Forming a Limited Liability Company (LLC) in Idaho is an easy process, but it involves a few steps. 

Start an Idaho LLC for $0 + state fee 

To form an LLC in Idaho for free + state fee, we have listed 3 options to consider: 

You can go online and visit the Idaho Secretary of State’s website and do it yourself or you can use the ‘free’ service from Incfile or ZenBusiness.

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Forming an LLC in Idaho for $0 (DIY Summary)

Here’s a brief step-by-step guide to help you through the DIY process, along with relevant links to official resources:

Step 1: Choose a Name for Your LLC

Start by selecting a unique name for your Idaho LLC. The name should comply with the state’s naming requirements, such as including the words “Limited Liability Company” or the abbreviation “LLC.”

You can conduct a business name search on the Idaho Secretary of State’s website to ensure your desired name is available.

Step 2: File Articles of Organization

Next, you need to file Articles of Organization with the Idaho Secretary of State.

This document includes information about your LLC, such as its name, address, and registered agent details.

You can complete the filing online or download the form from the Secretary of State’s website and mail it along with the required fee.

Step 3: Appoint a Registered Agent

An LLC in Idaho must have a registered agent who can accept legal documents on behalf of the company.

The registered agent must have a physical address in Idaho.

You can act as your own registered agent or hire a professional registered agent service to fulfill this role.

Step 4: Create an Operating Agreement

Although not required by law, it is advisable to create an operating agreement for your Idaho LLC. This agreement outlines the ownership and operating procedures of the company.

It helps establish clear guidelines for decision-making, profit distribution, and dispute resolution among LLC members.

Step 5: Obtain Required Permits and Licenses

Depending on the nature of your business, you may need to obtain additional permits or licenses at the local, state, or federal level.

Idaho’s official government website provides comprehensive information on the licenses and permits required for different types of businesses.

Ensure you comply with all applicable regulations.

Step 6: File Annual Reports

Every LLC in Idaho must file an Annual Report with the Secretary of State.

This report updates the state of your LLC’s contact information and confirms its continued existence. You can complete the filing online and pay the required fee.

Failure to file the Annual Report may result in penalties or administrative dissolution of your LLC.

Step 7: Comply with Tax Obligations

Make sure you understand and fulfill your LLC’s tax obligations in Idaho.

This includes registering with the Idaho State Tax Commission, obtaining an Employer Identification Number (EIN) from the IRS if you have employees, and filing the necessary state and federal tax returns.

For more information, you can visit the official Idaho government websites:

Idaho LLC: Definitions

  1. LLC: An LLC (Limited Liability Company) is a type of legal business entity that combines the limited liability protection of a corporation with the flexible management and tax benefits of a partnership.
  2. Formation: Formation refers to the process of creating and establishing an LLC as a separate legal entity. It involves filing the necessary documents and fulfilling the requirements set by the state.
  3. Articles of Organization: The Articles of Organization is a legal document that officially establishes the existence of an LLC. It includes essential information about the company, such as its name, registered agent, members, and purpose.
  4. Registered Agent: A registered agent is an individual or business entity designated to receive legal documents, notices, and official correspondence on behalf of the LLC. They must have a physical address in the state of Idaho and be available during regular business hours.
  5. Operating Agreement: An operating agreement is a written contract that outlines the internal operations and management structure of an LLC. It establishes the rights and responsibilities of the members, decision-making processes, and rules for the company’s governance.
  6. EIN: EIN stands for Employer Identification Number, which is a unique nine-digit number assigned by the Internal Revenue Service (IRS) to identify businesses for tax purposes. An EIN is necessary for an LLC to open a bank account, hire employees, and fulfill tax obligations.
  7. Idaho Secretary of State: The Idaho Secretary of State is the government office responsible for maintaining business records, processing LLC formations, and providing information on business regulations and requirements within the state.
  8. Annual Report: An annual report is a yearly filing that an LLC must submit to the Idaho Secretary of State. It provides updated information about the LLC’s members, registered agent, and principal address. Filing the annual report is necessary to maintain the LLC’s active status.
  9. Certificate of Good Standing: A certificate of good standing is a document issued by the Idaho Secretary of State that confirms an LLC’s compliance with state regulations. It verifies that the LLC is current on its filings and is in good standing with the state.
  10. Dissolution: Dissolution refers to the legal process of terminating the existence of an LLC. It involves filing dissolution documents with the Idaho Secretary of State, settling the company’s obligations, and distributing its assets to the members.

These terms provide a basic understanding of the key concepts and processes involved in forming an LLC in Idaho.

Extended Version

Are you thinking about opening an LLC in Idaho? It’s likely that you are eager to start your own business and interact with clients or customers.

Before opening up shop and interacting with customers or clients, you will need to file paperwork for an Idaho LLC.

You must ensure that all legal requirements are met if you want to reap the benefits of an LLC such as the separation of personal assets and business assets.

This guide on starting an LLC in Idaho provides step-by-step instructions on how to file documentation, obtain tax IDs, and set up company records.

This page will provide you with all the necessary steps to do a Idaho entity name search, draft a Idaho LLC operating agreement, and answer questions like, how long does it take to get a Idaho LLC? and ensure your Idaho LLC is properly formed.

Idaho Business Resources

Overview

LLCs are the most commonly used business structure. This is because they are relatively inexpensive to set up and allow owners to be flexible. Your LLC legally creates your business, limits personal liability, gives you tax flexibility, and establishes your personal liability.

As you move through the entire process, you will be guided by the following steps.

If you want to use an LLC formation service, visit our list of the best LLC services in Idaho.

Step by Step Idaho LLC Instructions

  1. Check Name Availability

    Your LLC’s legal address may not be used in conjunction with any other registered title. A name search can help you find out if your name is available.

    Name Search

    Idaho Secretary Of State

    Search

    Name ReservationOptional
    Suffix:

    The limited liability company name must include the phrase “limited responsibility company” (or “limited company”) or the abbreviation L.L.C.,” L.L.C.,” L.C.,” L.C.,” L.C.,” L.C.,” L.C.,” L.C.,” and “LC.” The abbreviations for “Limited”, or “Ltd.,” may be used. “Company” may also be abbreviated by “Co.”

    Idaho Statutes. SS 30-21-302

  2. Designate a Registered Agent

    Before you can officially file to set up your Idaho LLC LLC, you’ll need to identify your Idaho registered agent. A registered agent allows a business to receive notices from the government and legal counsel.

    The state law requires that every LLC has a registered representative. When you file Idaho articles to the organization with the Idaho Secretary Of State, the registered agent will be designated.

  3. Idaho Certificates of Formation

    Fill out the articles of incorporation to establish your limited liability company.

    Agency:Idaho Secretary Of State
    Form:
    Certificate of Organization Limited Liability Company
    Filing MethodOnline and Mail
    Agency Fee$100 + optional $20 expedite cost
    Turnaround:~1 week. 1 week.
    Law:
    Idaho Statues: Title 30. Corporations. Chapter 6. Idaho Uniform Limited Liability Company Act
    Notes:Two copies must be submitted
  4. Establish Company Records

    Your LLC must keep complete and accurate books and records. Your LLC’s original articles of organization will be the first document you keep. Your LLC will produce other official records like:

    • Minutes from meetings
    • Operating agreement
    • EIN verification letter
    • Amendments and other filings of the LLC throughout its lifespan
  5. You must create the Operating Agreement

    It is possible to use a template to draft an Operating Agreement. It is the governing documents for the LLC. It specifies the legalities of the LLC’s operation, such the annual meeting and the procedure for submitting it to creditors. At your organizational meeting you will review and approve the agreement.

The benefits of an operating agreement

Although operating agreements aren’t required for Idaho LLCs, they are strongly recommended. These are the benefits:

  • Personal assets protection: You can add an additional layer of legal protection to protect you and your personal assets from what happens to your business.
  • Clearly defined rules: In the absence of an operating contract, the state of Idaho has established default rules for LLC operations. An operating agreement is a way to prevent defaults and clarify how your company should operate.
  • Assign ownership: An agreement can clearly state what percentage each member holds. This will include how much capital each member contributed, and how expenses and profits should be divided. This will prevent any disputes with your partners later.
  • Succession or dissolution: The agreement may specify who will get what share of the business in case something happens. You can also specify how the business will be divided if it dissolves.
  • Business financing: Banks may ask for an operating agreement in order to verify that you have given your business serious consideration.
  • The Operating Agreement will help you get in the right frame of mind to start your business. You can plan for different scenarios by using an operating agreement.
  1. Hold the Organizational Meeting

    The organizational meeting, which is the initial meeting of LLC members, is the most important. In order to hold this meeting, you’ll need your operating agreements and the filed articles. Keep minutes from this meeting and place them in your company record books.

  2. Get a federal employer identification number (EIN)

    EIN is needed if the LLC will have multiple members or hire employees. EINs can also be required to open a bank or other financial account.

    Agency:Internal Revenue Service
    Form:
    IRS form SS-4
    Filing MethodMail, phone and fax. online.
    IRS fee$0
    Turnaround:Online immediately, or by phone. By fax, it takes 4 business working days. 4-5 Weeks by mail
    Notes:The IRS website cannot be accessed outside of certain hours. Print your EIN before you close the session. IRS Pub1635: Understanding Your EIN provides additional guidance.
  3. Idaho State Tax Identification Numbers/Accounts

    An Idaho seller’s certificate is required for LLCs that make retail sales. Idaho withholding accounts will be required if employees are involved. Register for Idaho tax account by filing online. This will allow you to register your LLC with both the Idaho Department of Labor (Idaho State Tax Commission) and the Idaho Industrial Commission.

    Submit to

    Idaho State Tax Commission

    http://tax.idaho.gov/

    Filing Method

    Online Idaho Business registration System and Permit/Account Applications
    Fee:
    $0
  4. Consider Electing C-Corp and C-Corptaxation

    Your LLC will be subject to passthrough taxation by default. However, most LLCs continue to keep this tax type. Some LLCs are eligible to elect S-Corp, C-Corp tax treatment.

    • S-Corp can help owner-employees making more than $75,000 a year save on self-employment income taxes.
    • C-Corps face double taxation. First, the corporation pays income taxes and then members pay distribution taxes. C-Corps offer low tax rates on retained earnings, which can be beneficial if you have more than $250,000 in profits per owner.
  5. How to get a Business License & Permit

    It is necessary to obtain the required licenses and permits in order for your business to be legally operated. You can easily navigate the large number of state, federal, and local requirements by searching for your business type using the Small Business Administration Business License & Permit lookup tool.

    Idaho Business License

    NOT REQUIRED

    Idaho does NOT require licensure as a general business license.

    Idaho does have a state-level general business license. However, Idaho often requires local licenses.

  6. To Maintain Your LLC, You Need to File Ongoing Filings

    You must file your federal and state taxes returns.

    For good standing with the secretary, many states also require business entities that file an annual statement. You can see the table below for information on Idaho LLCs that must file an annual return.

    Idaho Corporation Annual Requirements for Reports:

    Agency:Idaho Secretary Of State
    Form:The Secretary Of State’s office will send you a request for a mail-in report.
    Filing MethodMail or .
    Agency Fee$0
    Due:Each year by the last day anniversary month of your registration. Therefore, if you were foreign-qualified (incorporated) on March 15, your annual reports must be filed by March 31.
    Law:
    Idaho Statutes. SS30-21-213.
    Penalties:No late fee. Within 60 days, the secretary will either dissolve or revoke you business.
    Notes:
    • Anyone with authority may apply.

Idaho LLC FAQs

How much does it cost to start an LLC in Idaho?Based on your filing method and whether you reserve your business name, the state fees to form an Idaho LLC range from $100 up to $140.

The cost of filing an extension will increase. You should note that filing fees can change at any time. For the most current filing fee schedule, visit the Idaho Secretary of State website.

What are the benefits of an LLC in Idaho?

It makes sense to consider the benefits of setting up an LLC in Idaho and then to look at the reasons Idaho is such a great place for starting a business.An LLC gives you the protection of a corporation while also offering the tax benefits of sole proprietorship or partnership.

An LLC is legal in Idaho

  • It operates under an operating agreement that has been created by its members, or is governed and governed by Idaho Uniform Limited Liability Company Act.
  • The company acts in their best interest. In most cases, they are not personally responsible for any debts, obligations or liabilities incurred by the company.
  • If there are multiple owners, the tax is either a sole proprietorship or partnership.
  • This is a simple business structure that allows for easy filing, management, compliance, regulation, and administration.

An LLC formed in Idaho has many benefits over other states. These are some of the benefits:

  • Idaho is ranked No. Idaho ranks No. 1 in job growth and No. 3 for business friendliness. 3 for business friendliness.
  • Idaho is a high-performing state with low costs of doing business.
  • Idaho has one the lowest living costs in the country.
  • Idaho has 12 metropolitan areas and nearly 2 million residents. It is also home to many key industries such as advanced manufacturing, aerospace and food production.
  • There are many incentives available, including tax reimbursements, grants, financing and workforce development.

How is an LLC taxed in Idaho?

Your Idaho LLC might need to pay a variety of taxes. These taxes include sales tax and other taxes that must be paid to the Idaho government. The IRS may also require you to pay self-employment and federal tax.

Your LLC can be taxed as a partnership, but you will not have to pay business income tax or personal income tax. This means that LLCs are considered pass-through entities.

The income from the business “passes through” to your personal income, and not at the business level. All income from your LLC will be treated like personal income if you are a single owner LLC.

If there are other members to the LLC, you must file forms detailing each member’s share. They will then be taxed on that portion of their personal tax return. Additional taxes could apply if you have employees, operate or sell certain products, or if there are any other tax requirements.

The following taxes could be your responsibility in Idaho:

  • Amusement devices
  • Beer tax
  • Tax on business income
  • Cigarette tax
  • E911 prepaid wireless fee
  • Electricity tax
  • Estate tax
  • Fuel tax
  • Income tax
  • Tax on mine licenses
  • Tax on oil and gas production
  • Property tax
  • Sales and Use Tax
  • Tobacco tax
  • Convention and travel tax
  • Tax on vending machines
  • Taxes on wine
  • Employer withholding tax

Visit Idaho’s Tax Types Page to learn more about each tax and which tax applies to you. The Idaho Business Wizard page is another great resource to help you determine what forms, taxes, licenses, or other items are required to comply with the law. The site will tell you what to file next by answering a series questions.

  • What is the processing time to form my Idaho LLC? According to the Idaho Secretary of State’s website, most filings are processed within seven to ten days. You will need to factor in the extra time required for forms to reach their destination if you file via mail. For an additional fee, expedited processing is possible. Same-day processing is also available.
  • Do I need to file my operating agreement with the state of Idaho? Idaho doesn’t require LLCs to file operating agreements with the state. These documents are not required for registration with the government but are important internal guidelines.
  • Idaho might not ask for it but you should still make an operating agreement for the LLC. It is highly recommended that you create an operating agreement for your new LLC to protect yourself and ensure your company’s success.
  • Even if your LLC is solely launched, operating agreements can be very beneficial to both single members and those with multiple LLC members.
  • An operating agreement, as we discussed, outlines your company’s management structures and practices. It also identifies the rights, powers, and responsibilities of each individual. The operating agreement usually includes clear instructions about how to proceed in the event of certain outcomes, such as members joining or leaving an LLC.
  • What tax structure should I choose for my Idaho LLC? You will be informed about the tax classification options available when you apply for an EIN. The default tax status is the most common for LLCs. This means that the owners of the business pay federal and state taxes on the income they earn. The LLC is treated as an entity and is not subject to separate taxation. Sometimes, larger LLCs opt to file taxes under the corporate umbrella. An accountant can help you determine the best tax classification for your LLC.
  • Does Idaho allow a Series LLC? A Series LLC may have more than one group of members, managers, or LLC interests. Each series has its own rights, powers and duties. Each series could also have its own business purpose. They are not allowed in Idaho.
  • To ensure that you do not face any legal consequences, it is a good idea to consult a lawyer before you attempt to register an LLC with another Series LLC.
  • Which licenses and insurance are required for an LLC in Idaho? Idaho does not require general business licenses, but many types of businesses may need to obtain licenses or permits. It is important to search for licensing that is applicable to your industry, whether it be federal or local.
  • Visit the Idaho Department of Insurance website for more information about what type of insurance you may need.
  • What annual filings are required for my Idaho LLC? All LLCs in Idaho must file an annual report. The Idaho annual reports are free and can be filed online. There are two ways we can assist you in filing your annual report.
  • What is the process for creating a foreign LLC in Idaho?
  • How do I dissolve an Idaho LLC? The members of an LLC must vote to dissolve it before the process can begin.

 

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author avatar
Brian Wilson Writer and Editor
Brian Wilson is the content manager and founder of LLC Radar. Brian grew up in North Texas, just outside of Dallas, and has a bachelor's degree in business from Southern Methodist University. Since graduating from SMU, Brian has gained over 10 years of experience in business writing for several online publications. Brian resides in Plano, Texas and he can be reached by email:   info@llcradar.com Phone: 972-776-4050
  Information provided on this website is for general information and educational purposes only. It is not intended to offer legal advice specific to your business needs. If you need legal advice, you should consult with an attorney. Rankings and reviews are the personal opinions of the authors and/or editors. For questions, while starting a business, we recommend consulting with an attorney or accountant.