Setup LLC in Utah: Everything You Need to Know
Set up LLC in Utah refers to the process that begins by understanding what a limited liability company is and whether it is the right business structure for your Utah company.3 min read
Set up LLC in Utah refers to the process that begins by understanding what a limited liability company is and whether it is the right business structure for your Utah company. The first step is identifying an appropriate business idea that encompasses your vision. The next step is to analyze the idea with an open mind then create a business plan. Once these steps are finalized you can begin forming your LLC.
Information for Starting an LLC
- A limited liability company (LLC) protects its owners, who are also members, from potential litigation and from financial obligations.
- Limited liability companies are flexible, as they do not have as many requirements as a corporation. For example, corporations are required to hold annual meetings while LLCs are not.
- An LLC provides simplified taxation.
- Applying for an LLC is an easy process. The application can be filled out online and takes about 15 minutes.
- Although the application is straightforward, if you have any concerns, it's best to consult with an attorney.
Steps for Forming an LLC
Naming the LLC is the first step. Choose a name that suits the purpose of the business and one that can be easily found by clients when doing a search.
- Follow the naming guidelines for the state. This includes making the name distinguishable from other businesses by using a key or specific word.
- The business name must contain LLC, Limited Liability Company, or L.L.C.
- Restricted terms such as "attorney", "university", or "bank" require additional paperwork to be filed to gain permission to use these words. It is possible a licensed person, such as a doctor or lawyer, would need to be part of the LLC if these titles are used in the business name.
- There are prohibited words that cannot be used such as "Treasury", "Secret Service", and "FBI" as they would be confusing to the public.
- The name cannot be in use by another business. To ensure the name is available, use the search option at the State of Utah website.
- By filing an Application for Reservation of Business Name, you can reserve the name for 120 days.
2. Registered Agent
- You must have a registered agent for your LLC. This is a person or a business that receives legal paperwork on behalf of the LLC.
- The agent must be a Utah resident, or the corporation named as registered agent must be authorized to do business in the state.
- A registered agent must have a physical street address within the state.
3. Certificate of Organization
- Next, you need to file a Certificate of Organization with the Utah Division of Corporations. You must file the necessary forms, meet all the requirements for forming an LLC, and pay the filing fee. You can file online or download the form from the Division website.
- There is specific information you must provide. This includes the name of the LLC; the purpose of the business; the type of management, which will be either manager-managed or member-managed; duration of the business; organizer's name, address, and signature. If you plan to close the LLC at a future date, you can include this, but it is not required. The form can be mailed, emailed, faxed, or delivered in person. The filing fee is currently $70. The processing time can take seven to 10 business days.
4. Operating Agreement
- Draw up an operating agreement that all members agree to. While not a requirement to have an agreement in Utah, this step is strongly advised.
- The operating agreement serves as a legal document that outlines the policies and operating procedures of the LLC and its ownership.
5. Employer Identification Number
- If your LLC has employees or you elect to be taxed as a corporation, you will need to obtain an Employer Identification Number (EIN). You must also have the EIN assigned by the Internal Revenue Service if there is more than one member but no employees.
Things to Do After Formation
- Acquire any permits or business licenses required by the state, register for state taxes, and open a separate bank account for business.
- Build a website for your LLC to develop and promote your brand.
- Open a business bank account.
- Get a business credit card.
- Register for Utah State Tax if your LLC will be selling goods.
- Register for Employee Withholding Tax and Unemployment Insurance Tax if your LLC has or will have employees.
- Set up an accounting system.
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