Start an LLC in Idaho

Last updated on: October 6, 2021

If you are planning to apply for an LLC or Professional LLC in Idaho, it is important to have an idea of the right course of action. Fortunately, in comparison to some other states, the process of starting an LLC in Idaho is fairly easy and can even be done by an aspiring businessman. 

In this article, we will take a look at how to open an Idaho LLC quickly and smoothly. You will learn what documents and fees are required, where to get the necessary forms, and where to submit them once completed. In addition, we’ll briefly mention how to keep a business in Idaho in good standing and what the basic requirements are for companies registered in the state.

Select an LLC Name

Are you planning to create an LLC and are in the process of choosing a name? Make sure you pick a name that is not only creative and memorable but also legal. Some of the main criteria that an Idaho business name should meet include:

  • Uniqueness: the name you choose should be different from all Idaho LLCs, including not being deceptively similar to other businesses;
  • The company name has to include words or abbreviations such as:
  • “Limited Liability Company”;
  • “Limited Company”;
  • “LC”;
  • “LLC”;
  • “L.L.C.”
  • “L.C.,” etc.
  • The name of an LLC should not mislead the public as to its nature and purpose. In addition, no words such as “bank,” “insurance,” “trust,” etc. may be used without specific permissions.

Name Availability Check

To make sure that you have chosen a unique LLC name, it is important to check it before submitting documents. You can do a free Business Search available on the official page of the Secretary of State.

If the result of the check shows that the name you want is available, you can proceed with the business startup with confidence. However, if the LLC name is already taken, you need to improve its uniqueness. There are several ways to do this:

  • Changing one or more of the keywords;
  • Changing the order of the keywords;
  • Making a keyword singular, plural, or possessive;
  • Adding, removing, or rearranging one or more letters or numerals;
  • One or more keywords have a “creative, unusual, or artistic” spelling;
  • Expressing numbers differently (as Arabic numerals, Roman numerals, or words).

Name Reservation

You do not plan to start Idaho LLC formation but are afraid that someone else will register your name first? Take advantage of a reservation. For a reasonable fee, the state allows you to keep your desired company name for 4 months, protecting it from third parties.

You can apply for name reservation either online, through the SOSBiz page, or by sending a paper application to:

Office of the Secretary of State
450 N 4th Street, PO Box 83720
Boise ID 83720

Please, note that the cost of processing documents depends on how they are submitted. There is a mandatory fee of $20 for digital forms and $40 for paper forms. 

As for timing, paper documents are usually processed within 7-10 days. However, for $20, you can take advantage of expedited service for either filing option.

Create an Operating Agreement

An Operating Agreement is an internal act of the LLC governing its basic operating procedures and management structure. While an Operating Agreement is not required for doing business in Idaho, it is a good practice. Among the benefits of having this document are the following:

  • Prevention of management conflicts;
  • A clear division of rights and responsibilities between the participants;
  • The possibility of avoiding the application of Idaho default laws, which, due to their general nature, do not take into account the interests of individual enterprises;
  • Fixing the separation of personal assets of participants and the property of the LLC;
  • An opportunity to demonstrate the Operating Agreement to potential partners or investors to confirm the stability and reliability of the company;
  • Acceleration of operating procedures, etc.

Due to the fact that this is not a mandatory internal document, there is no official form for Idaho Operating Agreement LLC. You can get it in two ways:

  1. Hire an attorney: an experienced attorney can review your Operating Agreement or draft it to meet the individual needs of the LLC. However, the services of specialists are quite expensive, so be prepared to pay a few hundred dollars;
  2. Write it yourself: you can create an Operating Agreement using free online templates, or templates offered by online companies. The best options are websites such as Northwest Registered Agent.

Of course, you can register LLC without taking the time to prepare an Operating Agreement. However, in the future, having one can make doing business much easier and protect your company’s status.

Assign an Idaho Registered Agent

Section 30-21-402 requires that each LLC has to designate an agent for service of process, whose purpose is to receive official correspondence addressed to it. This is a mandatory step because the state will deny your application if there is no record of a registered agent.

A business owner may designate either an individual or an entity as a registered agent LLC, as long as the requirements are met, of course.

Individual as an Idaho Registered Agent

No experience or special education is required to become an Idaho LLC Registered Agent. The criteria a candidate has to meet are as follows:

  • Resident of the state;
  • 18 years of age or older;
  • Having a physical address located in the state;
  • Ability to be in the company’s registered office during all working hours to receive official correspondence in person.

Registered Agent Service in Idaho

If you are interested in professional service, consider hiring an online company. Services like LegalZoom will take over your registered agent duties for a reasonable fee, as well as provide access to a wide range of additional offers. It’s a good chance to simplify your business processes and a solid investment in your company’s future.

Open an LLC Bank Account

After you file an LLC, you need to take care of opening a business bank account. Having a business checking account is a guarantee that the assets of the company are securely separated from the personal funds of its owners. This is necessary to protect an LLC in Idaho because otherwise, the court can overturn the limited liability protection, which will result in serious financial costs.

Usually, to open a business account, you need to provide a bank with such documents:

  • A copy of the Idaho LLC Certificate of Organization;
  • The Operating Agreement;
  • The EIN;
  • Bank resolution (for multiple members LLCs).

Obtain an EIN in Idaho

After Idaho LLC registration, you will most likely need to obtain an Employer Identification Number (EIN). This is a unique 9-digit number that the IRS assigns to businesses for quick identification of tax records. It is required for businesses that:

  • Hire employees;
  • Pay federal or state taxes;
  • Are filing special federal documents, such as liquor, tobacco, or firearms tax returns;
  • Are planning to open a commercial bank account, etc.

You can get an EIN online, by mail, or by fax. All these methods are free but will have an impact on the speed of processing.

Online

To apply online and get your EIN immediately, you’ll need a valid Social Security number. Please, note that you can only apply between 7 a.m. and 10 p.m. EST, Monday through Friday. 

Mail

If you’re willing to wait about 4 weeks for your EIN, you can mail your completed Form SS-4 to:

Internal Revenue Service Operation
Attn: EIN Operation
Cincinnati, OH 45999

Fax

If you wish to receive your EIN within 4 business days, you may fax a completed Form Form SS-4 to:

(855) 641-6935

Although an LLC is not required to get an EIN, almost all businesses need one. It allows you to get Idaho LLC in the most efficient way possible and meet the basic requirements for an LLC.

File the ID Certificate of Organization

The first step in the formal Idaho LLC formation process is to file the documents with the Secretary of State. Depending on the circumstances, LLC Formation Documents may be referred to as Certificate of Organization or Articles of Organization, meaning one form.

To fill out the Idaho LLC Certificate of Organization, you will need to provide the following basic information:

  • The name of an LLC;
  • The name and address of the registered agent;
  • The name and address of at least one LLC member or appointed manager;
  • The street and mailing address of LLC’s principal office;
  • The mailing address where you would like to receive annual report notices;
  • Contact information (phone number and email) where you can be reached.

You may file the Certificate of Organization online or use a paper copy. 

Online

If you prefer the convenience and speed of digital documents, registering online is your best option. To apply, you will need to follow the steps such as:

  1. Start by visiting the SOSBiz page and logging into your account or registering a new one;
  2. Select “Forms” on the left side of the page;
  3. Click on “Certificate of Organization Limited Liability Company”;
  4. Enter the required information;
  5. Pay the LLC cost of $100.

By Mail/In Person

If you appreciate the reliability of a paper application or just want to pay the required fee by check or money order, you can send the materials by mail or deliver them in person.

Fill out the online form on the SOSBiz page and print it out. There is a $120 mandatory processing fee for paper documents, which is slightly more expensive than online registration. Send the materials and a check for the state fee to:

Office of the Secretary of State
450 N 4th Street, PO Box 83720
Boise, ID 83720

The approximate estimated time to review the Certificate of Organization is 7 to 10 business days. However, you can get an LLC within 8 business days by ordering expedited service for $20.

Keep Your Idaho LLC Business Compliant

Idaho LLC Annual Report

After opening an LLC in Idaho, owners have to comply with current state requirements to keep the company in good standing. For example, one of the main requirements for LLCs doing business in Idaho is timely reporting. This is important because the state should always have up-to-date information about the company.

Idaho is one of the few states where there is no mandatory fee for processing annual reports. It should be done annually, no later than the end of the month in which your company was officially registered.

According to state requirements, LLCs file an annual report online. To do so, visit the SOSBiz page, then click “File Annual Report,” and follow the instructions for submitting the form.

If you miss the deadline for filing an annual report, there is no late fee. However, the LLC may be subject to administrative termination if the breach is not corrected within 60 days of the deadline.

Business Permits and Licenses in Idaho

Once the Certificate of Organization is approved, your business is considered fully legal. However, more often than not, it is not enough to operate. Most businesses need to obtain business licenses and permits, the number and type of which are determined by their industry and location.

Unlike some other states, a general Idaho business license is not required. However, you will probably have to obtain one or more other licenses. To learn more about this and to determine LLC license costs, check out the Online Services page.

When planning to start a business, keep in mind that cities and counties may have additional licensing requirements for LLCs registered in their territory.

Idaho LLC Taxes

In addition to reporting, business owners should not forget about LLC tax filing, which plays an important role in a confident and successful development. 

Taxes are one of the most significant expense items in the business budget. They can be provided for at all levels of management.

Federal Taxes

All LLCs are treated as “pass-through” tax items by default, which exempts the company from filing its own return. Instead, owners report business profits and expenses on personal 1040 tax returns and/or Schedule C.

However, because of the tax flexibility, business owners can change their tax treatment to corporate taxation.

State Taxes

When it comes to state taxes, Idaho follows the same principles as federal law. LLCs generally do not pay taxes on their own behalf, delegating that responsibility to their owners. Moreover, there are no “franchise” or “privilege” taxes in this state, which creates an attractive environment for company development.

Additional Taxes

Moreover, there are several LLC tax forms, depending on the characteristics of your business. For example, companies with employees should pay Withholding and Unemployment Insurance Taxes. Another common business tax form for an LLC is Sales and Use Taxes, which are mandatory for businesses that sell goods or services.

LLCs should register with the State Tax Commission website to pay taxes.

Bottom Line

An LLC is one of the most reliable yet simple business structures. We believe that you can easily do the job of setting up an LLC in Idaho on your own, but you can save energy and nerves by using the services of online companies. 

Today, there are dozens of LLC formation services that offer LLC help at all stages of a business’s life. In addition, it is a great opportunity to save money getting high-quality professional service. For example, affordable online services like IncFile or ZenBusiness will make LLC startup Idaho not only easy but also profitable. Their startup packages for starting an LLC have attractive prices starting at $0 to $49 and include 1 year of free registered agent service.

Senior Business Tax Writer, etc
Jean Wilson Murray
https://bestllcservices.co/
(323) 789-5289
Senior Business Tax Writer, etc
Jean Wilson Murray

In this IncFile vs ZenBusiness review, we're going to compare two of the most popular LLC formation services based on pricing, features, and drawing out differences and similarities to let you see which is most suitable for you and your business.

You can learn more about @Mike here.

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