How to Start an LLC in Tennessee

A Tennessee LLC is one of the most simple, cost-effective, and quick business structures to form. Even so, navigating the formation process can seem daunting without clear guidance and an actionable plan.

In this How to Start an LLC in Tennessee guide, we’ll break down everything you need to know to form your LLC, from the steps you’ll need to take to get started to maintaining your structure.

Tennessee LLC

In order to form an LLC in Tennessee, you’ll need to complete the following steps:

1. Name Your Tennessee LLC
2. Pick a Registered Agent
3. Submit Your LLC’s Articles of Organization
4. Create a Tennessee LLC Operating Agreement
5. Get an EIN
6. File Your BOI Report

In the sections below, we’ve broken down each of these steps in more detail.

Step 1: Name Your Tennessee LLC

The first thing you’ll need to do before getting started is picking the right name for your LLC. This is important because your business’s name will need to represent your brand accurately, as well as be as memorable as possible.

In Tennessee, all LLC names need to abide by the following statutory guidelines in order to be accepted by the Secretary of State:

• Your LLC’s name must be distinguishable from all other names registered in the Division of Business Services’ corporate management system. This means that it will need to include unique letters, words, or a sequence different from those of existing corporations, LLCs, partnerships, and reserved or registered names
• Your LLC’s name cannot rely on punctuation, capitalization, or the presence or absence of articles, conjunctions, or prepositions (e.g., “the”, “a”, “and”, “of, etc”) to achieve distinctiveness. Similarly, endings such as “Inc.,” “LLC,” “Corp.,” and similar abbreviations do not make a name distinguishable
• Your LLC’s name must not contain language that implies unauthorized business activities or suggests affiliation with governmental or official bodies without proper certification. Names that include terms like “bank,” “trust,” or “credit union” require prior approval from the Tennessee Department of Financial Institutions

To clarify any further questions on business name registration, you can visit the Tennessee Secretary of State’s Business Name Availability Guidelines.

Keep in mind that even though picking an LLC name in itself has no cost, there are certain fees that can be associated with the overall process.

Reserve an LLC Name

If you’re not yet ready to launch your business and still need a little more time, you can choose to reserve your desired LLC name for up to 120 days by submitting Form SS-9425: Application for Name Reservation along with a $20 filing fee.

If you require more time, you will need to renew your reservation once the initial period expires by following the same process.

Register a DBA Name

Another potential cost associated with naming your LLC is a “doing business as” (or DBA) name — known as an Assumed Name in Tennessee.

This is essentially a nickname that you can choose to register for your business to operate under.

Registering a DBA name can be done by filing an Application for Registration of Assumed Name to the county clerk’s office in the area your business will primarily operate in.

This registration requires a fee of $20, and your DBA name will be secured for a period of five years.

Buy a Domain Name

Finally, you’ll want to focus on securing a good domain name (which is your website’s URL address) for your business. For this, try to focus on choosing one that’s easy for customers to remember, relevant to your business, and accurately reflects your brand.

After confirming the domain name you want to use is actually available, you can purchase it through a trusted registrar.

Step 2: Pick a Registered Agent

The next step you’ll need to take toward forming your LLC is to pick a registered agent.

This is an individual or business entity that accepts legal correspondence on behalf of your business, such as service of process, notice of lawsuits, and official government communications; you’re required to continuously maintain one as long as your LLC is active.

Your registered agent can be an individual or business entity, but will need to satisfy the following requirements:

•  Must be a legal resident of Tennessee or a business authorized to operate in Tennessee
•  Must have a physical address in Tennessee; PO boxes are not acceptable
•  Must be available during normal business hours in order to receive service or process

Keep in mind that you can choose to act as your own registered agent if you’re looking to save money, although this is generally not recommended as it will mean that your home will become publicly available.

Hiring a third-party service is also relatively affordable ($125+ a year), making it a worthwhile investment for most small business owners.

Note: To have a look at some of our other top recommendations, you can also check out our Best Registered Agent Service of 2024 guide.

Step 3: Submit Your LLC’s Articles of Organization

In Tennessee, the Articles of Organization is the filing document that you’ll need to submit with the Secretary of State in order to officially register your LLC.

When completing your LLC’s Articles of Organization, you will need to include the following information:

• LLC Name: You will need to specify the proposed name of your LLC, ensuring it complies with the standards set forth in T.C.A. § 48-249-106
• Consent (If Applicable): If you choose to use a name similar to that of another registered entity, you will need to attach a consent form and include an additional $20 fee
• Business Designations: If applicable, you will need to specify whether any type of special designation will apply to your LLC (e.g., nonprofit LLC, bank, insurance company, professional LLC, etc.)
• Registered Agent and Office: You will need to provide the name and physical address of your LLC initial registered agent in Tennessee
• Fiscal Year Close: You will need to designate the month in which your LLC’s fiscal year will conclude; if not specified, December will be set as your LLC’s default closing month
• Effective Date: If you want your LLC’s formation to commence on a future date, you will be able to request this (cannot exceed 90 days from the filing date)
• Management Structure: You will need to declare whether your LLC will be member-managed, manager-managed, or director-managed
• Member Details: You will need to record the number of members of your LLC at the time of the filing date
• Duration: You will need to indicate whether your LLC has a specific end date or will operate indefinitely

You can submit your LLC’s Articles of Organization in one of the following ways:

• E-file: You can submit online at http://tnbear.tn.gov/NewBiz; keep in mind that credit and debit card payments will incur a small convenience fee
• Mail or In-Person: You can print this form and either mail it with the required fee or deliver it in person to the following address:

Secretary of State’s Office
6th FL – Snodgrass Tower
ATTN: Corporate Filing
312 Rosa L. Parks AVE
Nashville TN 37243

It should be noted that the cost for filing will depend on the number of members in your LLC; you will need to pay a filing fee of $50 per member, with a minimum fee of $300 and a maximum of $3,000.

Step 4: Create a Tennessee LLC Operating Agreement

Once this is completed, the next step you’ll need to take is to create an operating agreement.

This is an internal document that clearly outlines the ownership and management structure of your company in order to reduce potential future conflict.

While this document isn’t legally mandated in Tennessee, all LLCs are recommended to have one as it can help maintain both: smooth operations and your LLC’s corporate veil.

A number of companies provide drafting services for operating agreements online, typically for a fee of around a few hundred dollars. However, it’s quite easy to sort this out by yourself if you want to save money, and you can even find a number of free templates online to help with this.

Step 5: Get an EIN

Even though it’s not a legal requirement (unless your LLC has employees or multiple members), all Tennessee LLCs should apply for an Employer Identification Number (EIN); this is also known as a Federal Tax Identification Number.

This is a free, nine-digit number used by the IRS to identify your business and keep track of its tax reporting — much like a Social Security Number (SSN) for individuals.

You’ll need an EIN to be able to:

• Hire employees
• Open a business bank account
• Apply for some business licenses/permits
• Establish a line of credit

On top of this, using an EIN instead of a Social Security Number (SSN) helps to protect your personal information and safeguard your anonymity as the business owner of your LLC.

You can quickly apply for an EIN for your LLC online through the IRS website. You’re also able to submit a paper application using Form SS-4 either via fax to (855) 641-6935, or by mailing it to the following address:

Internal Revenue Service
Attn: EIN Operation
Cincinnati, OH 45999

Note: Don’t worry if you don’t already have an SSN, it’s not necessary to have one in order to apply for an EIN — instead, you can just leave Section 7b of the application blank and call the IRS on (267) 941-1099.

Step 6: File a BOI Report

Starting January 2024, the vast majority of LLC owners will be required to file a Beneficial Ownership Information (BOI) Report with the US Financial Crimes Enforcement Network (FinCEN).

This is part of an initiative by the U.S. government to stop individuals and entities engaging in illegal or unethical activities from being able to conceal this using “opaque ownership structures”, like shell companies, to hide their true identities.

Existing LLCs will be able to file this report anytime between January 1, 2024, and January 1, 2025, while new LLCs will have up to 90 days after the date they were initially formed to do so (30 days for LLCs formed after the start of 2025).

Keep in mind that failure to file your LLC’s BOI report on time can result in exorbitantly high fines (i.e., $591 per day) or even jail time (up to two years).

Note: Not every LLC owner is required to file a BOI report. For example, companies with more than 20 full-time employees, accounting firms, and banks are exempt. For a full list of filing exemptions, you can have a look at FinCEN’s website.

How to Maintain Your Tennessee LLC

In order to keep operating legally in the state of Tennessee, there are a couple of things you’ll likely need to take care of each year, including:

• Submitting the Annual Report
• Paying the Franchise Tax

Don’t worry if you’re not sure how to complete each of these steps, as we’ve detailed all the information you’ll need to know in the sections below.

Submit the Annual Report

All LLCs in Tennessee are required to submit an Annual Report by the first day of the fourth month following the end of their fiscal year.

This report keeps the Secretary of State informed and up-to-date in relation to key aspects of your business, such as:

• Changes to your LLC’s principal office and/or mailing addresses
• Updates in the name and address of your registered agent
• Changes in your LLC’s officers, directors, members, managers, or partners

The filing fee for the Annual Report is $50 per member, with a minimum fee of $300 and a maximum of $3,000. Any changes to the registered agent or office address will also incur an extra $20 fee.

You can file your LLC’s Annual Report either online through the Tennessee Secretary of State’s website or by downloading the applicable form and mailing it to the Secretary of State’s Office at 6th FL – Snodgrass Tower, ATTN: Corporate Filing, 312 Rosa L. Parks AVE, Nashville, TN 37243.

Paying the Franchise Tax

All LLCs in Tennessee are required to pay a franchise tax each year.

To do this, you will need to file the Franchise and Excise Tax Return with the Tennessee Department of Revenue by the 15th day of the fourth month following the end of your LLC’s fiscal year. The franchise tax rate is 0.25% of either your LLC’s net worth or the value of your LLC’s real and tangible property in Tennessee (whichever is greater).

It should be noted that a minimum franchise tax of $100 is applicable to all LLCs, irrespective of their revenue or operational status.

Tennessee vs Other States

Tennessee stands out as a favorable location for business due to its straightforward and efficient LLC formation process — which attracts entrepreneurs eager to establish their operations quickly.

Having said that, Tennessee’s fee structure ranks it among the more expensive states for both forming and maintaining an LLC, particularly for multi-member entities.

Regardless, keep in mind that the best state to form your LLC is almost always the state that you will be operating in; this is because otherwise you’ll likely be required to register as a foreign LLC in your home state, meaning that you’ll need to pay registration and maintenance fees twice.

Tennessee Secretary of State Contact Information

Mailing Address:
312 Rosa L. Parks Avenue
Snodgrass Tower, 3rd Floor
Nashville, TN 37243
Monday – Friday, 8 a.m. to 4:30 p.m.

Contact Information:

Email: TNSOS.CORPINFO@tn.gov
Phone: (615) 741-2286