How to Start an LLC in Iowa: If you’re interested in setting up an LLC in Iowa, 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. Iowa laws make it easy to establish your LLC in Iowa. On this page, You’ll find all the steps that must be taken to ensure that your Iowa 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 Iowa
- After Starting Your Iowa LLC
- Iowa Foreign LLC
- Iowa LLC Formation Review
How to Start an LLC in Iowa
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 Iowa, 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 Iowa. The following steps explain everything you need to create your LLC in Iowa in 2022. Let’s get started!
Step 1: Decide a Name for Your Iowa LLC
The very first step while forming an LLC in Iowa 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.
Iowa LLC Naming Guidelines
There are a few specific requirements all the LLCs in Iowa 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 Iowa 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 Iowa 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 –|
|Iowa Business Entity Search – Online Search|
Name Reservation Form – PDF
Name Reservation Form – Online
Iowa LLC Name Search – Instructions
|Secretary of State|
Business Services Division Lucas Building, 1st Floor
Des Moines, Iowa 50319
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 $10 to reserve your name with the Iowa 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 Iowa Secretary of State by submitting a Fictitious Name Resolution Form in Iowa along with the filing fee of $7 for the first page and $5 for each additional page after the first page.
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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 Iowa
The second step to forming an Iowa 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 Iowa. Hence, hiring a competent Iowa Registered Agent for your LLC is necessary.
Make sure your registered agent is a resident of Iowa or has a physical street address. Their business address or the principal address should be in Iowa. 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 Iowa. Some LLC formation services offer standalone Iowa 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 Iowa 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 Iowa 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 Iowa.
Registered Agent Consent Application
In Iowa, there is no need to submit a separate Consent Letter to the Secretary of State. At the time of change of Registered Agent (or the name or address), the new Registered Agent has to sign the consent letter. It comes with the Application form to Change the Registered Agent. Also, if not with the Change form, the agent can separately write a consent letter and submit it along with the change of registered agent form. The filing fee of $5 should be paid for it. For more information on the same, read our guide on Iowa Registered Agent.
Step 3: File Certificate of Organization in Iowa
The third and most important step in forming an Iowa LLC is to file the Certificate of Organization. This Iowa Certificate of Organization is a legal document needed to officially register your business with the Secretary of State. It costs $50 (by mail and online) to file your formation certificate in Iowa. (Read more on LLC cost in Iowa).
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 Iowa LLC, one should know about the rules and regulations thoroughly. Also if you are expanding your existing business (an LLC) to Iowa then you need to register as an Iowa 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 “log in to Subscribe Account” option and log in with your credentials. If you’re not subscribed, then you need to create a new account by clicking on the “Sign-up” button below. Read more about the Iowa Certificate of Organization for online registration.
How to File by Mail
If you prefer filing real-life forms for your Iowa LLC registration, then you can download Domestic LLC Formation Form. Read the form thoroughly, fill it out, and mail it to the following address.
Lucas State Office Building
321 E 12th St
Des Moines, IA 50319
Fax: (515) 242-5953
Point to Note: In Iowa, there is no direct way to file your LLC by mail or Fax. To do so, one has to follow the guidelines.
Processing Time: It takes around 2 weeks to form an LLC in Iowa if filing by mail or fax, for the online filings it starts processing immediately. By paying an additional fee, it can be expedited.
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Step 4: Create Your Iowa 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 an Iowa 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 Iowa, 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 Iowa LLC later. Hence, having an operating agreement may not be necessary but it is definitely ideal.
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Step 5: Filing an Iowa 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 Iowa LLC requires following specific rules and regulations. On the other side, EIN for Iowa 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
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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 Iowa 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 Iowa 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 Iowa business permits & licenses
- Get general liability insurance and professional liability insurance with coverage for employees
- File an Iowa 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 Iowa LLC
Forming an LLC in Iowa is no doubt more cost-effective than other structures of a business. There are some fees and charges one has to bear to form an Iowa LLC. LLCs have pass-through taxation. Hence, your Iowa 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 Iowa,
|Fees/Tax||Amount to be Paid|
|Name Reservation Fee (online and by mail)||$10|
|Certificate of Organization Fee||$50 (by mail and online)|
|LLC Biennial Fee||$60|
In Iowa, 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 1 year without registering your LLC. It can be done by paying $10.
In Iowa, an Annual Report has to be produced every year. It costs $60. Also, the State of Iowa requires the Business Tax each year. The amount is paid at the rate of 12% of the LLC revenue. Read our guide on LLC costs in Iowa for more information.
Iowa Foreign LLC
If you are interested in forming a Foreign LLC in Iowa then you need to file the Certificate of Foreign LLC to the Iowa 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 Iowa SOS to form your foreign LLC in Iowa. To know more in detail, check out our guide on Iowa Foreign LLC.
Reasons to Start an LLC in Iowa
Iowa has the biggest industry of advanced manufacturing units. Around $28,000+ billion is contributed by the advanced manufacturing businesses in Iowa, as reported by the Bureau of Economic Analysis in 2016. Iowa is one business-friendly state in the USA.
Tax Filing Become Easy In Iowa LLC
Starting an LLC in Iowa is beneficial because of the tax filing structure it has. It is easy and consumes less time for the LLCs. This leads to saving some time for the entrepreneurs. The filing fee is also less here. Not just the tax filing if you will look up at the management and the administrative tasks of an Iowa LLC, they are also easy to work on.
Moreover, it is hassle-free to set up all the rules and regulations necessary to run the businesses efficiently. Due to these swift procedures, the business-minded people start calculating the time they save and decide to Start an LLC in Iowa.
International Trade Assistance For LLC
International trading is a dream of businesses that are new in the field and are trying to increase the boundaries of their business. If you are moving to Iowa, then you should know that there is a program in which the government provides international trade assistance to some businesses. For that, one needs to show their authority and prove that they actually deserve this.
Flexible Distribution In Iowa
In many states starting up an LLC with a member, partners abide a person that they have to distribute the profits of the LLC equally. But in Iowa, this rule is changed. The member can take the decision to divide the profits among the partners in whatever way they want.
Economic Development Set Aside Assistance
If a person is looking forward to starting a small-sized business, then the government becomes a helping hand for them and helps them achieve growth. Under this program, if the small and medium-sized businesses can increase job and employment opportunities then they will receive financial assistance from the government.
The only condition is that a person has to clear the expectation bar that the government has set. Only some innovative start-ups will get this help under which they can receive an incentive of up to $1 million.
Other Tax Incentives
There are some other business tax credits available in Iowa. High-Quality Jobs, New Job Creation, Redevelopment programs, Research Activities, Equipment, Computer & Industrial Machinery programs, and some more programs are available. The qualified LLC can enjoy long-lasting benefits from these tax credit programs. Read more on Iowa’s classification of LLC tax.
Top Businesses in Iowa
When an entrepreneur wants to Start an LLC in Iowa, then you should know the best business industries in Iowa. There are some specific businesses to which the state is providing an excellent environment. The list of businesses is mentioned below in detail.
Facts show that Iowa is number 1 in the United States of America regarding ethanol and biodiesel production. The reason behind this is the waste product of agriculture is utilized better with rising and modern technologies. Due to this, high-quality fuel is produced. Due to the increase in demand for biofuel in every sector, more businesses need more businesses to cater to the needs.
Value-Added Food Manufacturing
The state of Iowa is known for supplying 1/14th of the total food consumed in the USA every day. More people depend on the food that is produced in the state due to the quality. That is why the manufacturing and conversion of raw material from agricultural fields to processed, packed food is on the rise in the state. From beef to dairy and from poultry to food ingredients, the value addition in every material is done and then sold in the market.
The companies present in the state have doubled in the past 7 years, showing how profitable this business can be.
The state of Iowa is benefitted from its geographical location. They are located in the mid due to which the demand for a warehouse in the state is more. The total sales that Iowa warehouse has made in a year are $5 billion. The state allows catering to be national and international products and transports and earn money by providing them warehouses.
Here are some small budget high-profit business ideas specifically designed for Iowa State
- App Development Business
- Food Truck Business
- Blogging in Specific Niches
- Bakery Business
Iowa LLC Formation Review
Time needed: 5 minutes.
Just to recap, here are the easy steps again when forming an LLC in Iowa. Click on the steps in this list to read the full detail.
- Name your Iowa 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 Iowa, 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 Iowa. 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 Iowa 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 Iowa
Filing for LLC in Iowa through mail can take up to 2 weeks of time. Online filings are generally completed in 1 business day, hence there is no option to speed up the process.
In order to be legally recognized in Iowa, you must create a Certificate of Organization. There are several sections that you need to fill out. Initial Registered Office Address is the physical address where your business records are stored. It is important that you note that a P.O. Box is not an acceptable address for an initial registered office address. Effective Date can be up to 90 days in the future. You can submit your Certificate of Organization online, by fax or mail.
PLLC owners must create an operating agreement. Even if you don’t need to file it with the state, you need to have one. This document will be used by future bank account applicants, potential business partners, or managing members. It will serve as an overall plan of how you will run your business. Ultimately, your Operating Agreement will determine whether or not you want to keep your LLC in business or dissolve it in the future.
LLCs in Iowa can be formed in one business day using an online filing service like TotalLegal. Once you’ve completed the process, you can download your Certificate of Organization. However, you should remember that the state requires you to file biennial reports every even-numbered year. You will need to pay a fee for this, and you should account for this time as well. Ultimately, LLCs aren’t set in stone. However, if you’re willing to wait a little longer, you should consider filing online.
In order to be fully licensed to run your business, you must obtain an EIN (Employer Identification Number). This number is needed for tax purposes. You can apply for an EIN from the IRS or any state-issued agency. In addition, it’s easy to change the Registered Agent or office. Changing these two details can cost you $50. After obtaining your EIN, there are several tasks you need to complete before you start your business. While these tasks may seem like extra work, they’re essential for the success of your company.
While you’ll need to choose a name for your company, there are some general guidelines you need to follow to avoid conflict of interest. Your LLC name must be easy to remember and available in the state you want to form. It should also not be the same as any other business name in the state. To check if your name is available, you can perform a name search on the website of the Secretary of State. Once approved, your LLC will be recognized as a legal entity.
Another requirement that you need to comply with is filing annual reports. Failure to file an annual report may result in the LLC being administratively dissolved. If you fail to meet these requirements, you may be faced with hefty fines or even dissolution of the LLC. In such situations, you may want to hire a registered agent service. These services will notify you of upcoming deadlines, and will also file the annual reports on your behalf.
If you are a resident of Iowa, 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 $100 (foreign LLC), LLC costs in Iowa include $60 for Biennial Reports every 2 years. LLCs are liable to pay sales tax of 6% every year.
It takes no time (immediate) to get an LLC in Iowa if you file it online. For the mail filing, it takes up to 14 business days to get an LLC. 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 $60 every 2 years to the Iowa Secretary of State and renew the LLC. It is mandatory to renew your LLC every year.
LLCs are easier to establish than other business structures. Small businesses, especially start-ups can easily start an LLC in Iowa 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.