How to Start an LLC in Idaho
Updated: July 20, 2021|
Updated: July 20, 2021|
If you’re starting a business in Idaho, the first step you’ll need to take is to form an Idaho LLC. An Idaho LLC will separate and protect your personal assets (that’s what the “limited liability” in limited liability company means). It will also legitimize your business in the eyes of your potential customers.
This article will walk you through all the steps required to form your Idaho LLC and get your business started on the right foot. Be sure to bookmark this page, as the process may take you a few days from start to finish.
Forming an LLC in Idaho on your own doesn’t have to be difficult. Just follow these simple steps below and your new business will be up and running in no time!
The first step to forming an Idaho LLC is to choose a name for your business. Deciding on the perfect name for your new business is one of the most crucial parts of starting a company. Choosing a name that’s easy to remember and stands out in search engine results will help you get more customers, which means more revenue, which leads to more growth!
When choosing a name, there are a few searches that you need to complete before you settle on the final option:
The Idaho Secretary of State has a few rules when it comes to naming LLCs:
To see the actual statutes and regulations governing the Idaho Limited Liability Company naming process, see the Idaho State Statute page.
It’s worth noting that you should be fairly certain that the name you select is the name you are going to stick with. Changing an LLC’s name isn’t impossible, but there are a lot of headaches and fees associated with the process.
If down the road, you do decide that your LLC’s name no longer serves the branding of your business, a simple solution would be to create an assumed name (also known as a DBA). An assumed name allows you to keep your LLC name the same and operate under a trade name different from the LLC’s.
Once you’ve decided on a name that follows all of the guidelines above, move on to the next step.
The Idaho Secretary of State requires all LLCs to appoint a registered agent.
A registered agent is a person or entity that is assigned to receive tax forms, legal documents, official notices, and any other documents or correspondence from the government on your business’s behalf. This person can be yourself, a friend or family member, another member of your business, or a hired registered agent service.
In order to act as a registered agent, the person or entity must:
The registered agent will be assigned on the Certificate of Organization when filed. For more information, visit the Idaho Registered Agent Information page.
Our recommended company, ZenBusiness offers a year of their registered agent service for free when you use them to form your LLC ($39 + state fees). After that, it’s only $119/year.
A common question is whether or not you should “be your own registered agent”. Taking this position for your business is absolutely possible, but there are some downsides that you should think about before making this decision.
The first and most important downside in acting as your own agent is that you lose any anonymity that your LLC would have provided you. Since your LLC formation is a public record, this means that your name, address, and any other contact information will be available for anyone to see. This generally results in lots of junk mail, solicitations, and possibly even unwanted visitors at your home address.
The second issue is a bit less common but just as important for some folks. If you don’t have a physical address in Idaho, then you won’t be able to file for an LLC. This affects non-residents or those trying to form a foreign llc.
Fortunately, using a registered agent service solves all of these issues at a very low cost. These service providers hold a physical office in each state and make the process simple for small businesses.
After choosing your registered agent, the next step is to file the LLC Certificate of Organization with the Idaho Secretary of State. This is the document that actually forms your LLC as a separate legal entity.
With your application, you’ll need to pay the Idaho LLC Filing Fee: $100 (base filing fee) – $120 by mail or in-person with manual processing.
The simplest way to file this document is online with the Idaho SOSBiz portal. You’ll need to create an account using the name of your business, an active email address, and a credit card that you’ll use to complete your purchase.
If you don’t want to use the online system, you can also apply by mail or in person. If you choose this option, you’ll need to download the Idaho Certificate of Organization Form and fill out the document completely and accurately. Mail your copy and a check or money order for the $100 to $120 fee to:
Office of the Secretary of State
450 N 4th St.
P.O. Box 83720
Boise, ID 83720-0080
Once you’ve filed your Certificate of Organization, your next task is to complete your Idaho LLC Operating Agreement.
A Limited Liability Company Operating Agreement is a governing document that lays out the inner workings of your business’s structure. Think of this document as something similar to a prenup, except a lot simpler and less expensive. It will protect the interests of all parties involved in the case of any sort of trouble in the future.
There are six articles in a standard Operating Agreement:
In Idaho, you don’t need to file your operating agreement with the state, but this doesn’t mean that you should skip this step. If you don’t have this document in place and something happens to you or another member, it’s possible that the state could step in to settle any disputes. It’s better to have everything lined up at the beginning, rather than wait until it’s too late.
If your business needs an Idaho Sales Tax License to operate, you will be required to submit your operating agreement in that application. More about tax licenses later.
The last formation step for your business is to get an EIN (Employee Identification Number). An EIN is essentially like a social security number for your LLC. The IRS issues EINs and will use it to keep track of your business’s tax reporting.
The main reasons that you’ll need an EIN are:
To get your EIN, head to the IRS EIN Assistant and fill out the form. One of the requirements to obtain an EIN for your business is that you’ll need to enter either your personal Social Security number (SSN) or Individual Taxpayer Identification Number (ITIN). If you don’t have either of these, then you’ll need to jump through a few more hoops to get your EIN.
First off, congratulations on forming your LLC! Taking this first big step shows that you are serious about your new business and shows its legitimacy to the rest of the world!
Now that your LLC is formed and you have a separate legal business entity, you’ll need to take care of a few more things before you start selling.
The main job of an LLC is to separate the business’s assets from you, the business owner’s personal assets. This separation is called the corporate veil. Essentially, it ensures that if your business is ever sued or has any other financial debts that your personal assets are sheltered from these liabilities. This is where the “limited liability” in LLC comes from.
The easiest way to break your corporate veil is to mix your personal bank account with your business’s. This mixing of funds is called commingling. This opens your personal bank account up to undue exposure and completely breaks the asset protection that your LLC was meant to provide.
The good news is that avoiding this danger is extremely simple. Open a business bank account using your EIN number, transfer in any initial funds (keep a record of this transfer), and do your best to never cross personal and business funds in the future.
If you ever need to take money out of the business or invest more of your personal funds in just be sure to keep records of these transactions. This includes the transfers you make when paying yourself a “salary”.
No matter what type of business you operate, you need a website in order for your customers to take you seriously. Almost all businesses transactions today start with an online search, so if you aren’t there to be found then your customers will find your competition. It’s that simple.
Luckily, it’s gotten a lot simpler to build and maintain a website on your own without any prior experience or knowledge of data science or code. Drag-and-drop website builders have improved to the point that anyone can get their business online with about a day’s work.
Certain businesses will need to apply for an Idaho State Sales Tax Permit. The filing of sales and use tax is administered by the Idaho State Tax Commission. Not all businesses are required to register for sales tax, but if your Idaho-based business engages in any of the following, then you will need to apply:
When starting a business, there are often several licenses and permits required before transactions can begin. Which licenses you need will depend greatly on the type of business you plan to operate and the location.
Finding the specific licenses and permits your business needs to operate will start with a few simple searches. To get started, you’ll need to quickly search the websites of:
Once you’ve identified the different location-based permits, you’ll need to acquire any licenses required by your industry. This includes licenses like the Idaho real estate license, the Idaho insurance license, the Idaho liquor license, and so on.
Once you’re up and running, it’s important to have the proper insurance policies in place for your Idaho business. Some coverages will be required by the state if you have employees, while others will be required by landlords. Others still are “optional” but widely accepted due to their protective nature.
A few of the most common business insurance policies are:
Idaho requires LLCs to file annual reports with the Secretary of State. This can be done online through the Idaho SOSBiz portal. The report is due at the end of every month in which the company was formed.
This report can be quite complicated depending on your business operations, so we recommend working with a licensed CPA to ensure you are filing correctly.
The filing fee for Idaho LLCs is $100. Using a recommended LLC filing service like ZenBusiness starts at $39 + state fees.
The general filing time for Idaho LLCs takes 7 – 10 business days but can be expedited with an additional fee.
No. When filing an LLC in Idaho there is a $100 filing fee for all applicants.
While there is no state income tax or personal income tax in Idaho, there are several other Taxes that your LLC may encounter. We recommend speaking with a licensed tax professional to ensure you are filing and paying the proper taxes.
The cheapest way to get an LLC in Idaho is to follow the steps above and file yourself. There is an LLC filing fee of $100, but this is required whether you file on your own or use an LLC filing service.
Yes. See above for more information.
LLCs in Idaho don’t “expire” but they can be dissolved. If you fail to file annual reports, then your LLC may be subject to fines and fees. Over time, this could lead to an “automatic dissolution.” You can file the Idaho LLC Statement of Dissolution to voluntarily dissolve your LLC.
We recommend working with a professional registered agent service who will inform you of upcoming reports and even help you file them.
Idaho Secretary of State
PO Box 83720
Boise, ID 83720-0080
Idaho Secretary of State
450 North 4th Street
Boise, ID 83720-0080
Monday – Friday, 8 a.m. – 5 p.m.
Email: Idaho SOSBiz portal
Phone: (208) 334-2301
Information on this page is not to be considered legal or tax advice. Data was gathered from a multitude of sources and most recently updated in July 2021.
Any Information on this site is not guaranteed or warranted to be correct, accurate, or up to date. StateRequirement and its members and affiliates are not responsible for any losses, monetary or otherwise. StateRequirement is not affiliated with any state, government, or licensing body. For more information, please contact your state's authority on insurance.
When readers purchase services discussed on our site, we often earn affiliate commissions that support our work. Learn More