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How to Form an LLC in Iowa
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This guide to starting an LLC in Iowa provides step-by-step instructions on filing formation documents, obtaining tax IDs, and setting up company records.
Overview
LLCs are the most popular business structure because they are inexpensive to form, provide flexibility to the owners, and are easy to run. Forming your LLC legally establishes your business, limits your personal liability, and gains tax flexibility. The following step-by-step will help you as you undertake this process.
Fast Facts: Your Budget and Timeline
Here is an overview of the total paperwork, cost, and time it takes to form an LLC in Iowa. Be sure to read the final step in this guide - "Ongoing Filings" - to understand your ongoing costs to maintain a compliant Iowa LLC.
- Iowa Certificate of Organization
- Operating Agreement
- IRS Form SS-4: Obtain an EIN
- Form 78-005a: Iowa Business Tax Registration
- FinCEN Beneficial Ownership Report
- Formation: $50
- Iowa business tax registration: The state fee varies based on the tax accounts / licenses required.
- Formation: ~1-2 business days
Step-by-Step Iowa LLC Instructions
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Check Name Availability
The legal name of your LLC may not conflict with any other registered name. Check availability of your desired name by conducting a name search.
Name Search: Iowa Secretary of State
Name searchName Reservation: Optional Suffix: The name of a limited liability company must contain the words “limited liability company” or “limited company” or the abbreviation “L.L.C.”, “LLC”, “L.C.”, or “LC”. “Limited” may be abbreviated as “Ltd.”, and “company” may be abbreviated as “Co.”.
Iowa Code §489.108 -
Appoint a Registered Agent
Before you officially file to create your Iowa LLC, you will need to decide who your Iowa registered agent will be. A registered agent is a business's legal appointee to receive notice of lawsuit and other legal or government notices.
State law requires every LLC to have a registered agent. The registered agent is designated when you file Iowa articles of organization with the Iowa Secretary of State.
Our reliable registered agent service fulfills this requirement. You get:
- Same-day documents from our local office in Waterloo
- Immediate online access to state forms with our address and, where required, our signature
- Annual fees from $89 to $99 per state with no additional charges
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File Iowa Certificate of Formation
Iowa calls the articles of organization the certificate of organization. File the certificate of organization to create your limited liability company.
Agency: Iowa Secretary of State Form: Filing Method: Mail, fax, or online
Agency Fee: $50
Turnaround: ~1-2 business days
Law: Iowa Code - Chapter 489: Revised Uniform Limited Liability Company Act
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Establish Company Records
Your LLC must keep correct and complete books and records. Your filed articles of organization are the first documents for your LLC’s records. Your LLC will generate many other official records such as:
- Meeting minutes
- Operating agreement
- EIN verification letter
- Amendments and other filings made to the LLC throughout its lifetime
Organizations need a secure, centralized tool for managing and accessing sensitive records. Our Records Manager software offers a simple, efficient way for LLCs to store records, track members and managers, and customize meeting notifications.
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Create the Operating Agreement
Draft an Operating Agreement (potentially using a template) which is the governing document for the LLC. It defines the formalities of how the LLC will run itself such as holding an annual meeting. You will review and adopt the agreement at your organizational meeting.
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Hold the Organizational Meeting
The first meeting of the members of the LLC is the organizational meeting. You will need your filed articles of organization and your operating agreement in order to conduct this meeting. Keep minutes of this meeting and store them in your company record book.
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Get a Federal Employer Identification Number (EIN)
If your LLC has more than one member or will hire employees, it must obtain an EIN. An EIN is also often required to open a bank account.
Agency: Internal Revenue Service (IRS) Form: Instructions: Applying for an EIN without a SSN/TIN:
- Online applications are not accepted if an individual does not have a SSN/TIN.
- Form SS-4 must be completed, signed, and faxed to the IRS, leaving the SSN/TIN field blank or adding the terminology "foreign" to that line item.
- To follow up on the application, call the IRS and ensure they received the application.
- Depending on the agent you speak with, you may be able to obtain the EIN over the phone. The IRS may then fax the EIN documentation back to you.
Filing Method: Mail, phone, fax, or online.
IRS fee: $0
Turnaround: Immediately online or by phone. 4 business days by fax. 4-5 weeks by mail.
Notes: The IRS website is only available during certain hours. Print your EIN before closing your session. For additional guidance, see IRS Pub 1635: Understanding Your EIN.
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Get Iowa State Tax Identification Numbers/Accounts
Iowa LLCs who need to register for sales tax, use tax, automobile rental tax, withholding tax, or corporation tax must file
- Submit to:
- Iowa Department of Revenue
http://www.iowa.gov/tax/ - Form:
- Form 78-005a: Iowa Business Tax Registration
- Guidance:
- Iowa Department of Revenue - Online Training
- Filing Method:
- Mail or online
- Fee:
- The state fee varies based on the tax accounts / licenses required.
- Turnaround:
- ~4-6 weeks
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Report Beneficial Ownership Information to FinCEN
As of January 1, 2024, millions of entities in the US need to report beneficial ownership information (BOI) to the Financial Crimes Enforcement Network (FinCEN) as part of the Corporate Transparency Act (CTA). LLCs formed before that date must submit BOI before January 1, 2025, while those formed after must submit it within 30 days of formation.
Our BOI reporting service completes the initial filing and provides support for updating your information going forward. We will:
- Submit your beneficial ownership filings to FinCEN
- Handle initial filing, updates, and changes as needed
- Ensure compliance with BOI reporting requirements for $149 per year
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Consider Electing S-Corp or C-Corp Taxation
By default, your LLC receives pass-through taxation and the vast majority of LLCs keep this tax classification. Some LLCs benefit from electing S-Corp or C-Corp tax treatment:
- S-Corp treatment can help owner-employees who earn more than ~$75,000 per year save on self-employment taxes. File Form 2553: S-Corp Election.
- C-Corps suffer from double taxation: the corporation pays taxes on profits then members pay taxes on their distributions. If profits exceed $250,000 per owner, you provide employee benefits, or you will re-invest most of your profit in the business, you may benefit from the low tax rates on retained earnings under C-Corp treatment. File Form 8832: C-Corp Election.
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Obtain Business Licenses & Permits
To run your business legally, you must obtain applicable licenses and permits. The easiest way to navigate the wide range of federal, state, and local requirements is to search by your business type and locality using the Small Business Administration Business License & Permit look-up tool.
Iowa Business License
Not required
General Business License licensure is not required on the State level in Iowa.
Iowa does not have a general business license at the state level, but local licenses are often required.
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Ongoing Filings to Maintain Your LLC
You must file federal and state tax returns.
Many states also require business entities to file an annual report to maintain good standing with the secretary of state. If an annual report is required for LLCs formed in Iowa, view the table below.
Iowa Corporation Annual Report Requirements:
Agency: Iowa Secretary of State Form: Available online. Click on the no account required option, search for your entity record, then select "File by Paper" to obtain a printable form.
Filing Method: Mail or online.
Agency Fee: $60
Due: By April 1 of even-numbered years. Reports may be filed as early as January 1.
Law: Penalties: No late fee. Your business can be dissolved or revoked within a few months.
Notes: - Anyone with authority may file.
- Original signatures are not required.
For more details, see our Iowa annual report information center page.
As your LLC grows, you will need to demonstrate your company’s good standing to banks, customers, and other state agencies. After all the work involved in forming your Iowa LLC, don’t let a missed annual report filing cause your new business to fall out of compliance.
Tracking and filing annual reports on your own can be time consuming and lead to accidental lapses. Protect your LLC’s good standing with Managed Annual Report Service, which tracks and automatically files reports on time, every time, so you can focus on your business.
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