If you’re ready to learn how to start an LLC in Utah, you’re in the right place. Utah offers a range of benefits for new businesses, from Great Salt Lake to its flat-rate income taxes. Starting an LLC in Utah is easy. Just follow the steps, and you’re good to go.
#1: Name Your Utah LLC
#2: Hire Your Registered Agent
#3: File Your Certificate of Organization
#4: Receive Your Certificate From Utah State
#5: Create Your Operating Agreement
#6: Get Your EIN
#7: Keep Your Utah LLC Active
1. Name your Utah LLC
Naming your Utah LLC is your chance to be creative. Choose a name for your LLC before registering and search for Utah LLC to verify the availability of your chosen name. Here are the requirements when naming your business:
- Your business name should include the terms Limited Liability Company, LLC, or L.L.C.
- Your chosen name must be distinct from existing businesses in the state. Avoid using words resembling government agencies’ names, such as State Department, CIA, FBI, Treasury, etc.
- Certain restricted words like bank, lawyer, attorney, credit union, etc., may need additional documentation and licensure paperwork.
- Your business name should be unique and easily distinguishable from other businesses operating in Utah.
Learn the complete listing of the naming rules in Utah.
Reserve Your Utah LLC Name
If you have found the ideal name for your business and it is currently available, you can secure it by reserving it for a fee of $22. This reservation will prevent others from using the name while you navigate the process of starting your LLC in Utah. You will have a generous 120-day period before the reservation expires.
Additional consideration:
URL availability. Consider having a webpage, even if you believe it may not be necessary. Reserving the option to have a webpage in the future is a wise choice, and you can do so by purchasing your domain name now. Before making a final decision on your LLC name, check the availability of the corresponding URL.
2. Hire Your Registered Agent
In Utah, hiring or designating a registered agent for your LLC is mandatory. A registered agent is an individual or entity authorized to receive official legal documents and notices on behalf of your LLC. This includes service of process, which refers to the delivery of legal papers such as lawsuits, subpoenas, and other important documents.
When choosing a registered agent, you have the option of designating yourself as an employee of your LLC or using the services of a registered agent company. Regardless of the choice, you must follow the requirements:
- If you choose a registered agent service, an entity or company specializing in this role must provide it.
- The agent should have a physical address in the state of Utah.
- The agent must be present and available during regular business hours to accept documents for your LLC.
3. File Your Certificate of Organization
To operate as an LLC in any state, you must file a document that provides essential information about your business and register it within the state’s system. In Utah, people refer to this crucial document as the certificate of organization. It is important to include the following information when completing the Utah LLC certificate of organization:
- Utah LLC name
- Principal office address
- Registered agent’s name and Utah street address
- Signature of the organizer
In addition to these requirements, there are optional items you can complete, such as providing the names and addresses of the LLC members, specifying the duration of the LLC, and stating the purpose of the LLC.
Utah provides multiple filing options, including paper filing by mail or fax and online filing. The certificate of organization filing fee is $54.
You can check what the division handles to get an idea of the processing time. The estimated processing time for Utah LLC filings is around two weeks. However, expedited filing is available for an additional fee of $75 per filing if you need a faster turnaround. Choosing expedited filing will result in processing your application within two business days.
Once you submit your certificate, the Department of Commerce will review the filing. The LLC will be officially recognized as a legal business entity if the articles are deemed valid and meet the requirements.
4. Receive Your Certificate From Utah State
Once the LLC’s formation documents are filed and approved, you can ask for a copy of the certificate from the state. By paying the required postage, the state will mail you a certificate that officially confirms the LLC’s existence. This certificate is crucial as it enables the LLC to get an EIN and business license and open a business bank account.
5. Create Your Operating Agreement
While having an operating agreement for your Utah LLC is not mandatory, members should create one. This agreement serves as a record of important company decisions and outlines the business’s operational structure. The operating agreement covers a wide range of details, from minor aspects like choosing an anniversary date for the company to crucial decisions regarding the dissolution of the business. Common elements included in these agreements are:
- Member responsibilities and duties
- Management structure (member-managed or manager-managed)
- Voting procedures
- Procedures for admitting new members
- Guidelines for transferring membership
- Day-to-day business operations
- Description of liability
- Financial and accounting practices of the company
Even if your Utah LLC consists of a single member, it is still advisable to have an operating agreement in place. Unlike a business plan, which outlines proposals for a company, an operating agreement holds legal significance. It functions as a binding contract that all members are obliged to follow.
6. Get Your EIN
The Internal Revenue Service assigns a nine-digit Employer Identification Number (EIN) to identify your LLC for tax purposes. You can obtain your EIN either by mail or online through the IRS. While an EIN is only required for LLCs with multiple members or employees, having one can be advantageous for any LLC. This number enhances credibility with vendors and is sometimes necessary for making company purchases.
The application process for an EIN is free and straightforward. It is better to have an EIN and not require it than to need one and not have it!
The primary purposes of an EIN are as follows:
- File and manage taxes at the state and federal levels.
- Open a business bank account.
- Facilitate the hiring of employees.
7. Keep Your Utah LLC Active
Once you have successfully started an LLC in Utah, ensuring that your business remains compliant and active is crucial. This involves meeting the compliance standards set by the state of Utah and the county where your company operates.
File Annual Reports
You are required to file an annual renewal report to maintain your Utal LLC active status.
You must submit the report by the last day of your LLC’s anniversary month each year. The Department of Commerce will send a renewal notice 60 days before the report is due. The filing fee is $18, with a $10 penalty for late filings exceeding 30 days. You can conveniently file online within 15 minutes.
Failure to file the yearly report within 60 days will change your LLC’s status to “expired,” which cancels your business registration. To resume legal operations, you will need to reinstate the LLC. However, if the LLC remains expired for two years, reinstatement may not be possible.
File Required Tax Documents
An LLC itself does not have tax obligations. Instead, the Utah LLC passes its income through to its members, who pay taxes on their earnings. Utah’s income tax rate is a flat rate that varies from year to year.
If your LLC has employees, you will also need to fulfill federal and state employer tax obligations and unemployment taxes. The tax rates for these vary annually. Registering your business online will facilitate the filing process.
Set Up a Website and Social Media Accounts
It is essential to have a strong online presence. One of the first steps you should take after launching your Utah LLC is to purchase a domain name for your website. Additionally, ensure that you create social media accounts for your company. An online presence will help promote your business, attract customers, and make it easier for clients to find your products or services.
Now that you know how to start an LLC. It’s time to get your business up and running smoothly with this helpful guide. Follow the simple steps and set your Utah LLC on the right path.
LLC State Guides
FAQs About How To Start an LLC in Utah
The cost for the articles of organization is $70. Additionally, there is an annual report filing fee of $20 to ensure compliance and keep your LLC active. These fees are essential for starting your business entity in Utah.
The processing time depends on how you choose to file.
Submitting your articles of organization online allows for processing within a few business days. However, it may take longer if you choose to mail your filings. Additionally, expedited processing options are available for those needing a quicker turnaround with an additional fee.
Utah doesn’t mandate LLCs to have an operating agreement, but it’s highly advisable. This document outlines management, ownership, and procedures, providing clarity even for single-member LLCs. An operating agreement safeguards your limited liability status and clarifies your business’s internal workings.
A Professional LLC, also known as a Professional Service Company in Utah, is formed by members who hold special licenses required to perform the professional services offered by the company. Licensed professionals like attorneys, physicians, veterinarians, architects, and real estate agents commonly choose this structure.
• Limited Personal Liability: Members enjoy limited liability, protecting their assets from business debts and legal liabilities.
• Pro-Business: Utah is known for its pro-business environment with low taxes, minimal regulations, and strong support for entrepreneurship.
• Tax Benefits: Utah offers LLC tax advantages, including no franchise or capital stock tax. Additionally, LLCs in Utah can choose their federal tax classification.
