How to Form an LLC From Start to Finish

Forming an LLC takes five steps: a name, a registered agent, the articles, an operating agreement and an EIN. Here is the walk-through.

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Filed 2026-10-18

Learning how to form an LLC is mostly a matter of order. You pick a name. You pick an agent. You file one short document with your state. Then you write down how the company will run and get a tax number from the IRS. The details differ by state, so check with your own Secretary of State as you go.

What an LLC is

The IRS says a Limited Liability Company is a business structure allowed by state statute. That last part matters. Each state creates and shapes these companies, so the rules you follow are your state's rules.

The SBA guide says an LLC lets you take advantage of the benefits of both the corporation and partnership business structures. New York's guide calls it a hybrid. It blends a corporation's limited liability with a partnership's flexibility. The owners are called members rather than shareholders or partners.

On taxes, the SBA guide says LLC profits and losses can get passed through to your personal income without facing corporate taxes. There is a trade-off. Members are treated as self-employed. That means self-employment tax, which funds Medicare and Social Security.

So who is allowed to own an LLC? The IRS says most states do not restrict LLC ownership, so members may include individuals, corporations, other LLCs and foreign entities. The IRS also says most states allow an LLC with a single member, meaning just one owner. So in most states, you can form one by yourself.

A few types of businesses generally cannot be LLCs, such as banks and insurance companies, per the IRS. And the IRS says there are special rules for foreign LLCs.

Step 1: Choose a name for your LLC

Your entity name is how the state identifies a business, per the SBA guide. It also protects a business at the state level. Once you register it, no one else in the state can usually use that name.

Each state may have different rules about entity names and company suffixes, the SBA guide says. Most states do not allow a name already registered by someone else. Some states require an entity name to reflect the kind of business it represents.

The suffix rules vary. New York's guide says an LLC name must include the words "Limited Liability Company" or the abbreviation "LLC" or "L.L.C." The Texas Secretary of State says a limited liability company name must contain "limited liability company," "limited company," or an abbreviation of one. Your state will have its own version of this rule.

Before you settle on a name, search your state's business registry to see if it is taken.

Step 2: Choose a registered agent

Per the SBA guide, an LLC needs a registered agent in its state before it files. So does a corporation, partnership or nonprofit. The agent gets official papers and legal documents for your company.

The agent must be located in the state where you register. Many owners pay a registered agent service to do this job for them. If you want a deeper look, read about an LLC's registered agent. If you are filing in Delaware, there is a guide to Delaware registered agents too.

Step 3: File articles of organization

This is the step that creates the company. New York's guide says organizers form an LLC by filing the Articles of Organization with the Department of State. California's FAQ says a limited liability company is formed by filing Articles of Organization, Form LLC-1. Your state will have its own form and its own filing office.

The document itself is short. The SBA guide calls articles of organization a simple document. It spells out the fundamentals of your company. It lists the basics: the company name, its address, the member names and the registered agent.

Ready to form an LLC online? This site has state guides. See how to form an LLC in California, in New York and in Texas. We also cover how to form an LLC in Florida and how to form an LLC in Colorado. Not sure which state to file in? See where to form an LLC.

Filing costs money and takes time, and both vary a lot by state. See how much it costs to start an LLC, the state filing fee for an LLC and how long it takes to form an LLC.

Step 4: Create an operating agreement

The SBA guide says an operating agreement covers your company's money and how it runs day to day. It sets how big decisions get made. It also sets each member's duties, powers and responsibilities.

New York's guide goes further. It says members must adopt a written Operating Agreement. That document sets the rights, powers, duties, liabilities and obligations of the members. Check whether your state requires one. Even where it does not, the document is worth writing.

The agreement stays in your files. New York's guide says it is an internal document of the LLC and is not filed with the Department of State. California's FAQ says the same. Operating agreements and meeting minutes are not filed with the Secretary of State.

Step 5: Get an EIN

New York's guide says an LLC will need a taxpayer identification number obtainable from the Internal Revenue Service. That number is the EIN. The IRS issues it, and you apply after the state has created your company.

For the application itself, read how to apply for an EIN for an LLC or how to get an EIN number. There is also a page on the IRS EIN and one on forming an LLC and getting a free EIN.

After you form: licenses, taxes and reports

Filing the articles is not the end of the paperwork. New York's guide says some business activities require licenses or permits from state or local governments, or both. For that side of things, see the guide to business licenses.

On taxes, New York's guide says an LLC can choose to be taxed as a corporation or partnership. The SBA guide says an LLC can be taxed as a C corp, S corp, or a nonprofit, though these arrangements are less common. Thinking about that choice? Compare an LLC vs. an LLC taxed as an S corp. Then read up on LLCs and the IRS.

See the guide to the annual LLC report, or the Colorado Periodic Report for that state's version.

Is an LLC the right structure?

New York's guide says forming an LLC should only be done after careful analysis. It also says to think about using a lawyer. But no rule says you must hire one.

Per the SBA guide, LLC or corporation status can protect your personal property if you are sued. The protection only goes so far. California's Franchise Tax Board says LLCs protect members from personal liabilities. You can form one to run a business or to hold assets.

If you are still choosing, compare an S corp vs. an LLC and an LLC vs. a sole proprietorship. The SBA guide also notes that LLCs can have a limited life in many states, which is worth knowing before you commit.