Start your business
Fortunately, ZenBusiness has a helpful, customizable Operating Agreement template at an affordable cost to speed up the process. Plus, unlike the Certificate of Organization, you don’t need to file your Operating Agreement with the Iowa Secretary of State or pay any fees. Working with a professional to help draft your company’s Operating Agreement is a simple and prudent investment in your business’s future.
After forming your new LLC with the Iowa Secretary of State, you’ll need to register with the federal government. Specifically, you may need to obtain an Employer Identification Number (EIN) from the Internal Revenue Service (IRS). An EIN functions like a Social Security number for your business, allowing you to perform critical functions like hiring employees, applying for a business bank account, and paying taxes.
Thankfully, you can apply for an EIN through the IRS website and have it issued immediately. Better yet, the application process doesn’t cost anything to complete. You can also submit your request by mail, but the turnaround time is at least four weeks. As a result, you may want to apply online to save some time and start doing business as quickly as possible.
As mentioned earlier, the cost of filing your LLC’s Certificate of Organization is $50. If you reserve your business name before filing, you can add another . In total, state fees for forming an LLC in Iowa typically amount to $60.
That doesn’t include ongoing costs like filing your biennial report (a $60 fee due on odd-numbered years) or the added time required to ensure you’re in good standing. Worrying about these little nuances takes time away from growing your business.
That’s where ZenBusiness can make a big difference — we provide practical support and expertise, guiding you through the entire LLC formation process. When you sign up four our business formation services, we’ll complete and submit your business filing paperwork, serve as your registered agent, and draft an Operating Agreement for your new LLC.
Our more comprehensive plans also handle other essentials, such as getting an EIN and complying with state regulations. We offer certainty and peace of mind at an unbeatable price.
LLCs are among the most popular business structures because they afford plenty of protection without a ton of complex requirements. Compared to corporations, LLCs operate with far more flexibility and avoid certain kinds of taxation.
Iowa is no exception — an LLC is an excellent choice for small business owners across the state. The benefits of forming an Iowa LLC include:
For an in-depth explanation of the benefits of the LLC business structure, check out our comprehensive article.
If you file online with the Iowa Secretary of State’s Fast Track Filing system, your Certificate of Organization is typically approved within 24 hours. If you choose to submit by fax or mail, processing time ranges from several days to several weeks.
No, you do not need to file your LLC’s Operating Agreement with the state of Iowa. In fact, Iowa doesn’t require LLCs to create an Operating Agreement at all. However, drafting an Operating Agreement legitimizes your business, prevents future disagreements between the business’s owners, and tailors the LLC’s rules to fit your needs and expectations.
Most entrepreneurs elect pass-through taxation at the state and federal levels — owners pay state and federal taxes on the income they earn from the business, but the LLC does not pay taxes as an entity.
If an LLC has multiple members, the IRS by default classifies it as a partnership for tax purposes, requiring each partner to pay taxes on their fair share. You can customize your ownership percentages in your LLC’s Operating Agreement.
Some LLCs (particularly those with very high earnings) may choose to file taxes as corporations. This option has some distinct tax advantages, which you can learn more about here. We suggest working with a professional who can explain the benefits and drawbacks of each tax regime.
Iowa law does permit the formation of a Series LLC structure, where several separate LLCs operate under one overarching “umbrella” LLC entity. The individual LLCs (sometimes called “cells”) may have different members, assets, and obligations. In theory, individual cells and the umbrella LLC are insulated from the debts and legal liabilities of the others, providing valuable protection for some small businesses.
The Iowa SBDC has a wealth of helpful resources that can determine whether you’ll need to secure any special permissions, like licensees and insurance, before starting to do business. You should also check with your municipal government to see whether any local laws or regulations apply to your business. Licensing also happens at the federal level and can be industry-specific. You’ll need to thoroughly research what licenses and permits your company needs or hire a service to do it for you.
Instead of an annual report, Iowa LLCs are required to file a biennial report by April 1 on odd-numbered years. The report ensures your registered agent address is correct and requires a $60 filing fee. All LLCs are required to file their biennial report with the Iowa Secretary of State to be in good standing.
If you decide to dissolve your business, you’ll need to file a Statement of Dissolution online with the Iowa Secretary of State. In addition, you’ll have to take care of the business’s affairs, including discharging debt and selling the company’s assets. Finally, you can distribute any remaining profits (or losses) between the LLC’s members.
We hope you’ve found this guide helpful, empowering you to form an LLC in Iowa successfully. Of course, you don’t need to handle all these steps yourself. At ZenBusiness, we’re happy to take care of the entire process for you. Reach out to us today to learn more about how we can guide you on your LLC formation journey.
Want to learn more about starting a business in Iowa? Contact us today!
Already an Iowa small business owner? Learn how ZenBusiness can help you run or grow your Iowa small business!
Input your search keywords and press Enter.