How to Start an LLC in 2026: A Complete Step-by-Step Guide

Starting a Limited Liability Company (LLC) is one of the best decisions you can make for your small business. An LLC combines the liability protection of a corporation with the simplicity and tax advantages of a partnership.

Why Form an LLC?

• Personal asset protection — Your personal savings, home, and car are protected from business debts
• Pass-through taxation — Profits pass directly to your personal tax return, avoiding double taxation
• Credibility — "LLC" after your name signals legitimacy to clients and partners
• Flexible management — No board of directors required; manage it yourself or with partners

Step 1: Choose Your State

Most small businesses should form their LLC in their home state. While Delaware and Wyoming are popular for large corporations, they make less sense for a small local business that will also need to register as a "foreign LLC" in your home state anyway — costing you double fees.

Step 2: Choose a Business Name

Your LLC name must:

• Include "LLC," "L.L.C.," or "Limited Liability Company"
• Be unique in your state (check your state's business search tool)
• Not include restricted words (Bank, Insurance, Attorney, etc.)

Step 3: File Articles of Organization

File with your state's Secretary of State office. This typically costs $50-$500 depending on the state.

Information needed:

• Business name and address
• Registered agent name and address
• Member names (owners)
• Business purpose

Step 4: Get an EIN (Employer Identification Number)

An EIN is your business's Social Security Number — required for:

• Opening a business bank account
• Filing business taxes
• Hiring employees

The IRS issues EINs for free via their website. You can also use our EIN Filing Service to handle it for $49.

Step 5: Create an Operating Agreement

While not always legally required, an Operating Agreement is essential. It defines:

• Member ownership percentages
• Profit distribution
• Decision-making procedures
• What happens if a member leaves

Step 6: Open a Business Bank Account

Never mix personal and business finances. Open a dedicated business checking account immediately after forming your LLC.

Costs Summary

| Item | Typical Cost | |------|-------------| | State filing fee | $50-$500 | | Registered agent (1st year) | $0-$150 | | EIN (self-file) | Free | | EIN (via our service) | $49 | | Operating Agreement | Free with template | | Total | $50-$700 |

Disclaimer

State laws vary significantly. This guide provides general information. Consult a business attorney for advice specific to your situation.