Having an Indiana LLC is a better and cheaper option than having other business structures. A limited liability company (LLC) reduces the owners’ personal liability and protects their personal assets. One can start an LLC in two ways, domestic LLCs or foreign LLCs (LLCs in more than one state). By following some basic steps, you can easily form an LLC in Indiana.
On this page, you’ll learn about the following:
- How to Start an LLC in Indiana
- After Starting your Indiana LLC
- Indiana Foreign LLC
- Why an LLC in Indiana
- Top 3 Businesses Running In Indiana
- Indiana LLC Formation Review
How to Start an LLC in Indiana
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. This section gives you a step-by-step guide on how to start an LLC in Indiana.
Step 1: Decide a Name for Your LLC
Deciding on a business name is the first step to starting an LLC. In Indiana, before you name your LLC, it is important to note a few things. Firstly, make sure the name is available to use. If the name is available, then check if the name complies with all the Indiana business naming requirements. Once you pass through them, you can successfully name your business.
Why do you need a proper business name?
If you want your LLC to have special identification, your company name is essential. However, many people face lots of issues by avoiding focusing on choosing a business name for their LLC business formation filings.
Because of this, here are some of the major benefits of choosing the best LLC corporate names.
- To help establish a company’s presence in the market, a proper business entity type will help you. This also creates a new identity that will resemble your LLC.
- After you’ve properly chosen the name for your LLC, you will have no problems finishing the registration process.
- You can only get the EIN number when you have your name registration certificate with you.
Requirements when deciding a name for your LLC
LLC Name Search: A business name search is required to check if the desired name is available or not. If the name is available then the business owner has to fill up a name reservation form and submit it to the Secretary of State, Indiana. To do the name search, one has to visit the Business Entity Search page on the official Secretary of State website. Submit the name reservation form online to reserve your LLC name in Indiana. The cost of a name reservation is $10.
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Step 2: Assign a Registered Agent in Indiana
A registered agent for service is a person or business entity that will act or work on your behalf. This person or business will receive significant tax forms, legal documents, legal forms, an internal document, a notice of lawsuits, and other official government documents in Indiana. Choosing Indiana registered agents for your LLC is required. These professional service providers help LLCs with filing federal taxes, corporate taxes, formation documents, annual report service, and so on to run a successful business.
Make sure your registered agent service providers are residents of Indiana. They must have a physical address in the state. It could also be a business. Here is a list of the recommended registered agent service for you:
Note that availing of the services of professional registered agents would be your best option since you are guaranteed that whoever is handling your legal affairs knows their stuff well. You will enjoy peace of mind and focus only on running your business, as the ‘professionals’ take care of all legal matters.
These LLC formation services are recommended registered agent services as they are authorized to conduct business in Indiana. Compare them to check the best yet cheapest option for you. Besides, they can guarantee you professional service because they have been in the business for years.
Step 3: File Articles of Organization in Indiana
A Certificate of Name Reservation is needed to file Indiana Articles of Organization, as other states call it. You need to make reports of this certificate with the Indiana Secretary of State. LLC cost in Indiana includes filing fees, other taxes, and fees. You may file them online or by mail.
Before you start filings, you must already have your LLC name and registered agents or employees. You will attach a copy of your Name Reservation Certificate along with a list of the services that your Indiana LLC will offer.
How to File Online
Go to the Secretary of State Online Service. Select “non-subscriber.” Fill out the online form. The website will alert you if your county does not support online filings after selecting your principal county. To know more about online filing, visit the Indiana Certificate of Formation.
How to File by Mail
If you prefer filling in paper forms for your Indiana LLC registration, then you can download the Indiana Limited Company Certificate of Formation and you can submit the form by mail. Read the form thoroughly and fill it out. It will have to fill, among others, your name, city, state, zip code, and signature. You may also file in person by visiting the office on business days.
Mail To: Secretary of State Business Services Division
302 West Washington Street
Indianapolis, IN 46204
Step 4: Create Your Indiana LLC 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 an LLC operating agreement Indiana does not require you to have a comprehensive operating agreement, but it is ideal to have one that contains all your details of business operation. This document would be useful if you decide to dissolve Indiana LLC later.
Step 5: Filing an Indiana 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 types of business for tax purposes and taxes in general. It is like a Social Security number dedicated to a business’ taxes. 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 Indiana LLC requires specific rules and regulations. One should know about them before hiring employees. EIN for Indiana 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. Before sending the form, ask for EIN Assistant. Enter details of your LLC, and finally complete the form and send it to the address given.
Mail to: Internal Revenue Service, Attn: EIN Operation, Cincinnati, OH 45999
Fax: (855) 641-6935 | Fee: Free
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.
And that’s all! Congratulation, you are now done with all the necessary steps to form your Indiana LLC. If you still haven’t used a professional service from here, I strongly recommend having one to handle the remaining tasks.
After Starting your Indiana 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 Indiana business permits & licenses
- Get liability for business and professional liability insurance with coverage for employees
- File a Indiana LLC annual report or biennial report
- Already existing LLCs that wish to operate in Indiana must register as Indiana foreign LLC.
This page has provided you with broad 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.
Indiana Foreign LLC
To register an Indiana foreign LLC, one has to file the foreign LLC formation certificate with the Secretary of State, Indiana. Forming a foreign LLC allows you to operate your business in more than one state in the USA as a single business entity. Check Indiana Foreign LLC to know more about having a foreign LLC.
Why an LLC in Indiana
With the Gross State Product worth $336 Million, Indiana has gained a position in the Top 10 business states by Forbes. Along with tax benefits, there are some long-lasting benefits to starting an LLC in Indiana. If you have a woman-owned business then you can get additional benefits from the state. On the tax part, LLCs with employees have to pay certain employment taxes. The benefits that a business person will enjoy when they start LLC in Indiana are below,
Reporting is made biennial by the government
Reporting of any business by the government takes considerably high time. It nearly disturbs the whole working set-up of a company, but if you have LLC in Indiana, you don’t have to care about it much. Here the government has set the reporting of an LLC twice a year which makes it easy for the member, and above that, the filing fee is only around $32 if a person is filing the report online.
Continuous decreasing rates of Income-tax
In Indiana, the tax is only required to pay by the LLC members on their personal profits. This rate of personal income tax is meager, i.e., 3.23%. It means that the LLC profits don’t matter if your profit is 100,000 USD or 10,000,000, then the tax one member has to pay will be the same for all the levels of people. Read more on Indiana’s classification of LLC Tax.
Hoosier Business Investment Tax Credit
The Hoosier Business Investment is an incentive-based program that is provided to the LLCs, mainly the start-ups. The main motive of this Tax credit is to provide some investment to the start-ups and support the task of job creation in the states through these LLCs. This will improve the financial status of the state and also the standard of living.
No sales taxes are applied
Many states impose sales taxes on their LLC, like taking nickel and dimes from members’ pockets. But in Indiana LLC, these taxes are not imposed on them, which means that they only have to pay the basic sales tax, which leaves them with plenty of money for hiring and research, and development.
Top 3 Businesses Running In Indiana
If you are an entrepreneur and want to Start an LLC in Indiana, you must have a business idea. For starting the legal formalities, you need a complete business idea and company name. If you are still looking for the best business, then here are some of the best ones.
The automobile sector in Indiana is the one that has helped in recovering the state from unemployment. This field’s employment generation is so massive that it has helped more than 20,000 employees come from other states and work daily. You can choose any one of the best manufacturing fields which fascinate you the most and start setting up your business.
The state of Indiana is known for producing products that are used in the medical sector. It includes various types of equipment, both surgical and non-surgical. The quality of Indiana products is high, which attracts people towards the orthopedic capital of the world. Moreover, the business owners are offering 50% more wages to their workers, which shows how profitable this business can be for you.
Renewable energy Business
The business related to renewable energy is settling well in the state and is appreciated by the government. They have some attractive offerings to those who are investing their money in renewable energy sources. Today the state has around six hydro plans, and 16 biofuel plants are aimed at serving clean and better energy to the people.
Moreover, the largest 17.5 MW solar energy plant is also present in Indiana, making it the biggest plant in the country. The business gives plenty of options and opportunities to work for the betterment of humanity.
If you are looking to invest some money in a small business then the businesses are:-
- E-commerce consultancy
- Smartphone and accessory business
- Gym and fitness center
Indiana LLC Formation Review
Time needed: 5 minutes.
To recap, here are the basic steps again when forming an LLC in Indiana. Click on the steps in this list to read the full detail.
- Name your Indiana 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 Indiana, it is mandatory to select a registered agent for your LLC. You can check out our list of our 5 Best LLC Services in the United States.
- File a formation certificate
Filing a formation certificate is necessary when forming an LLC. Depending on the state, it could be called any of the following: Certificate of Formation, Articles of Organization, or Certificate of Organization.
- Create operating agreement
An operating agreement is not a strict requirement but something encouraged when you start an LLC.
- 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 Indiana
If you are wondering How Fast Can I Form an LLC in Indiana, you are not alone. There are a number of different ways you can go about forming your new LLC. In general, LLC creation in Indiana takes from one day to two weeks. The process can take even longer if you decide to file by mail. If you want to minimize the amount of time it takes to form your Indiana LLC, consider using an online business formation service.
While operating agreements are not legally required in Indiana, many people choose to file one in order to ensure accuracy and efficiency. Additionally, operating agreements help the LLC protect its assets during legal disputes, and they also legitimize it to banks, courts, and government agencies. Here are a few ways you can speed up the process. If you don’t have the time to draft an operating agreement, consider using an online service or filing it by mail.
In most cases, you can file articles of organization online with the Indiana Secretary of State. You will need to create an account on the INBiz website to file the form. Online filings take just one hour to complete; mail filings usually take three or four days. The processing time for Indiana LLCs depends on whether you file online or by mail. If you file online, you can expect to receive your LLC within a few hours. When filing by mail, however, the processing time will take about four to five business days.
If you are a resident of Indiana, 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 $95 (domestic LLC) and $105 (foreign LLC), LLC costs in Indiana include $31 for Biennial Reports every 2 years. LLCs are liable to pay sales tax of 7% every year.
It takes 1 hour to get an Indiana LLC if you file it online. For the mail filing, it takes 3 to 4 business days to get an LLC.
Every year all the LLC have to submit an Annual Report and pay $31 every 2 years to the Indiana 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.
LLCs are easier to establish than other business structures. Small businesses, especially start-ups can easily start their LLC in Indiana 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, leave a comment below.