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A limited liability company (LLC for short) is a way to legally structure a business. It combines the limited liability of a corporation with the flexibility and lack of formalities provided by a partnership or sole proprietorship. Any business owner who seeks to limit his or her personal liability for business debts and lawsuits should consider forming an LLC. Here are the steps you need to take to form an LLC in Indiana. For more information on how to form an LLC in any state, see Nolo's article How to Form an LLC.
Under Indiana law, an LLC name must contain as the last words, "Limited Liability Company," "L.L.C.," or "LLC." The name may (but need not) contain the name of a member or manager.
Your LLC's name must be recognizably different from the names of other business entities already on file with the Indiana Secretary of State. Names may be checked for availability by searching the Indiana Secretary of State business name database. You may reserve a name for up to 120 days by filing a Reservation of Business Name with the Secretary of State. The reservation must be filed online. The filing fee is $20.
Using an Assumed Business Name
You don't have to use your LLC's official legal name registered in your Articles of Organization when you do business out in the real world. Instead, you can use an assumed business name, also called a fictitious business name, "DBA" (short for doing business as), or trade name. To do so in Indiana, you must register your assumed name with the Indiana Secretary of State. You may register online, or by postal mail by filing a Certification of Assumed Business Name. The filing fee is $20 ($30 for filings by mail).
Every Indiana LLC must have an agent for service of process in the state. This is an individual or business entity that agrees to accept legal papers on the LLC's behalf if it is sued. A registered agent may be an individual who resides in Indiana, or a domestic or foreign business entity authorized to do business in Indiana. The registered agent must have a physical street address in Indiana.
An Indiana LLC is created by filing Articles of Organization with the Indiana Secretary of State Business Services Division. The articles must include:
The articles may be filed online or by postal mail. The filing fee is $100.
An LLC operating agreement is not required in Indiana, but is highly advisable. This is an internal document that establishes how your LLC will be run. It sets out the rights and responsibilities of the members and managers, including how the LLC will be managed. It can also help preserve your limited liability by showing that your LLC is truly a separate business entity. In the absence of an operating agreement, state LLC law will govern how your LLC operates.
For help creating an LLC operating agreement, see Form Your Own Limited Liability Company, by Anthony Mancuso (Nolo) or use Nolo's Online LLC. If an operating agreement is created, it need not be filed with the Articles of Organization.
If your LLC has more than one member, it must obtain its own IRS Employer Identification Number (EIN), even if it has no employees. If you form a one-member LLC, you must obtain an EIN for it only if it will have employees or you elect to have it taxed as a corporation instead of a sole proprietorship (disregarded entity). You may obtain an EIN by completing an online application on the IRS website. There is no filing fee.
All LLCs doing business in Indiana must file a Business Entity Report with the Secretary of State every two years. The report is due every other year in the anniversary month of your LLC's formation. For example, if your LLC was formed on July 15 of an odd-numbered year, then your report would be due in July of each subsequent odd-numbered year. The report can be filed online or by mail. The filing fee is $50 for filings by mail and $32 for online filings. For more information on Indiana biennial report requirements, see Nolo's article Indiana LLC Filing Requirements.
Should I form an LLC?If you are just starting your business or have already been operating as a sole proprietor, you should consider forming an LLC. LLCs limit an owner's personal liability for business debts and lawsuits and offer a lot of flexibility when it comes to ownership, management, and taxation of the business. To learn more about LLCs and decide if it is the right business structure for you, see What is a Limited Liability Company (LLC)?
How do I know if my LLC name is available?It is important to make sure that your LLC's name is distinguishable from the names of other existing businesses on file with the Indiana Secretary of State. You can conduct a name search for free on the Indiana SOS website to make sure your proposed name is available.
How much does it cost to form an LLC in Indiana?Filing on your own is often the cheapest option, but completing all of the forms and filing them yourself can be complicated. Hiring a lawyer is another option, but will often cost you hundreds, if not thousands, of dollars in the process. Nolo's Online LLC formation service can complete all of the paperwork and filings for you, with packages starting at just $49.00. To learn more about the costs associated with forming and running an LLC, see How Much Does It Cost to Form an LLC?
Do I need an operating agreement for my Indiana LLC?Indiana does not require LLCs to have operating agreements, but it is highly advisable to have one. An operating agreement will help protect your limited liability status, prevent financial and managerial misunderstandings, and ensure that you decide on the rules governing your business instead of state law by default. For more information, see The LLC Operating Agreement.
Do I need a business license?Depending on its type of business and where it is located, your LLC may need to obtain other local and state business licenses. For local licenses, check with the clerk for the city where the LLC's primary place of business is located (or county if it is in an unincorporated area). For state license information, check the Indiana Department of Business and Agriculture Business Owner's Guide. For more information, refer to Nolo's article How to Get a Small Business License in Indiana.
Are there Indiana business taxes I need to pay?In some cases, for example if you will be selling goods and collecting sales tax or if you have employees, you'll need to register with the Indiana Department of Revenue (DOR). You can register either online or on paper (Form BT-1, Business Tax Application). For more information on Indiana LLC tax registration, see Nolo's article Indiana LLC Filing Requirements.
Can a foreign LLC do business in Indiana?To do business in Indiana, all LLCs organized outside of the state must register with the Indiana Secretary of State. Foreign LLCs must appoint a registered agent for service of process physically located in Indiana. To register, file a Foreign Registration Statement. The Statement may be filed online or by mail. The filing fee is $125.
The completed application must be accompanied by a Certificate of Good Standing or Existence from the foreign LLC's home state, dated nor more than 60 days prior to the filing of the certificate.
Can I form a single-member LLC in Indiana?For most formation purposes, a Indiana single-member LLC is considered the same as a multi-member LLC. The steps to form a single-member LLC in Indiana are the same as those listed above.
Single-member LLCs do have additional flexibility when it comes to filing a tax return. To learn more, see Nolo's article, How Single-Member LLCs Pay Federal Income Tax.
Can I form a professional LLC in Indiana?If you provide a licensed professional service in Indiana and want to form an LLC, you will be required to form a professional limited liability company (PLLC). Examples of professional services include architects, attorneys, dentists, certified public accountants, and more. Generally, if you provide a service that requires you to obtain a Indiana state license before practicing, then you are a professional service. Under Indiana law, LLCs can be formed to provide professional services. However, only one specific type of service may be provided and all the owners of the LLC must be licensed or registered to perform the professional service for which the LLC was organized.
To learn more about forming a Indiana PLLC, see our article, How to Form a Professional LLC in Indiana.
How do I dissolve my LLC when I'm done?If you reach the point where it is time to close your business and cease all operations, then you will want to properly dissolve your LLC to limit your liability for lawsuits and government fees. Learn about the steps you will need to take.