Immediate Deadlines
- File Beneficial Ownership Information (BOI) with FinCEN:Within 30 days of formation for entities formed in 2026+
- File initial state report (if required):Typically 60-90 days after formation in CA, NV, others
- Open business bank account and segregate funds:Immediately after EIN is issued to preserve liability shield
Documents You'll Need
- Government-issued photo ID for each owner
- Social Security Number or ITIN for each owner
- Proposed LLC name (3 alternates in case of conflict)
- Registered agent name and physical street address
- Principal business address
- List of members and their ownership percentages
- Business purpose statement
Step-by-Step
Choose the formation state
Most small businesses should form in the state where they actually operate — forming elsewhere (Delaware, Wyoming, Nevada) usually requires also registering as a foreign LLC in your home state, doubling fees and reports. Delaware is favored for venture-backed startups due to its Chancery Court and case law. Wyoming and Nevada offer privacy and no state income tax but require local registered agents.
Search and reserve the LLC name
Check the Secretary of State's business name database to confirm your name is available. Names must include 'LLC,' 'L.L.C.,' or 'Limited Liability Company' and cannot be deceptively similar to existing entities. Most states let you reserve a name for 30-120 days while you prepare filings. Also search USPTO TESS for federal trademark conflicts before committing.
Appoint a registered agent
Every LLC must designate a registered agent — a person or service with a physical address in the formation state who accepts legal papers during business hours. Options: yourself (if you have a public address you're always at), a member, or a commercial registered agent service ($100-$300/year). PO boxes are not allowed. Failure to maintain an agent leads to administrative dissolution.
File Articles of Organization
File the Articles (called Certificate of Formation in DE, Certificate of Organization in PA) with the Secretary of State. Filing fees range $35 (Kentucky) to $520 (Massachusetts). Most states allow online filing and approve within 1-10 business days. The Articles state: LLC name, registered agent, principal office, organizer signature, and sometimes member names and management structure.
Get an EIN from the IRS
Apply for a free Employer Identification Number at IRS.gov — instant if you apply online with a US-based responsible party SSN. Foreign owners must file Form SS-4 by mail or fax (4-8 weeks). The EIN is required to open a bank account, hire employees, file taxes, and complete the BOI report. Never pay third parties to get an EIN — it is always free directly from the IRS.
Adopt an Operating Agreement
An Operating Agreement governs how the LLC runs: ownership percentages, profit/loss allocations, voting rights, management structure (member-managed vs manager-managed), buyout provisions, and dissolution rules. Only a handful of states (CA, DE, NY) legally require one, but every LLC should have one to override unfavorable default state rules and to preserve the liability shield in court.
File BOI with FinCEN and stay compliant
Under the Corporate Transparency Act, most LLCs must file a Beneficial Ownership Information report with FinCEN within 30 days of formation (90 days for 2025-formed entities). The report identifies each beneficial owner (25%+ ownership or substantial control). Then maintain compliance: pay annual report fees ($0-$800), file franchise taxes, renew business licenses, keep separate bank accounts, and document major decisions.
How This Varies by State
Annual fees vary widely: California charges an $800 minimum franchise tax annually plus a fee on revenue over $250K. Delaware charges a $300 annual franchise tax. Wyoming charges $60. Massachusetts has the highest filing fee ($500). Some states (NY, AZ, NE) require publication in local newspapers for 6 weeks after formation ($40-$2,000+). Series LLCs are available in DE, TX, IL, and a few others. Anonymous LLCs (no member disclosure) are available in NM, WY, DE.
Federal Law Considerations
An LLC is a state-law entity with no default federal tax classification. By default, single-member LLCs are 'disregarded entities' (taxed on Schedule C) and multi-member LLCs are partnerships (Form 1065). You can elect S-corp or C-corp taxation by filing Form 8832 or Form 2553. The Corporate Transparency Act (FinCEN BOI) applies to most LLCs with limited exceptions (large operating companies, regulated entities). Federal employment law applies once you hire employees (FLSA, FICA, FUTA).
Common Mistakes to Avoid
- Forming in Delaware or Wyoming when you only operate in your home state (double fees)
- Skipping the Operating Agreement and letting default state rules apply
- Co-mingling personal and business funds (pierces the liability shield)
- Missing the FinCEN BOI deadline ($591/day penalty)
- Forgetting to file annual reports — leads to administrative dissolution and loss of liability protection
Official Resources
Related Resources on This Site
Forms
- articles of organization
- operating agreement
- ein application
When to Get a Lawyer
- Multi-member LLCs with unequal ownership or contributions
- Outside investors, profit interests, or convertible notes involved
- Real estate holdings, professional practices, or regulated industries
- Foreign owners or international tax considerations
Frequently Asked Questions
How much does it cost to start an LLC?
Do I need a lawyer to form an LLC?
Will an LLC protect me from all liability?
Can I be the sole owner of an LLC?
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.