How to Create an LLC in Arkansas

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How to Form an LLC in Arkansas:
5 Simple Steps to Get Started
According to the IRS, each state may use different regulations around forming an LLC, and you should check with your state if you’re interested in starting a Limited Liability Company. To simplify the process of forming an LLC in the state of Arkansas, we’ve put together a step-by-step guide to detail each step of the process and answer any questions you may have.

Step 1
Name Your Arkansas LLC

Your first consideration when choosing a name for your LLC is that it be unique from any other business in the state of Arkansas. You can quickly and easily do a name check on the Arkansas Secretary of State website to verify the business name you want is available. For a $22.50 fee, you can reserve a business name for 120 days by filing the Application for Reservation of Limited Liability Company Name online. The fee is $25 if done by mail.

In order to comply with Arkansas state law, your company’s name must end with some form of the term “Limited Liability Company.” This can appear in several different formats from the whole phrase written out to several appropriate abbreviations. “Limited Company,” “L.L.C.,” “LLC,” “L.C.,” and “LC” are all considered appropriate ways to adorn your moniker. You can also choose to use abbreviations for the words “Limited” and “Company” as “Ltd.” or “Co.” respectively. Words and phrases suggesting that your LLC has an illegal purpose or one that is different than the purpose stated in the articles of organization aren’t allowed.

If your company provides professional services, its name must use the words "Professional Limited Liability Company," "Professional Limited Company," or the abbreviations "P.L.L.C.," "P.L.C.," "PLLC," or "PLC." The name cannot contain the name of anyone who is not a member unless that member is deceased.

Step 2
Appoint a Registered Agent in Arkansas

The state of Arkansas requires that any LLC have a registered agent for service of process. This means your LLC must have an entity that agrees to physically accept any legal papers on the company’s behalf should it be sued. This entity does not have to be an individual person. The registered agent can be any resident of the state of Arkansas or a commercial agent (LLC or corporation) authorized to do business in Arkansas so long as the agent has a physical street address within the state.

Step 3
File Arkansas Articles of Organization
To officially create your LLC in the state of Arkansas, you’ll need to complete the Articles of Organization paperwork and file them with the Arkansas Secretary of State. For a $45 fee, this can be done online; by mail, the fee is $50. To complete this form you will need to know the following:
  1. The final name of your LLC
  2. The name, address, and signature of the company’s registered agent
  3. A statement of how the LLC will be managed

Step 4
Create an Operating Agreement

You may want to consider preparing an operating agreement to outline the ownership and operating procedures for your LLC.

Though not required by the state, an operating agreement will set the guidelines for running your company. This does not need to be filed with the state, but it can go a long way toward ensuring your company’s success.

Step 5
Apply for an Employer ID Number (EIN)

An IRS Employer Identification Number (EIN) is required of your LLC unless it is a single-member LLC with no employees. Obtaining an EIN is as easy as completing the application on the IRS website.

It’s possible your company will need to register with the Arkansas Department of Finance and Administration. Whether or not your company needs to follow this step will depend on the exact types of taxes it will be collecting and/or has been collecting from the state as well as whether you have employees. The Combined Business Tax Registration Form, form AR-1R, can be filed online at the Arkansas Taxpayer Access Point.

If your LLC will be selling a physical product, you’ll need to register for a sellers permit through the Arkansas Office of Tax and Revenue website. This will allow you to collect sales tax on taxable sales. If you have employees, you’ll need to register for Unemployment Insurance Tax through the Arkansas Division of Workforce Services and also register for Employee Withholding Tax through the Arkansas Office of Tax and Revenue.

Additionally, all LLCs in Arkansas must pay an annual $150 business tax. This will be done each year by May 1 in conjunction with filing annual reports.

Other Considerations
Foreign LLCs and Business Licenses
Foreign LLCs

If your company is a foreign LLC, also referred to as an out-of-state LLC, wanting to do business in the state of Arkansas, you’ll need to follow all the steps outlined above with a few minor differences.

You will need to file an Application for Certificate of Registration of Foreign Limited Liability Company with the Arkansas Secretary of State as well as a Certificate of Existence from your LLC’s domestic or home state. The filing fee is $270 for online filings and $300 for paper filings.

Business Licenses

Some industries will require you to secure federal and/or local licenses to legally operate in the state of Arkansas.

Because business licenses and permits are issued at all levels of government and for such a multitude of reasons (e.g., health, building, signage, etc.), there isn’t one central location where you can check to see if your business has everything it needs to be compliant. Do careful research to find out what licenses and permits you need or hire a professional service to do it for you.

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