How to Form an Indiana LLC

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Indiana LLC Quick Facts

Indiana LLC Costs

Initial LLC Filing Fee

 

  • By Mail – $100
  • Online – $95

 

Recurring Fee (every other year)

 

  • By Mail – $50
  • Online – $32

 

LLC Processing Time

It normally takes 5-7 days by mail and 1 day for online filing in Indiana.

 

Expedited processing is also available for an additional fee.

Don’t want to form an LLC by yourself?

Let IncFile or IncAuthority guide you through the LLC formation process, so you know everything was done right. Only pay state fees!

Quick Reference

The Limited Liability Company (LLC) is a popular entity structure for many businesses starting in Indiana.  The LLC provides personal liability protection and has the potential to save money on taxes. With a little research, you can learn how to form an LLC in Indiana yourself and save some money by not using an attorney.

Unlike a sole proprietorship or partnership where the small business owner can be held personally liable for lawsuits against the business, the LLC is a separate legal structure, protecting the business owner’s personal assets.

Related: How Does an LLC Protect You?

Besides the liability protection, the Limited Liability Company provides several other benefits over the sole proprietorship, partnership, and corporation because of the multiple tax options, ease of administration, and management flexibility.

The LLC state filing fee for online processing is $95 and $100 when filing by mail. Approval for the LLC typically takes 24 hours when filing online and around one week when filing by mail.

Guide to Forming an LLC in Indiana

The steps for filing online or by mail are largely the same.  The screenshots show filing online.

Forming an LLC can be both affordable and is something most people can do themselves. Entity formation companies like IncFile or IncAuthority help guide you through the process and make sure there are no mistakes.

Related: Should you use a Formation Service, Hire an Attorney or Do it Yourself?

To get started, register with Indiana INBiz. Alternatively, you can download the Articles of Organization (Form 49459).

Starting at INBiz, select “Start a New Business” and sign up for a new account.

After registering,

  1. Select “Start a New Business” in the top menu
  2. Click on the “Next” button in the lower right.
  3. You can choose “Business Wizard” or “Frequent User.”  For this step-by-step guide, we chose “Frequent User.”
  4. Next, you will select your business entity—Select Limited Liability Company in the Domestic Entity Type column.

Select Entity Type LLC

Step 1: Register a Business Name

You are asked whether a name has been reserved for the LLC.  This isn’t a requirement to be done ahead of time and if it hasn’t been reserved, select “No.”

Indiana LLC Name Reservation

Next, you will search for available LLC names.  The LLC’s name has to differ from other entity names registered with the Indiana Secretary of State.  Here, you can check on Indiana LLC name availability before filing.

Indiana LLC Name Search

The name of the LLC must include one of the following designators (words or abbreviations) at the end of the business name:

  • Limited Liability Company
  • L.L.C.
  • LLC

A comma may be used after the business name and before the designator.  “Cowboy Cleaners LLC” and “Cowboy Cleaners, LLC” are both acceptable.

Before finalizing a name, learn more about LLC Name Requirements in Indiana. You may also want to see if a domain name is also available to have a matching website address.

If there is a name you want to use, but are not ready to form the LLC, a Name Reservation application can be filed with the Secretary of State. This application will hold a name for up to 120 days and will cost $20.

Enter a business name with the designator to check if the name is available. If the name search comes back as available, click Next.

Step 2: Business Information

Enter an email for the Secretary of State to communicate information regarding the LLC.

Step 3: – Period of Duration

This question on the LLC’s duration is to choose a date in the future when the LLC will close. Most businesses don’t have a set date in mind when they expect to shut down and would choose “Perpetual.”  If you do have a specific end date (typically used for investment-related businesses), choose the date the business will close.

Indiana LLC Period of Duration

Step 4: Effective Date

The next area asks about the effective date of the LLC.  By default, the LLC is effective on the date submitted.  If you prefer to have, the LLC officially start at a later date (up to 90 days), enter that date and time in these fields.

Indiana LLC Effective Date

Step 5: Principal Office Address

In this section, enter the street address, city, state, and zip code of the initial principal office.  This address can be the LLC’s physical address or the address where the business records are stored.  The Principal Office Address does not have to be in Indiana.

Indiana LLC Principal Office

Step 6: Registered Agent

To have an LLC in Indiana, a Registered Agent must be identified for service of process.  The Registered Agent can either be a resident of Indiana (select “Individual” and create a new agent) or a registered agent service (select “Business,” enter their name and search).  The agent must have a physical address in the state to act as a point of contact to receive legal documents, tax notices, summons, subpoenas, etc. on behalf of the LLC.

You are not required to pay for a registered agent. Any individual meeting the requirements can be the agent; however, the agent’s name and address become public record, and with that comes a loss of privacy. This is more important for some entrepreneurs, especially when doing business from home or still employed.  Hiring a company like Northwest Registered Agent to be the Registered Agent will reduce unwanted phone calls and mailings.

Indiana LLC Registered Agent

Step 7: Manager / Member Information

This section asks if the LLC is Member-Managed or Manager-Managed.

  • Member-Managed LLCs have members (owners) that are active in the day-to-day operations of the business.
  • Manager-Managed LLCs have managers hired by the members to run the LLC, similar to a CEO of a corporation.

Most LLCs are not managed by managers.

The next question is optional and asks if the LLC is a Single-Member LLC.  A Single-Member LLC is simply one that is owned by one person.

Indiana LLC Manager Member-Managed LLC

Step 8: Principal Information

Enter the title, name, and address of the principal’s of the LLC.  A principal is an officer, director, board member, partner, etc. in the business.  This is an optional section.

Indiana LLC Principal Information

Step 9: Attachments

Attachments are additional rules or requirements for the LLC.  This is optional, and many LLCs down add additional articles.

Indiana LLC Additional Attachments

Step 10: Review

Review the information to ensure it is correct.

Step 11: Signature

Review the terms, and someone with the authority to sign on behalf of the LLC will sign and provide their title.

Step 12: Pay

Pay and file the Indiana Articles of Organization.

In approximately 24 hours is filing online or around one week if filing by mail, the LLC will be approved.

If mailing the LLC-1 form, send payment to:

Indiana Secretary of State – Business Services Division
302 West Washington Street
Room E-018
Indianapolis, IN 46204

If you have questions, contact the Indiana Secretary of State by phone at 317-234-9768 or by email at https://faqs.in.gov/hc/en-us/requests/new

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Tasks After Forming Your LLC

Once the LLC has been formed, there are a few additional steps to take care of. Below is a list of the most common tasks.

Prepare an Indiana LLC Operating Agreement

The operating agreement is a document that governs the framework of an LLC.  This document covers items like ownership rights, member responsibilities, how profits and losses are distributed, and more.

The state of Indiana does not require an LLC to have an operating agreement, but it is still worth considering. Without an operating agreement:

  • The LLC could be subject to generic state rules that may be detrimental in the event of a lawsuit.
  • Member’s personal liability protection may be diminished.
  • Members may not fully understand their roles and responsibilities, which could lead to costly disputes in the future.

Related: Indiana operating agreement template

Obtain an EIN

The EIN or Employer Identification Number (also called a Federal Employer Identification Number, FEIN, or Federal Tax Identification Number) is a unique 9-digit tax identification number assigned to a business by the Internal Revenue Service (IRS). Similar to a social security number for an individual, the EIN identifies business entities for tax purposes. The EIN will be needed to hire employees, open a bank account, register for business licenses and permits, file federal and state taxes, and more.

There is no cost for the EIN when registering through the IRS. The number is available immediately when applying through the IRS website; however, you can also register by phone, fax, or mailing IRS Form SS-4.

Related: How to Apply for an EIN

Elect the LLC’s Form of Federal Income Taxation

One of the significant benefits of the Limited Liability Company is the tax flexibility it provides.  When applying for the Employer Identification Number, you will choose how the entity will be taxed for federal income tax purposes. While there are some limitations, an LLC may be classified for federal income tax purposes as a:

  • Sole proprietorship
  • Partnership
  • C-corporation
  • S-corporation

While this may sound confusing, this refers to how the LLC is taxed, not the legal structure.

Related: How can an LLC be taxed?

By default, the taxation of an LLC is called pass-through taxation, which means the profits or losses of the LLC flow through to the members.

Single-member LLCs will, by default, be taxed as a sole proprietorship. The members can also elect to change the taxation to a C-corporation or an S-corporation.

Multi-member LLCs will, by default, be taxed as a partnership. The members can also elect to change the taxation to a C-corporation or an S-corporation.

In general, the difference between being taxed as a corporation and being taxed as a sole proprietorship or partnership the profits and losses are passed to the member’s federal income tax returns based on their percentage of ownership.  As a result, the owner will pay self-employment taxes on all business profits.  As an alternative, electing to be taxed as a corporation allows the members to take a reasonable salary and then pay payroll taxes.  Any remaining profits are distributed and aren’t subject to payroll taxes, resulting in potential tax savings.

Before electing how your LLC will be taxed, consider talking with an accountant to assess which one will be best for you.

Open an LLC Bank Account

Opening a bank account for your LLC is important for liability protection as the account separates the business’s funds from the member’s personal funds.

Several documents will be needed to open a business bank account, such as:

  • A banking resolution is a document that authorizes the members to open a business bank account on behalf of the LLC.
  • Copies of the original LLC formation paperwork from the state showing the creation of the LLC.
  • Driver’s licenses of the members.
  • In some circumstances, an Indiana Certificate of Good Standing may be needed to prove the LLC is active and in good standing with the state.

Related: How to Open a Business Bank Account for your LLC 

Apply for Business Licenses and Permits

Depending on what your business does and where it is located, there will likely be various business licenses and permits needed before starting your business. Some common registrations include:

  • Business License – Some cities require businesses to obtain licensing before they can start.
  • Professional License – Certain services such as barbershops, accountants, salons, and others must be licensed.
  • Registered Retail Merchant Certificate – To sell products and certain services, registration to collect sales tax will be necessary with the Indiana Department of Revenue.
  • Unemployment Insurance Registration – If you hire employees, registration through the Department of Workforce Development will be needed.

Related: What Business Licenses are Needed in Indiana?

File the Annual Business Entity Report

LLCs are required to file a biennial report called the Business Entity Report with the Indiana Secretary of State.  This report is due every other year in the anniversary month when the LLC was formed. For example, if the LLC was formed on November 15th, 2020, the next report would be due on November 1st, 2022. The filing fee is $32 for online filing and $50 for mailed-in reports.

Related: How to File an Indiana Business Entity Report