asked Questions
Anyone running a business without filing an LLC or corporation with the state is running a sole-proprietorship. A sole proprietorship can become an LLC by filing Articles of Organization with their state. An LLC is going to have more reporting requirements than a sole proprietorship, but the benefits include more tax flexibility, privacy, and, of course, liability protections.
There are three main areas in which LLCs and corporations differ:
- Ownership: In an LLC, owners are called members. In a corporation, owners are generally referred to as shareholders.
- Management: LLC members can manage the business themselves or appoint managers. In a corporation, shareholders elect a board of directors to make decisions and appoint officers.
- Taxes: LLC generally use pass-through taxation, but they can elect to be taxed as S-corps or C-corps. Corporations have less flexibility because they pay taxes on profits at the corporate tax rate. If the corporation distributes profits to shareholders as dividends, those dividends are taxed again at the individual level, leading to potential double taxation.
- Reporting Requirements: Corporations generally have a longer to do list and more bureaucratic hoops to jump through than LLCs.
This is going to vary greatly depending on the state you form your LLC in. States with flat filing fees can range from $40 to $500, and some other states base their formation fee on the number of members your business has.
When you hire a company to form your LLC for you, there is a one-time fee in addition to any state fees. At Epik, we form your LLC for $100 and include options for our registered agent services, BOI filing service, and our larger suite of online presence packages to give you some extra peace of mind.
Some of the most common types of LLC include:
- Single Member LLC – These only have one owner.
- Professional LLC – These are crucial for state-licensed professionals like lawyers and doctors.
- Series LLC – This is for LLCs that need separate liability protection for different parts of their business.
- Non-profit LLC – This non-profit option is possible in some states, like Kentucky, Minnesota, North Dakota, and Tennessee.
LLCs with default tax classifications don’t pay federal taxes, and instead the profits from the company are distributed to owners/members. These members then report their earnings from that on their own personal filings (this process is referred to as pass-through taxation). But LLCs could be required to pay different kinds of state taxes, like a franchise tax, if required by their state. LLCs can also choose to be taxed as different kinds of corporations.
Absolutely. A lot of people file LLCs on their own every day. The big drawback of doing this is that the personal information that you list on your Articles of Organization will become public record—your name, your personal address, etc—as the organizer. When you hire someone, like us, to file for you, we use our information in the place of yours.
You should consider upfront whether or not you’ll eventually expand your business into other states. If there is even a possibility that you’ll want to operate in more than one state, make sure you understand the requirements of each state you’re considering. You’ll need to register your LLC in both states and have a registered agent in both states. Hiring a national service, like Registered Agents, Inc., to form your LLC and serve as your registered agent can make you prepared for expansion from day one.