How to Start an LLC in 2025: 6 Simple Steps 

Thinking about starting your own business? Or, maybe you already have one and want to make it official? One of the first steps is choosing the right legal structure; and for many entrepreneurs, an LLC (Limited Liability Company) is the perfect option. However, figuring out how to start an LLC can feel overwhelming with all the legal jargon and paperwork involved.

Don’t worry, we’ve got you covered. In this guide, we’ll walk you through six simple steps to set up your LLC the right way. Whether you’re launching a side hustle, an online store, or a full-scale business, this step-by-step breakdown will help you navigate the process with confidence.

Let’s get started!

Step 1: Choose a Name for Your LLC 

Your LLC’s name is more than just a label—it’s your brand identity. Before you get attached to a name, you’ll need to make sure it meets your state’s requirements.

Here’s what to check for:

• Uniqueness: Your business name must be different from any other LLC registered in your state. Search your state’s business database to check availability.
• LLC Designation: Most states require your business name to include “LLC” or “Limited Liability Company.”
• Trademarks: Even if your name is available in your state, check the U.S. Patent and Trademark Office database to ensure it’s not federally trademarked.
• Domain Name Availability: If you plan to have a website, secure a domain name that matches your business name.

Step 2: Select a Registered Agent 

A registered agent is a person or service that receives legal and tax documents on behalf of your LLC. This is a crucial role because missing a legal notice could put your business at risk.

Who Can Be a Registered Agent?

• You: If you have a physical address in the state where you’re forming your LLC.
• A Friend or Family Member: As long as they meet the state’s requirements.
• A Professional Registered Agent Service: These companies handle legal notices and keep your address off public records for privacy.

Using a professional service is a great option if:

• You don’t want your home address listed publicly.
• You travel frequently and need a reliable point of contact.
• You’re forming an LLC in a state where you don’t live.

Step 3: Create an LLC Operating Agreement

An Operating Agreement is like a rulebook for your LLC. While not required in every state, it’s a smart move to have one in place.

Why Do You Need an Operating Agreement?

• Clarifies Ownership & Roles: Especially important if you have multiple members.
• Reduces Disputes: Outlines how decisions are made and how profits are shared.
• Strengthens Legal Protection: Helps prove your LLC is a separate entity from you personally.

What Should It Include?

• Member roles and responsibilities
• How profits and losses will be distributed
• Decision-making processes
• Procedures for adding or removing members
• Dissolution guidelines (what happens if you shut down the LLC)

Step 4: File Your Articles of Organization

The Articles of Organization is the official document that legally forms your LLC. This step varies by state, but here’s what you generally need:

What’s Included in the Filing?

• Business Name & Address
• Registered Agent Information
• Business Purpose (Some states require a brief description of what your business does.)
• Management Structure (Member-managed vs. manager-managed)

How to File

• Online: Most states allow you to file electronically.
• By Mail: Some states still require a paper application.
• Filing Fee: Typically ranges from $50 to $500, depending on the state.

After submitting your Articles of Organization, your state will process your application and issue a Certificate of Formation (or similar document), officially recognizing your LLC.

Step 5: Get an EIN and Business Bank Account 

What is an EIN?

An Employer Identification Number (EIN) is like a Social Security number for your business. You’ll need it to:

• File taxes
• Open a business bank account
• Hire employees (if applicable)

How to Get an EIN

• Apply online for free at the IRS website.
• Receive your EIN immediately after applying.

Opening a Business Bank Account

Once you have an EIN, you’ll want to keep your personal and business finances separate. A business bank account helps you:

• Protect your personal assets by maintaining corporate liability protection.
• Simplify taxes by keeping clear records of business income and expenses.
• Look more professional when dealing with customers and vendors.

To open an account, banks typically require:

• Your EIN
• A copy of your Articles of Organization
• Your LLC Operating Agreement

Step 6: Obtain All Necessary Licenses and Permits 

Depending on your industry and location, your LLC may need additional licenses and permits to operate legally.

Common Business Licenses & Permits:

• General Business License – Required in many states and cities.
• Sales Tax Permit – If you sell taxable goods or services.
• Professional Licenses – For businesses like law firms, medical practices, and real estate agencies.
• Home-Based Business Permits – If you’re running your LLC from home.

Check with your state and local government websites to ensure you have all necessary approvals.

LLC Resources

Several online resources can provide further guidance on forming and managing an LLC, including the Small Business Administration (SBA) website, legal service providers, and state-specific websites. Additionally, consulting with a business attorney or accountant can be invaluable.

What You Should Know About LLC Taxes

LLCs offer various taxation options. By default, they are treated as pass-through entities, meaning the business income passes through to the members’ personal tax returns. However, LLCs can also choose to be taxed as corporations. Understanding these options and their implications for your tax situation is crucial.

Wrapping Up: Do You Feel Confident in How to Start an LLC? 

We hope that our overview shows you that starting an LLC does not have to be scary or overwhelming. By following these six simple steps, you can confidently set up your business, protect your personal assets, and allow yourself to focus on what truly matters: growing and developing your business, without worrying about legal complications, etc. 

Now that you know how to start an LLC, are you ready to take the next step? Check out our trusted LLC formation partners to make the process even easier!

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