How to Start an LLC in 6 Practical Steps
The legal LLC is created when your state accepts the required formation filing. But a well-set-up LLC also needs the right name, registered agent, operating rules, tax ID when needed, separate finances, and ongoing compliance.
How do you start an LLC?
Start by choosing the state where the business should be formed, checking an available LLC name, appointing an eligible registered agent, and filing the state's LLC formation document with the required government fee. After approval, create the operating agreement, obtain an EIN when needed, separate business finances, and calendar the LLC's tax, license, registered-agent, and recurring state-filing obligations.
Before You Start: Should You Form an LLC?
An LLC can be a strong fit when a business has meaningful contracts, customers, revenue, employees, co-owners, property, borrowing, or liability exposure. It can also make sense when owners want a formal state-law entity with flexible management and federal tax-classification options.
But an LLC is not automatically necessary for every activity, and limited liability is not absolute. Before paying a state filing fee, compare the LLC with a sole proprietorship, partnership, or corporation and consider your state costs, insurance needs, tax situation, ownership structure, and future plans.
Use Do I Need an LLC? if you are still deciding, or What Is an LLC? if you want the legal and tax concepts first.
Step 1
Choose Your LLC Name
Your LLC name must satisfy the rules of the jurisdiction where you form it. States typically require an LLC designator such as “LLC” or “Limited Liability Company,” require the name to be distinguishable from existing registered names under that state's standard, and restrict certain words or regulated terms.
Name reservations are state-specific. Some states offer or require reservation in particular circumstances; others let you proceed directly to formation. Do not pay for a reservation unless it serves a real purpose in your state and timeline.
Step 2
Appoint a Registered Agent
LLCs generally must maintain a registered agent, statutory agent, resident agent, or equivalent contact in the formation state. The agent receives service of process and official state communications. Address, availability, consent, and eligibility rules are state-specific.
Serving as your own agent can reduce service cost, but it can create availability and privacy trade-offs. A commercial registered-agent service is optional when you otherwise qualify to serve yourself.
Read What Is a Registered Agent? or compare registered-agent services.
Step 3
File the LLC Formation Document
The document is often called Articles of Organization, but some states use names such as Certificate of Formation or Certificate of Organization. The filing authority also varies by jurisdiction.
State formation fees vary widely and can change. Enjoys-life maintains the fee baseline in one governed location: LLC Filing Fees by State. Do not use a second hardcoded fee database on this page.
Learn what Articles of Organization contain →Step 4
Create Your Operating Agreement
An operating agreement can document ownership percentages, management authority, voting, distributions, member departures, transfer restrictions, dissolution rules, and other governance terms. Whether it is legally required, and what rules apply if you do not have one, depends on the state and the LLC's circumstances.
Enjoys-life's own templates are the free operating-agreement resource promoted here. Start with the LLC Operating Agreement guide and templates. More complex ownership, investor, professional, estate-planning, or tax arrangements can justify individualized legal advice.
Step 5
Get an EIN When You Need One
An Employer Identification Number is a federal tax ID. The IRS says to form the legal entity with the state first, then apply for the EIN. An EIN is required in many situations, including when the business has employees or when an entity's federal tax filing requirements require one. Even when a single-member LLC does not need an EIN for federal income-tax purposes, the IRS says it may request one for banking or state-tax purposes.
The IRS EIN application itself is free. A private provider can charge for assistance, but that is a convenience/service fee—not an IRS fee. See Enjoys-life's EIN guide.
Step 6
Separate Business Finances and Records
After formation, create a practical separation between the LLC and its owners. A dedicated business bank account is one of the clearest ways to keep company income and expenses separate from personal activity. Bank requirements differ, so check the institution's current documentation requirements.
A bank account is not what legally creates the LLC, and commingling does not automatically produce the same legal result in every dispute. But clean separation is an important governance, accounting and risk-management practice.
LLC Formation Readiness Planner
Use this page-specific checklist before you submit the filing. It does not replace your state's instructions; it helps you identify which preparation steps are still incomplete.
0 of 8 preparation items complete
Start with the formation state, name rules and registered-agent requirements before completing the state filing.
This planner deliberately does not calculate state fees or deadlines. Those volatile facts belong in Enjoys-life's governed state-data layer and state-specific guides.
What Does It Cost to Start an LLC?
The mandatory and optional costs depend on the jurisdiction and the business. The state formation filing fee is a core formation cost, but it is not always the only required expense. Some jurisdictions or business types can involve publication, initial reports, taxes, licenses, registered-agent arrangements, or other required costs.
| Cost layer | Required? | How to treat it |
|---|---|---|
| State LLC formation filing fee | Required | Use Enjoys-life's governed Filing Fees by State data. |
| Registered-agent role | Generally required | Service fee can be $0 if you legally serve yourself; commercial service is optional. |
| Operating agreement | State/circumstance dependent | Enjoys-life provides its own free templates; complex cases can require professional help. |
| EIN application | Depends on federal/business needs | $0 from the IRS. |
| Annual/biennial reports and state taxes | State dependent | Recurring ownership/compliance layer; do not call it the formation filing fee. |
| Licenses, publication, permits, professional help | Business/location dependent | Separate required or optional layer depending on the facts. |
For a state-by-state filing-fee baseline, use LLC Filing Fees by State. For a broader projection that separates formation from ongoing ownership costs, use the LLC Total Cost Calculator.
Which State Should You Form the LLC In?
For many owner-operated businesses, forming in the state where the business is actually based is the simplest starting point. Forming elsewhere can create additional foreign-qualification, registered-agent, tax, and recurring compliance obligations when the LLC also does business in another state.
But the legal test for “doing business” or “transacting business” is state-specific, and specialized structures—such as multi-state operations, institutional investment, real estate holdings, privacy planning, or regulated businesses—can justify a different analysis. Avoid universal “Wyoming is always best” or “Delaware is always best” claims.
Use Best State to Form an LLC for the decision framework and your state-specific guide for the actual filing rules.
How Will the LLC Be Taxed?
An LLC is a state-law entity, not one universal federal tax status. The IRS generally treats a domestic single-member LLC as disregarded for federal income-tax purposes unless it elects corporate treatment. A domestic LLC with at least two members is generally classified as a partnership unless it elects corporate treatment.
An eligible LLC can elect corporate and, if it meets the requirements, S corporation tax treatment. Whether an S election saves money cannot be reduced to one universal profit threshold: compensation, payroll costs, state taxes, deductions, owner participation and other facts can materially change the result.
Do not form an LLC solely because someone quoted a tax percentage. Entity formation and tax classification are separate decisions. See LLC Taxes and LLC Taxed as an S Corp.
After Formation: Keep the LLC in Good Standing
State approval is the beginning of the LLC's compliance life. Depending on the jurisdiction and business, ongoing work can include:
- annual or biennial reports and related state fees;
- maintaining an eligible registered agent and current address;
- state and local tax registrations and payments;
- business licenses and professional/industry permits;
- separate financial records and internal governance documents;
- insurance appropriate to the business's risks; and
- foreign qualification when the LLC conducts business in another jurisdiction under that jurisdiction's rules.
Current BOI rule: FinCEN's current guidance states that entities created in the United States, including entities formerly called domestic reporting companies, and their beneficial owners are exempt from BOI reporting under the Corporate Transparency Act. Because this area changed substantially in 2024–2025, Enjoys-life should continue monitoring FinCEN rather than treating the rule as permanently fixed.
Use the LLC Annual Report / Ongoing State Filing Compliance guide for the recurring state-filing layer.
Want Northwest to Handle the State Filing?
You can file directly with your state yourself. If you prefer a filing service, Northwest Registered Agent currently advertises LLC formation for $39 plus the required state fee, with registered-agent service included for the first year of its formation package. Standalone registered-agent service is currently advertised at $125 per year.
See Northwest's Current LLC Offer →Disclosure: Enjoys-life may earn a commission if you use this link, at no extra cost to you. Northwest is optional and is not a government agency. Pricing and package inclusions can change, so verify the current checkout before purchasing.
Sources & Verification Method
This national guide intentionally avoids duplicating all 50 states + DC's volatile formation fees, processing times, deadlines, and filing authorities. Those facts belong in Enjoys-life's Master Fact Registry and state-specific pages. Federal claims below are anchored to current primary sources.
This guide separates the legal formation event from post-formation setup, keeps state-specific volatile facts in Enjoys-life's governed data layer, and uses primary federal sources for EIN, tax-classification and BOI guidance.