Iowa experienced a surge in new business registrations in 2021, with many individuals opting to establish LLCs in the state. While starting an Iowa LLC may appear daunting, it’s more straightforward than you imagine. This guide is here to help you, offering a step-by-step walkthrough of the required forms and requirements while highlighting key considerations. By the end, you’ll confidently start your own LLC in Iowa, enjoying the benefits of this business organization.
Step 1: Name your Iowa LLC
Step 2: Choose a Registered Agent
Step 3: File an Articles of Organization
Step 4: Received a Certificate From the State
Step 5: Create an Operating Agreement
Step 6: Get an Employer Identification Number
Step 1: Name your Iowa LLC
When starting an LLC in Iowa, you’ll need to choose a name that follows Iowa’s naming rules:
- Include “limited liability company” and “LLC” in your business name.
- Ensure your name is unique and not already used by another Iowa business. You can verify this information using the Secretary of State’s online platform.
- Avoid using words that suggest your business is a government agency.
- Some words, such as “bank,” “lawyer,” “attorney,” “credit union,” etc., may require extra paperwork or licenses. Iowa’s naming rules are on its official website.
Additional considerations:
Reserve your name: If you have a business name in mind but have yet to register it, Iowa lets you reserve it with the Iowa Secretary of State for 120 days. Reserving a name doesn’t guarantee that it will be approved, but it stops anyone else from using it during that time.
Website domain: Even if you plan to wait before creating a webpage, securing your domain name is a good idea now. Before settling on your LLC name, check if your desired URL is available and suitable.
Step 2: Choose a Registered Agent
You need to choose a registered agent for your LLC. This agent can be a person or a company that gets legal papers if your LLC gets sued. The registered agent can be an Iowa resident, an Iowa business (profit or nonprofit), or a company from another place allowed to do business in Iowa. Sometimes, the Iowa Secretary of State acts as the agent for legal papers.
Also, most businesses in Iowa must have an official office. This office needs to have a confirmed address, not a P.O. Box. The registered agent’s office address must be the same as the official office address.
Step 3: File an Articles of Organization
To create an Iowa LLC, you must file an Articles of Organization with the Iowa Secretary of State. Unlike some states, Iowa has no form you can download or complete online. Instead, you must make your own or get a lawyer to help you. The certificate must include:
- The LLC’s name
- The LLC’s address
- Name and address of the registered agent
You can file the certificate online or by mail. It costs $50.
Step 4: Received a Certificate From the State
Once the LLC’s formation documents are submitted and approved, the state will issue a certificate to confirm your LLC’s existence.
This certificate enables the LLC to obtain an Employer Identification Number (EIN), business licenses, and a bank account.
Step 5: Create an Operating Agreement
This agreement is a document that outlines how your LLC will operate.
While Iowa doesn’t require an operating agreement, it’s crucial for your business. Having one can help resolve disputes and potential issues. Without it, courts decide based on state law, which may not be best for your LLC.
The agreement can cover:
- LLC’s name and address
- How long the LLC will last
- Registered agent’s info
- Business purpose
- Member contributions
- Profit and loss sharing
- Adding or removing members
- How the LLC manages its operations
- Protection from liability
Step 6: Get an Employer Identification Number
You must get an Employee Identification Number when starting an LLC in Iowa. Getting the number is free, and you can apply to the IRS online or by mail. You’ll need this number to:
- Get a business line of credit
- Open a business bank account
- Hire employees
LLC State Guides
FAQs
What is the cost of starting and maintaining an LLC in Iowa?
Starting an LLC in Iowa costs $50, and hiring a registered agent in the state costs $100 annually. You must also file biennial reports, which cost $60 by mail or $45 online.
Do Iowa LLCs file annual reports?
Iowa LLCs must submit reports every two years, usually by April 1 of each odd-numbered year.
What is the timeframe for filing an LLC in Iowa?
Mail filings typically undergo processing within 7-10 business days, while the Secretary of State’s office processes online filings within one business day.
