Have you been thinking of starting a new business? Whether you want to open a flower shop or make your online freelancing business official, forming a limited liability company (LLC) can help give your business legitimacy and protect you from legal liability.
We’re going to be straight with you — forming an LLC in Indiana involves jumping through a few legal hoops. However, our team is full of LLC experts who are here to hold your hand through every step.
Here, we’ll cover the five principal phases of getting an LLC up and running in Indiana. By following this guide, you’ll be ready to open up shop in no time — at a surprisingly low cost. Once you’ve formed your new Indiana LLC, you can focus on growing your business. Let’s dive in.
The 5 steps to form an LLC in Indiana:
To start an LLC in Indiana, you must file the Articles of Organization with the Indiana Secretary of State. To help make your life easier, we’ve put together this step-by-step guide.
Step 1: Name Your Indiana LLC
When choosing a name for your LLC, you need to ensure that it is unique from any other business in the state of Indiana. You can do a quick business search on the Indiana Secretary of State website. There, you can verify that the LLC name you want is available.
If you want to reserve a business name before forming your LLC, you may reserve a business name by filling out an application and paying a $20 name reservation fee. Once you submit your name reservation, the Indiana government will hold the name for 120 days. If you want to extend your reservation for 120 more days, you can pay another $20.
To comply with Indiana state law, your company’s name must end with the words “Limited Liability Company” or one of two abbreviations, “LLC” or “L.L.C.” According to the Secretary of State, nothing in the LLC’s name can state or imply that the business’s purpose is different from the stated purpose in the LLC’s Articles of Organization. Plus, your business’s name should be distinct from any other LLCs already registered in Indiana.
After looking up names on the Secretary of State’s website, you should check whether your desired domain name is available. While many top-level domains exist — “.co,” “.net,” etc. — there’s nothing like getting the “.com” stamp of legitimacy to give some credibility to your business.
Next, visit the United States Patent and Trademark Office search trademark database to see whether anyone has already registered a federal trademark for your desired business name. If the name is taken, you may need to rename your LLC to avoid legal problems. There are also trademarks that happen at the state level. To see if your desired name has been trademarked in Indiana, check this search engine. You can see about securing your own Indiana trademark here.
While you don’t need a trademark to start doing business, registering your business’s name and logo can help prevent others from copying you.
Please note that you should also do this if you are interested in using a DBA or “Doing Business As.” A DBA is another name to use for your business. This will also need to be registered with the Secretary of State and County Recorder.
Step 2: Appoint a Registered Agent in Indiana
The state of Indiana requires every LLC to have a registered agent for service of process. Indiana registered agents physically accept correspondence from the Indiana Secretary of State and legal documents on the company’s behalf. Your registered agent can be a resident of the state of Indiana or a business entity authorized to do business in Indiana so long as the agent has a physical street address within the state. Some new business owners assume they should appoint themselves as their company’s registered agent. However, this approach may have hidden dangers. For example, you could be in the middle of a board meeting or client presentation when a process server walks in to deliver a giant stack of court documents, embarrassing you and derailing the meeting. Working with an outside registered agent service can help you focus on your business with reduced stress. Additional benefits of hiring an outside registered agent service include:
- Working when it’s convenient for you (a registered agent must be available during regular business hours)
- Not having to change your registered office address with the state if you move
- Ensuring you stay compliant and meet all deadlines
Step 3: File Indiana Articles of Organization
To create your LLC in the state of Indiana, you’ll need to file the Articles of Organization with the Indiana Secretary of State and a filing fee of $100. If you file online, the fee is $95. To complete the documents, you’ll need to know the following information:
- The name and address of your LLC
- The name and address of your company’s registered agent
- Whether the LLC’s duration will be perpetual or for a specified period
- Whether the LLC will be member-managed (managed by the LLC’s owners) or manager-managed (managed by a manager appointed by the LLC owners)
- The signature of at least one member (organizer or manager)
Step 4: Create an Operating Agreement
Operating Agreements outline the rules and procedures for the management of the LLC. However, unlike corporations, LLCs can customize their internal practices to fit the needs of the business. An Operating Agreement also makes your business more legitimate and helps protect the LLC’s owners from liability. While Indiana doesn’t require you to file an Operating Agreement, if you don’t have one, background Indiana state law applies to your company and determines how you must run your business. You should keep your Operating Agreement with your other business documents so you can refer to it easily. Typical concepts in an LLC Operating Agreement include:
- Procedures for admitting or removing LLC members
- Allocation of profits, losses, and ownership
- Management structure and voting requirements
- Dissolution and winding up of the LLC
Step 5: Apply for an EIN
Unless you’re a single-member LLC without employees, you’ll likely need to get an Employer Identification Number (EIN) from the Internal Revenue Service (IRS). Even if you don’t legally need an EIN, getting one can help you open a business bank account or obtain credit to grow your business.
To get an EIN, fill out the application on the IRS website. If you apply online, you’ll usually get your EIN within the same day. The EIN application is entirely free. You can also file a paper application, but the turnaround time is several weeks.
If your company has employees or collects sales tax, you may need to register your LLC with the Indiana Department of Revenue. For instructions on how to register your business, visit INBiz.
Every Indiana LLC (and foreign LLCs doing business in Indiana) must file a biennial Business Entity Report with the Indiana Secretary of State. The biennial report contains basic information like your LLC’s name, filing date, and registered agent information.
You’ll need to submit your report every other year in the anniversary month of your business’s formation. For example, if you created your LLC on Aug. 13, 2020, you would need to file your biennial report in August of every even year (2022, 2024, etc.). The fee for the report is $50 if submitted by mail and $32 if filed online.
How much does it cost to start an LLC in Indiana?
The fee for filing your Articles of Organization is $100 ($95 if submitted online) — the optional name reservation fee is $20. Each year, you’ll also be required to pay $50 or $32 with your annual report, depending on whether you file via mail or online. As discussed above, your business may also need to pay additional fees for Indiana-specific licenses and permits. For more information regarding license fees, visit INBiz.
What are the benefits of an LLC in Indiana?
The benefits of forming an Indiana LLC include:
- Separating and limiting your personal liabilities from your business debts and obligations
- Quick and simple filing, management, compliance, and administration of your Indiana LLC
- Easy tax filing and potential tax advantages
Learn more about the benefits of the LLC business structure.
How is an Indiana LLC taxed?
You’ll need to pay quite a few taxes if you operate an LLC in Indiana. These include taxes payable to the Indiana government, like sales tax and income tax. You also may need to pay income tax, self-employment tax, and a variety of other taxes to the IRS.
If you want help with your taxes, we recommend finding a trusted professional to help you file correctly.
Indiana LLC FAQs
- What is the processing time to form my Indiana LLC?
If you file a paper application, processing usually takes five to seven business days. However, if you file online, you’ll often receive a stamped copy of your Articles of Organization within 24 hours.
- Do I need to file an Operating Agreement with the state of Indiana?
No. The Operating Agreement is an internal document that you should keep on file for future reference. Like most states, Indiana doesn’t require LLCs to draft or adopt an Operating Agreement.
- What tax structure should I choose for my Indiana LLC?
When you get an EIN, you’ll choose between the different tax classification options that are available. Most LLCs elect pass-through taxation, where the LLC’s members are only taxed once on their earnings. rnrnIf you select corporate taxation, you’ll be taxed twice on your profits — once at the entity level and then at the individual level when you file your yearly tax returns.
- Does Indiana allow a Series LLC?
In a Series LLC, multiple categories of members, managers, or LLC interests have distinct ownership, rights, and legal obligations. Many owners use Series LLCs to protect separate business units from cross-liability. Although not many states permit a Series LLC to be formed, Indiana does.
- Which licenses and insurance are required for an LLC in Indiana?
INBiz has a list of permits and business licenses your LLC may need to obtain to remain compliant with Indiana state law. Licensing also happens at the federal and local levels, and different industries require different licenses and permits. Be sure to research what licensing your business needs, or hire a professional service to do it for you. rnrnFor questions about what insurance you need for your LLC in Indiana, contact the Indiana Department of Insurance.