Starting an LLC is mostly a paperwork process, and the paperwork is more routine than it looks at first glance. The state wants a name, an address for legal papers, a short filing form, and a fee. After approval, the federal government wants a tax number, and your bank wants proof that the business exists. The steps below follow the order that works in almost every state. This guide is general information only. It is not legal advice and it is not tax advice.

Step 1: Choose a state

Most people should form their LLC in the state where they actually do business. That is usually the state where you live, work, meet customers, or keep inventory. Forming at home keeps things simple. You file once, you pay one set of state fees, and you deal with one filing office.

Forming in a different state rarely removes the work at home. If you form in one state and operate in another, the second state will usually require a registration called a foreign qualification, with its own fee and its own annual report. That means two states, two reports, and two sets of deadlines to track. Ads that promise savings from forming far away often leave that part out.

There are narrow cases where another state makes sense, for example when the business will operate mainly in that other state. For most small businesses, the home state is the practical and lower cost choice. To see the filing fee, the report schedule, and the specific rules for each state, start with our state formation guides, which list all fifty states with fees sourced from each state filing office.

Step 2: Name the LLC

Your LLC needs a name that no other business in the state is already using in a confusingly similar way. Every state filing office offers a free name search on its website. Run your chosen name through that search before you file, because a rejected name means a rejected filing and a lost fee in many states.

Most states also require a designator in the name. That is the part that signals the business form, such as LLC or Limited Liability Company. Most states ban certain words in business names unless the business holds a special license. Words connected to banking, insurance, and education are common examples.

Check three more places before you settle on a name. Search the web for businesses already using the name in your line of work. Check whether the matching domain name is available if you plan to build a website. Look at the federal trademark database if the name matters to your brand, because state approval does not protect you against a trademark claim from an existing business. A name that clears the state search can still create problems later if it clashes with an established mark.

Step 3: Choose a registered agent

Every state requires an LLC to name a registered agent. The agent is a person or company with a physical address in the formation state who accepts legal papers and official state mail on behalf of the business. The agent must be available at that address during regular business hours, and the address becomes part of the public record.

You can often serve as your own agent if you meet the state rules and you are comfortable listing your address publicly and being present during business hours. Many owners prefer a commercial agent so their home address stays off the public record and so papers are received even when they travel or work elsewhere. Our registered agent checker walks through the choice in about a minute, and our guide on whether you need a registered agent explains the trade offs in full.

If you use a commercial service, compare the renewal price, not only the first year offer. Northwest Registered Agent lists formation at $39 plus state fees, with registered agent service free for year one and then $125 a year, based on prices checked on merchant pricing pages on October 25, 2026. You can see the details at Northwest. Whatever you choose, pick the agent before you file, because the filing form asks for the agent name and address.

Step 4: File Articles of Organization

This filing is the step that legally creates the LLC. Depending on the state, the form is called Articles of Organization or a Certificate of Formation. Most states let you file online in fifteen to thirty minutes. The form asks for basic facts, the business name, the address, the registered agent, and in some states the names of the owners or managers.

The filing fee is the largest single cost of starting an LLC. State filing fees vary by state, roughly $40 to $500, and the exact fee for your state is listed on its state page on this site. Some states charge extra for faster processing, which is optional in most cases.

Before you pay anything, run your numbers through our LLC cost calculator. The calculator adds the state fee, any provider fee, and registered agent cost together, and it shows the first year total and the cost every year after. That yearly view matters, because a low filing offer with a high agent renewal can cost more over time than a plainer offer with a steady renewal price.

Keep the approved filing document when it arrives. Your bank, your payment providers, and some customers will ask for it.

Step 5: Write an operating agreement

An operating agreement is the internal document that records how your LLC is owned and run. It covers who owns what share, how decisions get made, how money is contributed and paid out, and what happens if an owner leaves or the business closes. Most states do not require you to file this document with the state. You keep it with your business records.

It is tempting to skip this step when you are the only owner. Resist that urge. A short written agreement still helps. It supports the separation between you and the business, it answers questions a bank may ask when you open an account, and it records in plain words that the business is real and organized. For LLCs with more than one owner, the agreement matters even more. Disagreements about money and control are much easier to resolve when the answers were written down at the start, while everyone agreed.

Templates exist online, and formation services often include one. Read any template before you sign it, and make sure the ownership shares and decision rules match what the owners actually intend. If the ownership structure is complex, have an attorney in your state review the draft. That review is money well spent compared with fixing a dispute later.

Step 6: Get an EIN

An EIN is the federal tax number for a business, issued free by the IRS. EIN stands for Employer Identification Number. You will need one to open a business bank account at most banks, to hire employees, and to file certain federal tax forms. Even single owner LLCs with no employees usually benefit from having one, because it lets you use the business number on paperwork instead of your personal Social Security number.

Apply on the IRS website. The application is free, and online applications usually receive the number the same day. Be careful with search results here. Third party sites charge fees to submit the same free application, often with names and designs that look official. The genuine IRS application costs nothing. If a site asks for a card payment to get an EIN, you are in the wrong place.

Save the IRS confirmation letter when your number is issued. Banks and payroll providers will ask for it, and replacing it takes time.

Step 7: Open a business bank account

Open a bank account in the name of the LLC as soon as the filing is approved and your EIN is in hand. Bring the approved Articles of Organization, the EIN letter, and your operating agreement, because banks vary in what they ask to see. Some banks let you open the account online, others want a branch visit.

The point of the separate account is separation. Business income goes in, business expenses come out, and personal spending stays in your personal accounts. That clean record helps at tax time, it makes bookkeeping far simpler, and it supports the liability separation that was a main reason to form an LLC in the first place. Mixing funds in one account muddies all three. Courts and accountants both look unfavorably on mixed accounts when questions arise about whether the business was truly run as a separate entity.

Set up a simple bookkeeping habit too, even a spreadsheet at first. Record income and expenses weekly and keep receipts.

Step 8: Stay in compliance

Forming the LLC is the beginning, not the end, of your state obligations. Most states require an annual report, and a few require a report every two years. The report confirms your name, address, and registered agent, and it carries a state fee in most states. Some states set a fixed filing date for every LLC. Others set the deadline by the month you formed. A handful of states have no annual report at all, though they may have a recurring tax or fee instead.

Missing a report has real consequences. States charge late fees, then mark the LLC as not in good standing, and eventually dissolve it administratively if reports stay unfiled. A dissolved LLC loses the standing that banks, customers, and courts expect, and reinstating it costs more than filing on time would have.

Build your personal list of dates now, while the formation is fresh. Our LLC compliance calendar shows the report rules and fee for your state and helps you note the dates that apply to your business. Add reminders a month before each deadline. Also keep your registered agent information current with the state whenever your agent or address changes, because missed legal papers are among the most serious compliance failures a small business can have.

Finally, remember that an LLC is a state creation. It does not by itself handle your local business licenses, your sales tax registration, or your industry permits. Check your city and county requirements, and register for state taxes if you will collect sales tax or hire employees. Once those pieces are in place, your LLC is formed, funded, documented, and ready to operate with its paperwork in order.