Forming an LLC

Here are the general steps you need to follow in order to form an LLC in compliance with applicable laws. Make sure to consult your state page for state-specific details.

1. Choose a business name for the LLC and check for availability.

  • As a general matter the name must (a) not be the same as that of another LLC on file with the state; (b) contain the words "Limited Liability Company," "Limited Company," or an abbreviation like "LLC"; (c) not contain certain words prohibited by state law, such as "Bank," "Insurance," "Corporation," or "City."
  • Although you are not required to do so, you should consider registering your business name as a federal and/or state trademark. Please see the Trademark for Business Naming section for details.

2. Prepare and file articles of organization with the appropriate state office, usually the Secretary of State.

  • There is a filing fee, which generally ranges between $70 and $200 depending on the state, but certain states have higher fees (e.g., Illinois ($500), Massachusetts ($500), and Texas ($300)). See the state pages on forming an LLC for details on state filing fees.

3. Negotiate and execute an operating agreement.

  • This step generally is not legally required, but it is highly advisable that the members of an LLC execute a formal operating agreement. Please see the Operating Agreement section for details.

4. Obtain any required local licenses.

  • As a business doing journalism, you are not required to obtain any federal or state licenses or permits relating to carrying on a particular trade. Most local or city governments, however, require every business to obtain a basic business license, sometimes called a tax registration certificate. You get this license from your city or county. The best way to get information about fees and procedures is to contact your county or city clerk's office or other local government authority. The local chamber of commerce and other small business owners might also be a good resource for information regarding local licenses and/or permits.

5. Determine what tax obligations the LLC has, and take care of any necessary registrations.

  • If you have any employees or more than one member, or you choose to have your single-member LLC taxed as a corporation, you need to apply for an Employer Identification Number (EIN) from the IRS. There is no filing fee. You can apply for an EIN:
  • by submitting the required information online at the IRS website. The EIN is issued immediately once the application information is validated;
  • by telephone at 1-800-829-4933 from 7:00 a.m. to 10:00 p.m. in your local time zone; or
  • If you have employees, the LLC likely will need to obtain a state employer identification number or account for tax purposes. You will also have to report any new hires as you make them. See the State Law: Forming an LLC section for details on state requirements.
  • You should be aware that, as the owner of a small business, you may be subject to additional federal, state and local taxes and informational filing requirements, such as self-employment taxes and employment withholdings and filings. Please see the Tax Obligations of Small Businesses section for details.

6. Open a bank account for your business.

  • It is a good idea to keep your business's finances separate from your personal accounts. A good way to do this early on is by opening a bank account for your business. You will probably need a Tax ID number (EIN), a copy of the articles of organization, and a resolution identifying authorized signers if those names are not listed in the articles. Here is one example of the documentation that banks ask for.

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