How to Create an LLC in Iowa

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How to Form an LLC in Iowa:
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 Iowa, 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 Iowa LLC

Your first consideration when choosing a name for your LLC is that it be unique from any other business in the state of Iowa. You can quickly and easily do a name check on the Iowa Secretary of State website business name database to verify the business name you want is available. For a $10 fee through the Secretary of State website, you can reserve a business name for 120 days by filing an Application for Reservation of Name.

In order to comply with Iowa state law, your company’s name must contain some form of the term “Limited Liability Company.” This can appear as the whole phrase written out or the abbreviations “LLC” or “L.L.C.” You can also choose to use abbreviations for the words “Limited” and “Company” as “Ltd.” or “Co.” respectively. The words “bank,” “trust,” “trustee,” “incorporated,” “inc.,” “corporation,” “corp.,” “insurer,” “insurance company,” or any wording that suggests the company is an insurance business are not allowed in Iowa without providing a lengthy list of supporting documents.

Step 2
Appoint a Registered Agent in Iowa

The state of Iowa 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 Iowa or a business entity authorized to do business in Iowa so long as the agent has a physical street address within the state.

Step 3
File the Iowa Certificate of Organization
To officially create your LLC in the state of Iowa, you’ll need to complete the Certificate of Organization paperwork and file it with the Iowa Secretary of State Business Services Division. The state of Iowa does not provide Certificate of Organization paperwork or an application, but you can find some guidelines from the state here. You can have a lawyer draft this paperwork, complete it and file on your own, or use a third party service like ZenBusiness to file on your behalf. For a $50 fee, this can be done either online or by mail. To complete this form you will need to know the following:
  1. The final name of your LLC
  2. The name and address of the company’s registered agent

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 EIN and Review Tax Requirements

An IRS Employer Identification Number (EIN) is required for 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 Iowa Department of Revenue (DOR). 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 and if you have employees. The Iowa Business Tax Registration, Form 78-005, can be filed online or by mail.

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

Other Considerations
Foreign LLCs and Business Licenses
Foreign LLCs

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

You will need to file an Application for Certificate of Authority with the Iowa Secretary of State as well as a Certificate of Existence (also referred to as a Certificate of Good Standing) from your LLC’s domestic or home state. The Certificate of Existence must date back no more than 90 days prior to filing. The filing fee is $100.

Business Licenses

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

You can get federal licenses and perform an Iowa license and permit search on the appropriate licensing for your business.

Since business licenses and permits are issued at all levels of government and for such a multitude of reasons, you should still do careful research to find out what licenses and permits you need. You can also hire or use a professional service to do it for you.

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