Form an LLC in Utah: Everything You Need to Know
If you are planning to form an LLC in Utah, it is important to take the correct steps. Here is what you need to know.3 min read
Form an LLC in Utah
If you are planning to form an LLC in Utah, it is important to take the correct steps. Here is what you need to know.
Forming an LLC Overview
If you have never formed an LLC before, it is important to understand the basics. Being a popular and common business structure, LLCs are affordable to form, offer flexibility to its owners, and are easy to operate. When you form an LLC, this will mean that you have legally established the business. In addition, you will benefit from tax flexibility while reducing personal liability.
Once you form an LLC in Utah, the company will be governed by the Utah Code — Title 48, Chapter 02c. This is known as the Utah Revised Limited Liability Company Act. In comparison to a partnership, an LLC benefits in the following ways:
- Members are not personally liable for the company. This means that if there are issues with your LLC, your personal finances will not be held responsible.
- An LLC does not yield as many requirements as a corporation.
Forming an LLC in Utah
To form an LLC in Utah, please be mindful of the following steps:
- Check name availability — This will be your LLC's legal name. It must be unique and should not be confused with any other name that is currently registered. To check name availability, conduct a search on the state's website. If you would like, you can reserve your desired name.
- Select a competent registered agent — Please identify your LLC's Utah Registered Agent. This individual should be someone who is expected to be with the company long-term and should also be a resident of Utah. For this step legal counsel is recommended.
- File Utah articles of organization — This will create the limited liability company. Also referred to as a "Certificate of Organization" — this document will be filed with the Utah Department of Commerce - Division of Corporations. Standard processing time is seven to 10 business days.
- Organize company records — Your articles of organization will be the first document to include in your LLC records. You will then generate a number of other records, including your operating agreement, meeting minutes, and the LLC's Employer Identification Number (EIN).
- Create a clear operating agreement — Create an operating agreement for your LLC. This will define all formalities in terms of the LLC's operations. It is recommended that a legal professional review this document in order to protect the owner(s).
- Schedule an organizational meeting — The first members meeting is known as the organizational meeting. The articles of organization and the operating agreement will be required at this point.
- Obtain a federal employer identification number also known as an (EIN) — If your LCC has multiple members or you plan to hire employees, you must seek an EIN. This will also often be a requirement when opening a business bank account. This nine-digit number will be assigned by the IRS which will be used to identify taxpayers. File Form SS-4 with the IRS via mail, fax, phone, or online. No fee is required.
- Get Utah state identification numbers — To do so, please submit Form TC-69: Utah State Business and Tax Registration.
- Consider C-Corp or S-Corp tax treatment — An LLC benefits from pass-through taxation by default. When electing S-Corp tax treatment, this can help owner-employees save on self-employment taxes. In comparison, C-Corps suffer double taxation.
- Apply for all business licenses and permits — To legally run your business, you must obtain all required licenses and permits. To support your efforts, use the Small Business Administration Business License and Permit tool.
- File ongoing tax returns — In order to maintain your company, you must file state and federal tax returns. You should also file a Utah Annual Report.
- Become familiar with your LLC's legal obligations — This is particularly the case for annual renewals. These renewals are due annually, either one or before the anniversary of LLC formation. A $15 filing fee will be applied.
Please note that when you form an LLC in Utah, this process will cost $70. This is the articles of organization filing fee and will take approximately two weeks to be processed. If you would like this service expedited, it will cost an additional $75. When filing online, expedited processing is 24 hours, and when filing via mail, this service takes 1-2 business days.
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