LLC Formation Checklist

Forming an LLC is mostly a sequence of small tasks done in the right order. Use this checklist to work through them, and jump to your state's guide for exact fees and forms. Steps 1 through 5 create the company, steps 6 through 9 make it operational, and steps 10 through 12 keep it in good standing.

Before you file

1. Pick your state. Choose the state where you live and operate. Forming elsewhere usually means paying to register as a foreign LLC at home too. See best states for an LLC.
2. Choose and check the name. It must be distinguishable from existing entities and include an LLC designator. Search the state database, then check domain names and trademarks.
3. Appoint a registered agent. Use yourself, a co-owner, or a commercial service, with a physical address in the state. See the registered agent guide.

Create the LLC

1. File the Articles of Organization. Some states call this a Certificate of Formation. Fees range from about $35 to $500 depending on the state, and most accept online filing.
2. Handle publication if required. A few states, including New York and Arizona (outside two counties), require publishing a notice of formation in newspapers.
3. Adopt an operating agreement. Document ownership percentages, management, voting, and what happens on a member's exit. See the operating agreement guide.

Make it operational

1. Get an EIN. Apply free on IRS.gov. See the EIN guide.
2. Open a business bank account. Keep business money separate from personal money to protect your liability shield.
3. Check beneficial ownership reporting. As of the current FinCEN rules, US-formed companies are exempt from BOI reporting, but confirm the latest status in our BOI guide.
4. Get licenses and register for taxes. Check city and county licenses, state sales tax permits, and payroll registration if you will hire.

Stay in good standing

1. Calendar your recurring filings. Annual or biennial reports, franchise or entity taxes, and estimated tax payments each have deadlines.
2. Consider a tax election. If the business is profitable, ask a CPA whether an S corporation election makes sense. The deadline is generally within two months and 15 days of the start of the tax year the election takes effect.

Common mistakes to avoid

• Mixing personal and business money, which can weaken liability protection
• Skipping the operating agreement because the LLC has one owner
• Missing the first annual report or letting the registered agent lapse
• Paying a third party for an EIN, which is free from the IRS
• Forming in a state where you do not operate, then owing fees in two states

Start with your state: the state index links to fees, agents, reports, and taxes for all 50 states and DC.

A realistic timeline

Processing times differ by state and by filing method, and expedited options exist for a fee. The point of the schedule is the order: the EIN needs the approved entity, and the bank account needs both.

What to keep in your company records

• The approved formation document and any amendments
• The signed operating agreement and member ledger
• Your EIN confirmation letter
• Proof of registered agent appointment and each annual report filing
• Bank statements and a simple bookkeeping file kept separate from personal finances