Overview
Getting an LLC in Arkansas involves a straightforward process. Below, we’ll guide you through the essential steps and provide factual answers to common questions.
How To Get An LLC In Arkansas: Step-By-Step
- Choose a Name for Your LLC:
- Choose a unique and available name for your LLC.
- Perform an Arkansas LLC name search through the Arkansas Secretary of State website.
- Reserve your chosen name if needed.
- Registered Agent:
- Appoint a registered agent with a physical address in Arkansas.
- File Certificate of Organization:
- Complete the Arkansas LLC Certificate of Organization form.
- File online through the Arkansas Secretary of State website or submit a paper application.
- Operating Agreement:
- Draft an operating agreement outlining the structure and operation of your LLC. Although not required by the state, it is highly recommended.
- Employer Identification Number (EIN):
- Obtain an EIN from the IRS for tax purposes.
- File the Beneficial Ownership Information Report:
- Beginning in 2024, Arkansas LLCs must submit a Beneficial Ownership Information (BOI) Report.
1. Choose A Name For Your LLC
Check if the name you desire for your Arkansas LLC is available in the state. This is important because no two businesses in Arkansas can share the same name.
To do this, use the Arkansas Secretary of State’s search tool to compare your business name with existing ones in Arkansas.
Make sure your LLC name is unique by following Arkansas’s naming rules to increase the chances of your LLC name being approved.
If you need, you can reserve the name for your LLC for up to 120 days. The cost is $25 by mail (or $22.50 online).
2. Appoint Registered Agent
In Arkansas, you need to choose a registered agent for your LLC. This is the person or company allowed to get legal papers and important notices on behalf of your LLC.
Your registered agent can be a person, like yourself or one of your employees, or a company that offers this service.
The registered agent has to meet some requirements:
- If it is a company, it must offer registered agent services.
- The agent must have an address in Arkansas.
- The agent must be there in person and ready to get documents during regular business hours.
3. File Arkansas LLC Certificate of Organization
To officially establish your Arkansas LLC, you need to file the Arkansas LLC Certificate of Organization.
This document provides essential details about your LLC and serves as the official registration.
To prepare the certificate, gather the following information: your LLC name, the name and address of the registered agent, specify the type of your LLC business, and provide the effective date if different from the filing date.
The form is a straightforward online submission or can be sent by mail.
The Arkansas LLC Certificate of Organization filing fee is $50 ($45 if filed online).
Once filed, the Arkansas Secretary of State will review the document, and upon approval, your LLC attains legal business entity status.
You can undertake this process independently using our step-by-step guide or opt for the convenience of hiring a company for assistance.
>> Get the Northwest Registered Agent $39 Deal <<4. Create An Operating Agreement
An operating agreement is a document that shows how your LLC will do business.
While Arkansas doesn’t make it a must, having one is crucial. It helps in different ways, like resolving money disputes or potential legal issues. Without it, the courts decide based on state laws, not necessarily what’s best for the LLC.
The agreement can include things like the LLC’s name, address, how long it will last, the registered agent’s details, info from the Certificate of Organization, the business’s purpose, member contributions, how profits and losses are shared, rules for new and leaving members, how the LLC is managed, and clauses about protection and responsibility.
5. Obtain Employer Identification Number (EIN)
The Internal Revenue Service (IRS) gives your LLC a nine-digit number called an Employer Identification Number (EIN) to identify it for taxes. You can get your EIN by mail or online through the IRS.
This number helps you:
- File and handle taxes at both the state and federal levels.
- Open a bank account for your business.
- Apply for permits and licenses.
- Hire employees.
Obtaining an EIN is FREE.
7. File The Beneficial Ownership Information Report
Starting in 2024, many Arkansas LLCs must submit a Beneficial Ownership Information (BOI) Report to the Financial Crimes Enforcement Network (FinCEN).
This is a new rule, and the deadlines can be a bit confusing. For LLCs created in 2024, the report is due within 90 days of registering with the Arkansas Secretary of State.
If your LLC was registered before 2024, you have until January 1, 2025. LLCs established in 2025 or later must file within 30 days of formation.
The BOI Report requires details about the person who filed your Certificate of Organization (your LLC organizer) and all individuals with at least 25% ownership or substantial control over your LLC’s operations and finances.
Review: What Is Needed To Form An LLC In Arkansas?
To form an LLC in Arkansas, you need:
- A unique LLC name.
- Certificate of Organization
- Registered Agent information.
- Operating Agreement (recommended).
- Employer Identification Number (EIN).
What Forms Do You Need To Get An LLC In Arkansas?
- Certificate of Organization (online)
- Certificate of Organization (PDF)
- Application to Reserve LLC Name
- EIN Application Form
- BOI Form
How Much Does It Cost To Start An LLC In Arkansas?
The cost to start an LLC in Arkansas involves several steps, each with its own associated fees:
- Certificate of Organization Filing Fee: $50 (or $45 if filed online)
- Name Reservation Fee (if needed): $25 by mail (or $22.50 if filed online)
What Is A Franchise Tax Report?
In Arkansas, LLCs need to submit a Franchise Tax Report annually. This report, despite the name, is a fixed fee of $150 for all Arkansas LLCs. It helps the state stay informed about your business’s contact details and ownership.
How Long Does It Take For An LLC To Get Approved In Arkansas?
If you send your LLC application by mail, it will be approved in 15-20 business days, plus the time it takes for the mail (4-5 weeks in total).
However, your LLC can be approved in 3-7 business days if you file online.
What Are The Benefits Of An LLC In Arkansas?
- Limited liability protection for members
- Pass-through taxation
- Flexible management structure
- Credibility for business transactions
Is Arkansas A Good State To Form An LLC?
Whether Arkansas is the right state for your LLC depends on where you live and do business. If you live or operate in Arkansas, it makes sense to start your LLC there.
How Much Tax Does An LLC Pay In Arkansas?
The LLC doesn’t pay federal taxes directly. Instead, the money the business makes goes to the owners, and they report it as their personal income on their taxes. The owners of the Arkansas LLC get taxed at a 15.3% federal self-employment tax rate plus the individual tax rate in Arkansas.
Also, all LLCs pay the Franchise tax of $150 annually.
Getting An LLC In Arkansas: Next Steps
Once your LLC is registered, you can:
- Get the permits and licenses you need for your business, like health or zoning permits.
- Register your business with the state’s tax agency.
- Open a business bank account.
- Apply for a business credit card.
- Buy insurance for your business.
- Safeguard your name and logo with a trademark.
To maintain your LLC in Arkansas, you must:
- Update any changes to the registered agent or business address promptly.
- Pay Taxes (owners file their individual tax returns).
- File a Franchise Tax Report and pay $150 every year.
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Conclusion
Forming an LLC in Arkansas involves a few key steps, from name reservation to obtaining an EIN.
Carefully following the process ensures a smooth establishment of your LLC.
For more detailed information and to access the necessary forms, visit the Arkansas Secretary of State website.
