How to Start an LLC in Hawaii: If you’re interested in setting up a Hawaii LLC, you’ve come to the right place. Having an LLC not only protects your personal assets but also is less complicated than other business structures. Hawaii laws make it easy to establish your LLC in Hawaii. On this page, You’ll find all the steps that must be taken to ensure that your Hawaii LLC has been correctly established. We recommend you read the whole article very carefully word by word, don’t miss anything 🙂
On this page, you’ll learn about the following:
- How to Start an LLC in Hawaii
- After Starting Your Hawaii LLC
- Hawaii Foreign LLC
- Best Business Niches in Hawaii
- Hawaii LLC Formation Review
How to Start an LLC in Hawaii
An LLC or a Limited Liability Company is a hybrid business entity combining a corporation’s characteristics with a partnership or sole proprietorship. It separates your personal assets from your business assets, thus giving you personal asset protection.
If you wish to start an LLC in Hawaii, mainly you have to file your Certificate of Formation with the State and pay a filing fee of $50. There are some more steps to follow to get your LLC established in Hawaii. The following steps explain everything you need to create your LLC in Hawaii in 2022. Let’s get started!
Step 1: Decide a Name for Your Hawaii LLC
The very first step while forming an LLC in Hawaii is to give a proper name to your LLC. Before you name your business, you must know that the name should be easy to remember, available in the state, and follows all the LLC naming guidelines.
Hawaii LLC Naming Guidelines
There are a few specific requirements all the LLCs in Hawaii have to follow while naming their Company. Some of the most important requirements are as follows:
- Your business name should be available and no other existing business in Hawaii can have the same name. Perform a name search from the below-mentioned source to be sure your name isn’t taken already.
- “Limited Liability Company”, “LLC”, and “L.L.C.” – any one of these has to be used as a suffix in your business name.
- You cannot use any name for your business that is confusing or misleading. Terms such as “Treasury”, “State Department”, “FBI”, “CIA”, etc. shouldn’t be included.
- Terms like “Bank“, “University“, “Attorney“, “Doctor“, etc can be added only after the additional requirements by Hawaii State Government are fulfilled.
- (Optional) It’s better to name your business something for which your desired domain is available.
|Important Links –||Submit Offline Form to –|
|Hawaii Business Entity Search – Online Name Search|
Name Reservation Form – PDF
Name Availability Standards – Guidelines
Hawaii LLC Name Search – Instructions
|Department of Commerce and Consumer Affairs|
Business Registration Division
P. O. Box 40
Honolulu, Hawaii 96810
Reserve Business Name for Future
If you do not wish to file your LLC right now but want to hold the name you have decided then you can reserve your LLC name for 120 days. To keep the name, you have to file a name reservation application and pay $7.50 (online) and $10 (By mail) to reserve your name with the Hawaii Secretary of State.
Doing Business As (DBA) or Trade Name
Once you have a legal name for your LLC, you can register it. However, it is not mandatory. You can, instead, use DBA, Fictitious Name, or Trade Name. In that case, you must register your name with the Hawaii Secretary of State by submitting an Application For Registration of Trade Name in Hawaii along with the filing fee of $50.
Recommended: You can do name search, get company logo, business domain, website, emails, and a lot more in one place by hiring a professional service. We recommend using –
Tailor Brands – ($49 + State Fees) Online LLC Setup
Tailor Brands offer DIY website templates and incredible logo designs. If you plan to get a website then it is wise to have a “.com” domain for your business but these days you can also use other TLDs like “.company”, “.xyz” etc. With Tailor Brands, you can get everything you need at an affordable price.
It is not legally mandatory to use the word LLC in your domain name or email. If you want you can use it. However, it is recommended not to use LLC in the domain name. A domain name should be short and easy to remember.
Step 2: Assign a Registered Agent in Hawaii
The second step to forming a Hawaii LLC is to appoint a Registered Agent. A registered agent is a person or business entity that will act or work on your LLC’s behalf. This person or business will receive important tax forms, legal documents, all notices of lawsuits, and other official government correspondence in Hawaii. Hence, hiring a competent Hawaii Registered Agent for your LLC is necessary.
Make sure your registered agent is a resident of Hawaii or has a physical street address. Their business address or the principal address should be in Hawaii. Most LLC formation companies also provide registered agent services. Below are two great LLC setup services, even if you buy their cheapest plan (normally $49/year) you also get registered agent service and other services at a reasonable price.
These LLC formation services are recommended registered agent services as they are authorized to conduct business in Hawaii. Some LLC formation services offer standalone Hawaii registered agent services. You can purchase only Registered Agent services from them without purchasing any other LLC formation services.
A person who is above 18 years of age and has a physical address in the state of Hawaii can be a Registered Agent. A Registered Agent can be an independent person or can be a business entity. One who is responsible for handling all the legal documents.
Yes, you can be your own registered agent if you are a resident of the state of Hawaii and you are above 18 years of age. To become a registered agent you must have the authority to conduct any type of business in Hawaii.
Step 3: File Articles of Organization in Hawaii
The third and most important step in forming a Hawaii LLC is to file the Certificate of Formation. This Hawaii Articles of Organization is a legal document needed to officially register your business with the Secretary of State. It costs $50 (by mail and online) +$1 as State Archive Fee to file your formation certificate in Hawaii. (Read more on LLC cost in Hawaii).
The Certificate of Formation includes details like the name of the LLC, registered agent’s name, address, employees’ details, and structure of the company (member-managed or manager-managed). Before hiring employees in Hawaii LLC, one should know about the rules and regulations thoroughly. Also if you are expanding your existing business (an LLC) to Hawaii then you need to register as a Hawaii Foreign LLC.
How to File Online
Go to the Secretary of State Online Service. You will get the online service page. If you are already a subscriber then click on the “Get Started” option under the “Start” tab and log in with your credentials on the next page. If you’re not subscribed, then you need to Sign-up first. Click on the button below to Sign-up or log in. Read more about the Hawaii Articles of Organization for online registration.
How to File by Mail
If you prefer filing real-life forms for your Hawaii LLC registration, then you can download Domestic LLC Form LLC-1. Read the form thoroughly, fill it out, and mail it to the following address,
Department of Commerce and Consumer Affairs
Business Registration Division
335 Merchant St.
P.O. Box 40
Honolulu, HI 96810
335 Merchant St.
Honolulu, HI 96813
Fax: (808) 586-2733
Processing Time: It takes around 2 weeks to form an LLC in Hawaii. By paying an additional fee, it can be expedited.
Recommended: Online LLC Formation service can provide all these documents within 6-8 days with lifetime customer support and 100% accuracy. We recommend using –
Tailor Brands – ($49 + State Fees) Online LLC Setup
Step 4: Create Your Hawaii LLC Operating Agreement
Moving on to the fourth step, filing your operating agreement. An operating agreement is a document that legally outlines the proprietorship and operating procedures of your LLC. This document is vital as it ensures that all business owners are on the same page regarding how they operate, thus reducing future conflicts.
When it comes to filing a Hawaii LLC Operating Agreement, the state does not require you to have a comprehensive operating agreement, but it is ideal to have one that contains all the details of your business operation. Like Hawaii, there are other states that do not have a mandatory rule to file operating agreements. But, this document would be useful if you decide to dissolve Hawaii LLC later. Hence, having an operating agreement may not be necessary but it is definitely ideal.
Recommended: You can get operating agreement templates at only $29 with TailorBrands. You don’t need to worry about drafting it as they will take care of it on your behalf. We recommend using –
Tailor Brands – ($49 + State Fees) Online LLC Setup
Step 5: Filing a Hawaii LLC EIN
The Employer Identification Number or, simply, the E.I.N. is a nine-digit number given by the Internal Revenue Service (IRS) to make it easier to identify the type of business for tax purposes and taxes in general. The EIN is necessary for any active business or any form of business for that matter.
EIN is needed when the LLC hires employees. Hiring employees in Hawaii LLC requires following specific rules and regulations. On the other side, EIN for Hawaii foreign LLC should be obtained if your LLC is based in other states.
To obtain EIN (aka FEIN) one has to fill up a form (Online or by mail) and submit it to the IRS. Enter details of your LLC, and finally complete the form and send it to the address given. You can also get an EIN Assistant who can help you with the process.
Mail to: Internal Revenue Service, Attn: EIN Operation, Cincinnati, OH 45999
Fax: (855) 641-6935 | Fee: Free
Recommended: This hassle will be reduced when you hire an LLC formation service. They take care of obtaining EIN and all other things for your LLC. We recommend using –
Tailor Brands – ($49 + State Fees) Online LLC Setup
Note: You don’t need a Social Security number when getting an EIN. You can proceed to fill out I.R.S. Form SS-4 and leave section 7b blank. You must then call the IRS at (267) 941-1099 to complete your application. Agents or employees will help you with that.
Congratulation, you are now done with all the necessary steps to form your Hawaii LLC. If you do it yourself it should take you a long time to properly understand and do all the steps.
However, if you use TailorBrands it should take fewer hours and you always have live chat with expert support for any help you need.
After Starting Your Hawaii LLC
After forming your LLC, there are still some things that you will need. Take note of the following:
- Get a company business bank account
- File Hawaii business permits & licenses
- Get general liability insurance and professional liability insurance with coverage for employees
- File a Hawaii LLC annual report or biennial report
This page has provided you with steps to LLC formation and filing processes. You now have to remember upcoming filing deadlines and filing fees or filing costs, including fees for late filings to make sure your LLC is up-to-date.
Cost of Hawaii LLC
Forming an LLC in Hawaii is no doubt more cost-effective than other structures of a business. There are some fees and charges one has to bear to form a Hawaii LLC. LLCs have pass-through taxation. Hence, your Hawaii LLC won’t bring you a massive tax burden. Here are some of the fees and taxes are needed to be paid while forming an LLC in Hawaii,
|Fees/Tax||Amount to be Paid|
|Name Reservation Fee (online)||$7.50|
|Name Reservation Fee (By mail)||$10|
|Articles of Organization Fee||$50|
|LLC Annual Fee||$12.50|
In Hawaii, an LLC name reservation is not mandatory. You can register your LLC name at the time of registering your LLC. If you wish to hold the name for some time without registering your LLC, then you can do that online. Your LLC name will be reserved for 120 days without registering your LLC.
In Hawaii, an Annual Report has to be produced every year. It costs $12.50. The state of Hawaii does not have any Sales Tax, instead, it has various general excise taxes starting from 0.15% on insurance commission to 4% on other products. Read our guide on LLC costs in Hawaii for more information.
Hawaii Foreign LLC
If you are interested in forming a Foreign LLC in Hawaii then you need to file the Certificate of Foreign LLC to the Hawaii Secretary of State. Foreign LLCs allow you to operate your business in more than one state. Along with the Certificate of Foreign LLC, you need to submit some more documents like the Certificate of Good Standing, etc. to the Hawaii SOS to form your foreign LLC in Hawaii. To know more in detail, check out our guide on Hawaii Foreign LLC.
Reasons to Start an LLC in Hawaii
When it comes to Hawaii, people think of a tourist spot. But, it is surprising how over 128,000+ small businesses are operating in Hawaii and created around 3700+ jobs today. The growing economy in this state attracts more businesses than in earlier times. EZ, several business funding options, and tax credits are some prominent benefits of starting an LLC in Hawaii.
Growing Strong Economy
Hawaii is having more than 31,000 active LLCs at this moment. Every year around 7500+ LLCs is being formed in this state. The growing strong economy makes it easy for businesses to create jobs and employment opportunities.
Hawaii Incentive programs
The biggest incentive program available in this state is the Enterprise Zones program. Administered by the Department of Business, Economic Development & Tourism, the program offers tax credits to the LLCs operating in special economic and enterprise zones. Creating more jobs, developing stressful areas, and developing projects gain more incentives in Hawaii.
No Double Tax assurance
Double tax is the fear of every person who is thinking of making an LLC. They always think of how they can save themselves from the double taxes, and their search ends up with LLC in Hawaii. The government ensures that the LLC will be taken through a process that will save their double tax. It increases the potential profits of the member. Read more on Hawaii’s classification of LLC Tax.
Enjoy Benefits of the Corporation
The liability protection is provided to every corporate member, but if one chooses Hawaii LLC, they also get the premium services of the liability protection. If the LLC is under any debt, then the creditors cannot move to the assets of the members of the LLC to recover their money.
Best Business Niches in Hawaii
If a person wants to Start an LLC in Hawaii, they have to find the best niche. There are many industries, but new businesses in the state are left in a few industries. Pick a niche, meet the LLC formation requirements, pay the filing fees, and start your LLC in Hawaii. Here is the list of the best businesses one can consider.
Hawaii apparel maker Business
Hawaii is a beach state which is known for its locally-made apparel. The most sold clothing in the state is Aloha shirts which are made in local manufacturing units. The first manufacturing unit started in the 1960s, and till that time, the demand for this apparel has never decreased. The apparel industry is still booming, giving opportunities to new businesses also.
Vacation renting services
Being a beach state, the state of Hawaii is flooded with tourists every time of the year. The state has noticed a footfall of around 10 million people in 2019, which increased about 5.4% from the previous figure. Now, these tourists need a place to stay when they visit the state. You can plan space and provide renting services to the tourist and provide the best value for reoccurring services.
Tourist Guide Company can also be a profitable business in the state. There many points of attraction in the local area of the state which one can visit for which a tour guide is a must. As mentioned above, the number of people visiting the state is increasing, so the demand for catering to them is the best guide services.
Boat owners and renting companies
Boating in the middle of the sea is still loved by most people visiting Hawaii. That is why you can plan to open a boat renting company nearby the beach. Now all you need to do is start advertising your business among the tourists and earn huge bucks.
Some small businesses that a person can also think of are:-
- Business advertisement companies
- Landscaping business
- Small grocery store business
- Weeding photography
Hawaii LLC Formation Review
Time needed: 5 minutes.
Just to recap, here are the easy steps again when forming an LLC in Hawaii. Click on the steps in this list to read the full detail.
- Name your Hawaii LLC
The first thing you must do is to choose a company name, which should be unique, easy to find, and available in the state.
- Choose a Registered Agent
In Hawaii, it is mandatory to select a registered agent for your LLC. Get a professional Registered Agent from LLC formation services like NorthWest Registered Agent to get things done hassle-free.
- File a Formation Certificate
Filing a formation certificate is necessary when forming an LLC in Hawaii. Depending on the state, it could be called any of the following: Certificate of Formation, Articles of Organization, or Certificate of Organization.
- Create an Operating Agreement
An operating agreement is not a strict requirement in Hawaii but something encouraged when you start an LLC to avoid future conflicts.
- Get an EIN
The Employer Identification Number (EIN), also called Federal Tax Identification Number, serves to identify a business entity like a social security number but for a company.
How Fast Can I Form an LLC in Hawaii
The LLC filing procedure in Hawaii takes upto 2 weeks, depending on the number of applications. This process can be expedited by paying additional fees.
If you’re wondering how fast it is to form an LLC in Hawaii, there are a few steps you must follow. First, you must choose a Registered Agent. This person must be a resident of Hawaii with a physical street address. The Registered Agent receives important legal documents on your behalf. You should also be aware that the name and address of the Registered Agent will be public records. This can be a concern for privacy. Choosing a Registered Agent in the Pacific Northwest can help you reduce unwanted mail and phone calls.
Once you have selected a name for your business, you can begin the process of LLC formation in Hawaii. The Hawaii Business Registration Division will review your application, and you should receive a response within 5-7 business days if you file online. The process of filing a paper form may take up to three weeks, but you can opt for expedited processing if necessary. Once your LLC is approved, you’ll receive a letter from the state’s Department of Commerce and Consumer Affairs, which is the official place where you can file your tax reports.
You can also choose an assumed name for your business. This option allows you to keep the LLC name and operate under another trade name. However, the name must meet certain requirements set by the Hawaii Department of Commerce and Consumer Affairs. Also, you must appoint a registered agent for your LLC in Hawaii. Assigning a registered agent is a requirement for all LLCs in Hawaii. Fortunately, it is fairly easy to select a registered agent.
In general, LLCs are cheaper to form than other types of businesses. Even small businesses with only one or two employees can establish an LLC in Hawaii with little expense. Another benefit of forming an LLC in Hawaii is the ‘pass-through’ taxation. This means that you don’t have to pay double taxes on the profits or losses of your business. Additionally, limited liability companies have fewer legal processes.
Once your company is approved by the state, you can begin working on your operating agreement. This document details the duties of each member, including the money, voting rights, and selling stakes in your company. You should also sign an operating agreement with the state to protect your limited liability status. You can create an operating agreement with help from Nolo’s Online LLC. If you’re wondering, “How Fast Can I Form an LLC in Hawaii?” consider our guide.
Depending on the type of company you’re starting, you can form an LLC without an attorney. You’ll need to choose a name that is distinguishable from other businesses. You don’t need an attorney to form an LLC in Hawaii. A short list of LLC names can help you choose a good company name. The name you choose should be memorable and unique, but not too unique. There are some legal requirements that will require you to meet these requirements.
If you are a resident of Hawaii, then you can file your LLC by yourself. However, it is always worth having a professional than doing it yourself to handle legal complexities, paperwork, and other documentation.
Apart from the formation fee of $50 (domestic LLC) and $50 (foreign LLC), LLC costs in Hawaii include $12.50 for Annual Reports every year. LLCs are not liable to pay sales tax but have to pay various general excise taxes.
It takes 2 weeks to get an LLC in Hawaii if you file it online. If you hire a professional LLC service, then it might take less than that. We recommend Tailor Brands which has impeccable turnaround time.
Every year all the LLCs have to submit an Annual Report and pay $12.50 to the Hawaii Secretary of State and renew the LLC. It is mandatory to renew your LLC every year.
Generally, for the LLCs, it is a default tax structure. Once you will obtain the EIN, you will get the various tax structure options to select. Sometimes LLCs choose S Corp to reduce federal tax burdens. Read more on the Hawaii Classification of LLC Tax.
LLCs are easier to establish than other business structures. Small businesses, especially start-ups can easily start an LLC in Hawaii at a bare minimum cost. LLCs have a ‘pass-through taxation’ advantage for which they are excluded from certain taxes. The formation of limited liability companies requires much lesser documents and legal processes. Share your queries with us, and leave a comment below.