How to Form an LLC in Idaho in 7 Steps
Setting up a limited liability company (LLC) in Idaho requires several steps including choosing a name for your LLC, appointing a registered agent, filing a certificate of organization, applying for an EIN and registering for tax and business accounts.
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Choosing the proper business structure for your business is one of the most significant decisions you’ll make as an owner. If you’re interested in setting up a limited liability company (LLC), it’s essential to understand the necessary steps for beginning the process. This article explains the process for forming an LLC in Idaho and provides links to LLC forms and additional helpful information.
7 Steps to Form an LLC in Idaho
Name Your LLC
Choosing a business name is an essential first step for several reasons. From a marketing and branding standpoint, you need a name that will attract potential customers to your business. From a legal perspective, you need a name that meets state law requirements.
Your Idaho LLC name must be unique and distinguishable from every other business name registered with the state under Idaho Code §30-21-301. To determine if the name you want is available, conduct a business name search through the Idaho Secretary of State website.
Also, note that your LLC name must meet several other requirements under Idaho Code §30-21-301. For example, the name that you choose cannot contain any words or phrases that:
- Imply that your business is affiliated with or is a governmental agency
- Are restricted (such as “bank” and “university”)
- Imply that your business is organized for any unlawful purpose
Make sure that the name you choose includes an indicator of the type of business entity you have. Include either “limited liability company” or “limited company”. You can also use one of the following abbreviations:
- LLC
- L.L.C.
- L.C.
If you have a name in mind but aren’t quite ready to form your LLC, you can apply for a reservation of legal entity name to reserve your desired name. Under Idaho Code §30-21-303, the name reservation period is 120 days. The fee to file is $20 (plus an additional $20 if manually processing).
Get a Registered Agent
Under Idaho Code §30-21-404, Idaho LLCs are required to have an Idaho registered agent at a physical street address as P.O. Boxes are not acceptable. A registered agent is designated to receive service of process, notices, and other legal documents. A registered agent may be an individual who is a resident of Idaho, a business entity registered with the Secretary of State’s office, or you can act as your own registered agent.
File Your Certificate of Organization
In Idaho, filing a certificate of organization with the Secretary of State forms your LLC in the state. You can file online, by mail, or in person. Under Idaho Code §30-25-201, you must provide the following information:
- Name and address of LLC
- Name and address of registered agent
- Mailing address for future correspondence
There’s a filing fee of $100 for online filing and $120 for filing by mail or in-person. Failure to provide the state fee with your filing could lead to the deletion of your filing from the system. It will likely take seven to ten business days to process your certificate of organization and officially register your LLC.
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Draft an Operating Agreement
Although an LLC operating agreement is not required and you do not have to file it with the Idaho Secretary of State, it can be a vital internal document. Your Idaho LLC operating agreement should contain information relating to ownership of the organization and procedures for operation. It’s a document you’ll likely need to look back at to ensure that your business operates under agreed-upon procedures.
Get an EIN
Apply with the Internal Revenue Service (IRS) for an Employer Identification Number (EIN) if you plan on having employees and in certain other situations. You’ll likely need an EIN to open a business bank account. You can think of it as a Social Security number for your business. The IRS assigns these numbers to business entities for federal tax purposes. It’s free to apply for an EIN through the IRS website.
Set Up Business and Tax Accounts
Idaho requires businesses to register for certain permits and licenses. These can include sales/use permits, income tax withholding, Boise Auditorium District permits, and travel or convention permits. You can complete the Idaho business registration application online through the Idaho Department of Labor’s website or use Form IBR-1 business registration to apply by mail or in person. You must register before you can request your business permits. You should also set up an account with the Secretary of State’s Idaho SOSbiz Login to make maintaining your business filings more convenient.
Also, setting up a separate bank account for your business can make accounting and tax preparation more manageable and help keep your personal and business assets separate to maintain protection for your personal assets. You may want to consider getting a business credit card as well.
Check for Additional Federal or State Requirements
Check state and federal websites to determine if there are any specific rules for your business. For example, some LLCs may have to file a Beneficial Ownership Information Report (BOIR) with FinCEN. Under current law, LLCs created in the United States are “domestic reporting companies” and are exempt from the BOIR requirement.
However, laws may change, so stay up to date with state and federal requirements.
Business and Tax Requirements in Idaho
Depending on the kind of business your LLC conducts and where it is located, it will likely be subject to various state taxes and local business licenses or permits.
State Business Tax
You must file state income tax returns for your LLC if it:
- Is transacting business in Idaho
- Is registered with the Idaho Secretary of State to do business in Idaho
- Has income attributable to Idaho
- Is a fiduciary
State Employer Tax
Your LLC must have an Idaho withholding account if it has employees earning income while in Idaho. You must also have a withholding account if you choose to voluntarily withhold Idaho income tax for an Idaho resident working outside of the state of Idaho.
Sales and Use Taxes
If your LLC sells goods in Idaho, you need to collect sales tax, file a sales and use tax return, and send the taxes to the Tax Commission. For state tax purposes, a sale means transferring ownership of tangible personal property or providing taxable services for a profit. If your LLC uses or stores goods in Idaho that you haven’t paid Idaho sales tax on, it is also subject to the state use tax unless an exemption applies.
Business Licenses and Permits
Your LLC may require additional licenses or permits. You can use Idaho’s State and Federal Resources for Businesses website to find more information. The wizard tool allows you to enter information about your business to receive a list of agencies to contact about permits and licenses. You should also reach out to the city or county government where your LLC is located to confirm their licensing or permit requirements.
Registration in Other States
To register your Idaho business in other states, you will likely apply as a foreign LLC in that state. You’ll pay a fee and probably be asked to submit proof of your LLC’s good standing in Idaho.
Annual Requirements in Idaho
Every LLC doing business in Idaho must file an annual report with the Idaho Secretary of State. You can file your annual report by creating a user account with the Idaho Secretary of State’s SOSbiz online filing system. Filing your annual report by paper form can only be completed in the Secretary of State’s office. There is no fee for filing annual reports, but they must be filed by the end of your LLC’s anniversary month.
Idaho LLC Formation FAQs
The cost of having an LLC in Idaho depends on the type of LLC, the kind of business you do, where your business is located, and the various fees, taxes, and other costs you’ll be responsible for. A list of common LLC forms and fees in Idaho can be found on the Secretary of State website.
The fee for filing your certificate of organization to form an LLC in Idaho is $100 if you apply online. There is an additional $20 fee for manually processing a paper filing.
You do not have to pay a fee for filing your LLC’s annual report. However, Idaho’s Secretary of State now encourages business owners to create a user account with their new SOSbiz filing system and file annual reports online. If your LLC was required to obtain licenses or permits, you will need to pay applicable renewal fees and pay taxes.
Single-member LLC: A single-member LLC has one owner who controls the business. This makes sense to use if you want to be the sole manager of your LLC. A single-member LLC is treated like an individual for income taxes and your company’s profits and losses are included on your personal tax return where you can deduct pass-through expenses.
Multi-member LLC: A multi-member LLC has two or more owners or members who share control of the business. Similar to a partnership, members report profits and losses on their personal income tax returns. Members of the LLC can choose to make the business member-managed where they oversee the business operations themselves or manager-managed by hiring outside managers to run the LLC.
Professional LLC: A Professional LLC can be formed in Idaho if your LLC will provide a professional service and protect the personal liability of the members. Complete the certificate of organization for a professional LLC and include a statement that the company is a professional limited liability company and the principal profession or professions for which the company’s members are duly licensed or otherwise legally authorized to render professional service. The professions that can form a PLLC in Idaho are architecture, certified or licensed public accountancy, chiropractic, dentistry, engineering, landscape architecture, medicine, nursing, occupational therapy, physical therapy, podiatry, professional geology, psychology, social work, surveying, and veterinary medicine.
You are required to file a certificate of organization to form an LLC in Idaho. This is your LLC’s charter document and verifies your business was properly formed in the state and authorized by the Secretary of State to conduct business. You may need this certificate to open a bank account for your LLC or obtain financing from lenders. You can get a copy by accessing your initial filing with the Secretary of State. You can also request a certified copy.
A certificate of good standing confirms your LLC’s valid formation and compliance with state laws and regulations. You can request or purchase a certificate of good standing/existence for your Idaho LLC by going to the Secretary of State’s online service and selecting the option to purchase a certificate of good standing/existence from the “Business Services” dropdown menu. You’ll search your LLC’s name and click on it to request your certificate. The fee is $10. A certificate of good standing/existence might be required to register your LLC in a different state or jurisdiction, open business bank accounts, or apply for business loans.
The things you must do to form an LLC in Idaho are:
- Choose a legally valid name and make sure it’s available for use
- Select a registered agent
- File a certificate of organization with the Idaho Secretary of State
- Draft an operating agreement (although not required under Idaho law)
There are many benefits to forming an Idaho LLC for your small business or larger enterprise. You might want to start an LLC to benefit from limited liability protection. Having limited liability means that your personal assets, such as houses and cars, are protected in the event of a lawsuit against your company. If you’re already operating a business as a sole proprietor, you don’t have this protection for your personal assets and should consider forming an LLC to protect your personal liability.
Another benefit of LLCs is this business structure’s flexibility. You can choose how you’d like the entity to be taxed, and you don’t have to stick to the rigid organizational structure of a corporation. Many business owners find LLCs to be a great mix of the features of sole proprietorships and corporations.
To maintain your LLC, you must file annual reports. The Secretary of State encourages businesses to use their online SOSbiz system for filing. If you want to file by paper, you have to use one of their new forms that include a barcode. You can request a blank form for your annual report in person at the Secretary of State’s office or by:
- Email at business@sos.idaho.gov
- Phone at (208) 334-2301
- Downloading from the website
No. An Idaho certificate of organization is a required filing to form an LLC in Idaho. This is the document you must file with the Secretary of State to start your LLC in the state. An operating agreement is an optional agreement between members of the LLC that lays out member interests and internal rules and policies. It does not have to be submitted to the Secretary of State.
Yes. If you’re doing business as (DBA) a name different from the one you used to register your LLC in Idaho, you can apply for an assumed business name. Submit an application for a certificate of assumed business name with the Idaho Secretary of State to transact business under a different name. The filing fee is $25 (an additional manual filing fee of $20 is charged if you file by mail or in person). Remember that registering an assumed business name does not create a new business entity.
You might need to register for certain business license and permits. You can check with the Idaho State Tax Commission for tax-related information about forming your business. Idaho also requires businesses to register for certain permits depending on the type of business your LLC conducts. Idaho’s State and Federal Resources for Businesses website has a Business Wizard you can use to find out if your LLC may require additional licenses, permits, or taxes. You will also receive a list of state agencies to contact with the reason to contact them.
If your business sells a product, has employees, or is engaged in the lodging industry, you will need to complete the Idaho Department of Labor’s form IBR-1 to register your business for a sales and use tax permit and establish accounts for state withholding, unemployment insurance, and tax accounts. You can visit Idaho’s Division of Occupational and Professional Licenses website if you need to learn more about applying for a state occupational or professional license. You should also contact the local county or city clerk’s office where your LLC is located or does business to confirm whether you need to apply for local permits or licenses.
Yes. The Secretary of State encourages new businesses to use their SOSbiz tool to register new LLCs by filing a certificate of organization online. The online filing fee is $100. You can also choose to use an Idaho LLC formation service to create an LLC in Idaho.
The mailing address for the Idaho Secretary of State is:
Office of the Secretary of State
450 N 4th Street
P.O. Box 83720
Boise, ID 83720-0080
Business hours are Monday through Friday from 8 a.m. to 5 p.m.
Yes. A registered agent acts as a point of contact for your LLC. Using a registered agent service can be beneficial because it allows you to retain your privacy, ensure compliance by receiving service of process, and receive important mail during regular business hours.
A domestic LLC in Idaho means an LLC that was originally formed in Idaho making that the LLC’s “home state."
To register your LLC in another state, check with the government agency that oversees business formation in that jurisdiction. Many states require LLCs originally formed in another state to register as a foreign LLC. You will pay the filing fee and also likely have to provide proof of your LLC’s certificate of good standing/existence from its home state of Idaho.
To register a foreign LLC in Idaho, you can apply online by submitting the foreign registration statement through SOSbiz. You will be required to create an account and pay the $100 filing fee. You can also file by submitting the paper form to the Idaho Secretary of State’s office. There is an additional $20 fee to file by paper. Your application must be accompanied by a certificate of existence or certificate of good standing from your LLC’s home state dated within 90 days from the date of filing your foreign registration in Idaho.
In Idaho, LLCs are dissolved by submitting a statement of dissolution to the Secretary of State. You need to provide the name of your LLC exactly as it was originally filed on the certificate of organization and make sure it’s signed by a member, manager, or authorized person. If done online, there is no filing fee. If completing and mailing a form, the filing fee is $20.
Business formation documents are public records. Any information included on the registration form will be available to the public, including your home address if your business is home-based. Anonymous LLCs do not disclose the personal information of the LLC’s owners on the articles of organization. The only states that permit anonymous LLC formation are Delaware, Nevada, New Mexico, and Wyoming. Entrepreneurs who want to protect their privacy often choose to use a professional service for their LLC’s registered agent.
Disclaimer: The information presented here does not constitute legal advice or representation. It is general and educational in nature, may not reflect all recent legal developments, and may not apply to your unique facts and circumstances. Consider consulting with a qualified business attorney if you have legal questions.
How to Start an LLC in Other U.S. States
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