Arkansas LLC: Everything You Need to Know
If you are starting a business in Arkansas, establishing a limited liability company (LLC) can legally protect your personal property if your business is sued. 3 min read
How to Start an LLC in Arkansas
If you are starting a business in Arkansas, establishing a limited liability company (LLC) can legally protect your personal property if your business is sued. These assets can include bank accounts, homes, vehicles, and other items of value. An LLC can also be formed to hold valuable assets, including vehicles, aircraft, boats, or real estate.
It costs $50 to form an LLC in Arkansas via mail, or $45 if you pay online. You must register your business with the Secretary of State, pay the fee, fill out required forms (including the Articles of Organization) and meet all other requirements of the agency.
Requirements for Forming an LLC in Arkansas
You can file your paperwork with the Secretary of State either online or by mail. You can also file in person and the office will form the LLC while you wait. Paperwork must include:
- The name and address of your business
- Your name and contact information of the registered agent
- Whether the LLC will be managed by members or by a manager
- The execution date of the LLC (if this is different than the filing date)
- Your name and signature
Once your paperwork is received, the process takes two to three business days for an online filing, and two to three weeks for a filing via postal mail.
Choosing a Name for Your LLC in Arkansas
According to Arkansas's legal LLC naming guidelines, your business name must include "Limited Liability Company" or the abbreviation LLC. In addition to your Articles of Organization, you'll need to file an Application for Reservation of Corporate Name with the office of the Secretary of State, either online, by mail, or in person.
Start by searching for business names on the state website so you don't choose a name that's already taken. Some words cannot be used in the name of your LLC. For example, you cannot use words that suggest that your business is part of a state or federal agency. Certain words in the business name require additional paperwork and information. If you use words such as attorney or medicine, you must have a licensed individual such as a lawyer or doctor as party of your business entity.
Once you've decided on a name, purchase the domain name and set up an email address so that you'll be able to use it for your business.
Choosing a Registered Agent
Arkansas requires your LLC to have a registered agent. This person or business will be responsible for sending and receiving legal communications and state filing as a representative of your LLC. The registered agent must live or transact business in the state of Arkansas. You can serve as the registered agent for your own LLC.
Creating an Operating Agreement
Arkansas does not legally require an operating agreement for an LLC, but it makes sense to have one in place if your LLC has more than one member. This agreement details the ownership and procedures of the business. These are recognized as legally binding governing documents by the state.
Obtaining an EIN
The Employer Identification Number (EIN) is your company's identifying number. Think of it as a social security number for business. It is also called the Federal Tax ID number. You'll need this number to file your taxes, and it might be required by some banks if you want to open a business checking account.
You can request a free EIN directly from the IRS either online or via postal mail. An EIN is legally required if your LLC has two or more members.
Key Steps After Forming a Business
It's important to separate your personal assets from business assets by creating a business bank account. A business credit card will help you separate expenses as well as build a credit history for your LLC. Both these steps are critical for accounting and tax purposes.
If your LLC employs Arkansas workers, you must contact the Arkansas Department of Workforce Services to register for unemployment insurance tax and arrange for employee withholding tax through the Arkansas Taxpayer Access Point. If you are selling goods or services that can be taxed, you must register for that through the Taxpayer Access Point as well.
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