How to Form an LLC in Indiana The Right Way: Costs, Steps, and Tips

Once you have decided to form a new LLC in Indiana there will be a set of guidelines you will need to follow to start and keep your business in good standing with the state. To enjoy the many advantages that LLCs offer to business owners keeping the business in good standing is one of the main factors in maintaining an active business, which starts with the formation process. LLCs are one of the most popular business types due to the benefits they offer businesses, including small businesses, since they offer advantages such as ease of formation, flexibility of ownership and changes to the business, and the protections the owners of the LLC receive.

For an LLC in Indiana, the list of activities you will need to complete in order to correctly form a new business will include:

1. Choosing a business name - Your business name is required to be unique and distinguishable from other active businesses in the state and include a designator such as "LLC" or "Limited Liability Company".

2. Appoint a registered agent - All LLCs formed in Indiana will need to have an active registered agent with a current physical street address in the state and be available at this address during regular business hours.

3. Submit your Articles of Organization - This document will officially form your LLC with the Indiana Secretary of State. It will include the business information, registered agent information, and ownership information of the LLC.

4. Draft an operating agreement - An operating agreement will detail the roles and responsibilities of the owners of the LLC, as well as how the business will deal with certain processes.

5. Obtain an EIN - The EIN will be issued by the IRS and is required for conducting business operations such as filing taxes, hiring employees, and opening a business bank account.

6. Maintain ongoing good standing - After the formation process, LLCs are required to submit business entity reports every 2 years to update their information and keep the business in good standing.

This guide will inform new business owners on how to correctly form their LLC in Indiana, how to maintain good standing for their LLC, and the list of operations they will need to complete in order to ensure the guidelines set by the state are met. You can either choose to submit these documents on your own or you can hire a service like Firstep to complete this process for you. If you decide to do this on your own, this simple guide will cover the basic steps new business owners will need to follow.

Step 1: Choosing a Business Name

The first step of forming a new LLC in Indiana will be to choose a business name. Your name will need to be unique and distinguishable enough from other businesses in the state to be approved. The name of your business will be a key aspect of your business and it is helpful to choose a name that relates to your business operations. This will make it more likely for customers to remember your business and be repeat customers. While brainstorming potential names, you can use the business name search tool to check to see what names are available. In Indiana, there will be a hold on business names that have been administratively dissolved for 120 days, but there is no hold if the business voluntarily dissolved themselves.

The LLCs name will need to include a designator such as "LLC" or "Limited Liability Company", and changing this designator will not make it unique enough from another active business with your chosen name.

Step 2: Appoint a Registered Agent

Any LLC that is formed in Indiana will be required to have an active registered agent. A registered agent will be responsible for receiving any service of process or important documents sent to you by the state. A registered agent in Indiana can be anyone you choose as long as they meet the requirements set by the state. These requirements include:

• Be at least 18 years old

• Have an active physical address in the state of Indiana

• Be available during regular business hours (Monday-Friday 9am-5pm)

The registered agent's name and physical address will also be included on the LLCs Articles of Organization, which is public information. If you choose to act as your own registered agent, this will need to be your personal address. To avoid this, you can choose to appoint a trusted friend or family member to be your registered agent or you can hire a service such as Firstep to do this for you. Doing this can also be beneficial for business owners who are mobile or have multiple locations as it will be very difficult to be at your listed address during these regular business hours.

Step 3: Submit Your Articles of Organization

With your business name and registered agent chosen, you are now ready to officially file your Articles of Organization with the Indiana Secretary of State. To do this you will need to go to the Secretary of State website and select the start a new business tab, choose the domestic LLC option, and enter your chosen business name. This tool will be helpful as this will do an initial search on the state database to determine if any businesses are currently using this name. Once you have approval for using your selected business name, you will be required to enter:

• Business information including a business email, effective date, duration, and principal office address information

• Registered agent information such as a physical address, name, and email

• Choose whether your LLC will be member managed or manager managed, and if you will have a single member LLC

• Enter the governing person information

• Attach any additional documents required for your filing

• Review the information you have entered so far to ensure there are no mistakes

• Sign the Articles of Organization to authorize the document

• Submit your payment of $97

The Indiana Secretary of State will typically process these filings in about 1-2 business days, but can vary depending on how busy the state is at the time. Approval will be sent via email once your document has been approved, or you can download your Articles of Organization directly from the state website. If you choose to hire Firstep to take care of this process for you, we will send over your certified documents once the formation is approved.

Step 4: Draft an Operating Agreement

Now that your LLC has been officially formed in Indiana, a highly suggested next step will be to draft an operating agreement for your business. An operating agreement will detail the roles and responsibilities of the owners of the business, the ownership percentages, voting rights, and processes for decision making within the LLC. This document will also outline how members will contribute to the business and the management structure of the LLC. While these documents are not required by law in Indiana, they are extremely helpful for business owners to have in place.

An operating agreement will not be filed with any government agency, as they are mainly for the internal use within the LLC. Although, you may be required to present this document when you are forming a business bank account. As your business grows and starts to scale it can be very helpful to have an operating agreement to detail certain processes such as members joining and leaving the business or how the LLC will be dissolved if the members choose to do so. The operating agreement will set a clear written outline for how your business will handle certain situations as well as how it will operate during its lifespan.

Step 5: Obtain an EIN for Your LLC

With your now formed and you have an operating agreement drafted, the next step will be to obtain an EIN for your business. An EIN (employer identification number) will be issued to you by the IRS, and will act as a social security number specifically for your business. This number will be used for filing taxes, hiring employees, and opening a business bank account. Since you will most likely be required to do all these things when forming an LLC, an EIN number is needed for most businesses. EINs will only be issued to each business one time, so it's important to download and save these documents once you obtain them.

When you are filling out the application for an EIN, you will need to ensure all the information you enter will need to be exactly as it is shown on your Articles of Organization. This helps to avoid having your application denied and having to go through any long wait times to get your EIN number. You are able to either choose to get the EIN on your own, or you can have a service like Firstep get this for you so you can focus on your business operations instead.

If you do happen to lose the documents or forget your EIN, you can still retrieve this through the IRS. However, it can be a lengthy process to do this so it's important to get this started before tax season or any important business deals are done. This process will require you to fill out specific forms through the IRS, and you will need to provide personal identification to prove you are an authorized member of the LLC. Similar to initially obtaining your EIN, you are able to choose to go through this process on your own or you can have a service like Firstep retrieve your EIN for you and handle the correspondence with the IRS.

Step 6: Maintain Ongoing Good Standing For Your Indiana LLC

Now that your new LLC has been formed in Indiana, you have an operating agreement, and an EIN, one of the most important things business owners will need to do is maintain the good standing of the business. These tasks will include completing activities such as filing business entity reports and registering for any required business licenses that may be needed by businesses in your industry.

Business Entity Reports (BER)

All LLCs that are formed in Indiana will be required to file a business entity report to keep the business in good standing. To file these, you will need to go to the Indiana Secretary of State website, and select file my business entity report. You will need to have your business name or business ID to bring up your filings, and these require you to enter your business information, registered agent information, governor information, and provide a signature to authorize it. The cost to file your report will be $32 to file yourself online, or you can have Firstep take care of this for you each year so you never miss a report. The filing due date for Indiana LLCs is the end of the original filing month every 2 years. It's important to keep up on these dates as missing a report can lead to administrative dissolution and cause your business to go inactive.

Business Licenses

Depending on the industry your business is in, you may be required to register for certain business licenses to stay compliant with the state guidelines. These are typically filed on the local level and not with the secretary of state, so it's important to know if you will need to do this or not. Most specialized professional services will need to do this, including industries such as healthcare, construction, law, and insurance. Make sure to register for these once your LLC has been formed so you are able to continue to operate in good standing and stay active.

FAQs on Indiana LLCs

Where do I go to form and maintain my Indiana LLC

To form a new LLC in Indiana you will need to go to the Indiana Secretary of State website and select start a new business. To maintain and stay in good standing, you will need to file business entity reports every 2 years and these will be done through the same website.

Can I form an LLC in Indiana if I don't live in the state

Yes, you can still form an LLC even if you don't live in Indiana. However, you will be required to have a registered agent that has a current physical address in the state to be considered in good standing and have your Articles of Organization approved.

Am I legally required to have an operating agreement for my LLC in Indiana

No, you are not required to have an operating agreement legally for you Indiana LLC. But, drafting an operating agreement is highly recommended to detail the roles and responsibilities of the owners of the business along with

What is the exact date that my LLC will have business entity reports due

LLCs in Indiana will be due by the end of their original filing month every 2 years. These reports will cost $32 to file yourself online, and will be one of the requirements for staying in good standing.

How much does it cost form and keep an Indiana LLC in good standing

The total cost to submit the Articles of Organization in Indiana will be $97 if you choose to file online yourself. After formation, you will need to submit business entity reports every 2 years which will cost $32 each time if you file online on your own. Firstep can handle both the formation and renewal of your business for you to ensure you do not miss any reports and correctly form your business.