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Steps to Set Up an LLC

    Select a State

    • Choose a state in which to set up your LLC. Many LLCs are formed in the home state of their members, but different states have different rules and fees for setting up LLCs. Delaware and Nevada are popular states for LLC creation because of business-friendly laws and low LLC filing fees. Consider consulting a lawyer about whether to set up your LLC in your home state or elsewhere.

    Select a Name

    • Select an available name. Some states have naming conventions for LLCs, but all LLC names end in "Ltd." or "LLC." Each state has a secretary of state website where you can search for LLC names that are already taken.


    • File articles of organization, which you can find on your state's secretary-of-state website. This document is a template that you must use to create your LLC. Articles of organization provide the name of the LLC and the names of its members and its registered agent, i.e., the person who will receive legal notices on behalf of the LLC.

    Execute Member Agreement

    • Execute a member operating agreement. All LLCs should have a written operating agreement, even single-member LLCs. Multi-member LLCs especially need them, because the agreement spells out ownership percentages, compensation rates and management duties among the members.

    Do Some Research

    • Your LLC is officially set up, but you still have some research to do. Many industries, such as food service, retail, and professional services, have additional licenses and permits that you will need to operate. Check with the state where you will be operating your LLC to find out what licenses and permits you may need.

    Get an EIN

    • Get an Employer Identification Number, or EIN. This is also your LLC's tax ID number. File form SS-4 with the Internal Revenue Service (IRS) to obtain an EIN for your LLC. You will need this number to open a bank account and process your taxes.

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