A limited liability company (LLC) offers liability protection and tax advantages, among other benefits for small businesses.
LLC formation in Alaska is easy. Just follow these eight steps, and you'll be on your way.
1. Name Your Alaska LLC
You'll need to choose a name to include in your articles before you can register your LLC.
Names must comply with Alaska's naming requirements. The following are the most important requirements to keep in mind:
- Your business name must include the words Limited Liability Company, LLC, L.L.C., Ltd. Liability Co., Ltd. Liability Company, or Limited Liability Co.
- Your name must be different from an existing business in the state. Searches can be conducted on the Secretary of State's website to determine if a particular business name is in use. For name availability in Alaska, check this link.
- The business name cannot contain words used to name a government agency (i.e., State Department, CIA, FBI, Treasury, etc.)
- In Alaska, the LLC cannot contain the following: city, borough, or village.
- Certain restricted words (bank, lawyer, attorney, credit union, etc.) may require additional documentation and licensure paperwork.
See a complete listing of Alaska's naming rules.
- URL availability. Even if you don't think you'll need a webpage, you probably will. At the very least, you should reserve the option of having one in the future by buying your domain name now. Before finalizing your LLC name, it's a good idea to check if the URL is available.
- Reserve your name. If you aren't ready to register your LLC but are concerned your name might be taken by someone else, you can reserve it for a small fee. In Alaska, names may be reserved for up to 120 days by paying the fee and submitting the proper form to the state authority.
2. Choose Your Registered Agent
Alaska requires you to appoint a registered agent for your LLC.
A registered agent is the LLC's official contact. This is the person or entity who will receive legal documents, government correspondence, tax forms, as well as notice of lawsuits on the LLC's behalf.
A registered agent can be a person (including yourself or an employee of your LLC) or an entity that offers a registered agent service. They must meet the following criteria:
- Entities (or companies) must provide registered agent services.
- The agent must have an address in Alaska.
- The agent must be on-site and available to accept documents during regular business hours.
3. Determine your NAICS Code
NAICS (North American Industry Classification System) is a six-digit number that classifies and categorizes the type of business activities performed by your Alaska LLC. This information may be used in reporting statistical data for each of the industries in the U.S. You may need this number to file annual tax returns. Here is a quick reference guide to identify your NAICS Code in Alaska.
4. Prepare and File Articles of Organization
The Articles of Organization is a document that officially establishes your LLC by laying out basic information about it.
Prepare Articles of Organization and file them with the State of Alaska Corporations Section to register your Alaska LLC properly. Though it sounds like a big job, that means filling out a relatively simple online form and submitting it. You can also send it by mail, but filing online is encouraged.
To prepare your articles, you'll usually need the following information:
- Your LLC name.
- The name and address of your registered agent.
- A reason why you formed the LLC. This can be a general statement.
- An LLC's duration or time period over which the LLC will exist. In most cases, LLCs are perpetual, meaning the duration is indefinite. A perpetual LLC can be dissolved voluntarily or involuntarily. If your LLC exists for a purpose that will end at a specified date, you will specify that date here.
- Management structure: Will its members or managers manage the LLC?
- The person forming the LLC is required to sign the Articles.
Once you file your Articles, the secretary of state will review the filing. If the articles are approved, the LLC becomes a legal business entity.
5. Receive a Certificate From the State
Alaska will issue a certificate that confirms the LLC formally exists after the LLC's formation documents are filed and approved.
If you filed your Articles via mail, the approval time is 10-15 business days. The Alaska Secretary of State will return the stamped and approved Articles of Organization and a Certificate of Organization via regular mail.
If you filed online, the approval time is immediate, but you won't receive anything via mail. To view and print a copy of the stamped and approved Articles of Organization and your Certificate of Organization, search for your LLC's record in the state's online database under "Filed Documents" in the Alaska Division of Corporations: Search Corporations Database.
This certificate will allow the LLC to obtain an Employer Identification Number (EIN), business licenses, and open a business bank account.
6. Obtain an Alaska Business License
For an LLC to do business in Alaska, you are required to get a license. You can obtain the license from the Division of Corporations, Business and Professional Licensing, Occupational Licensing Section. The license expires every year on December 31. You can renew it by paying an annual fee.
7. Create an Operating Agreement
An operating agreement is a document that outlines the way your LLC will conduct business. Alaska does not require an LLC to create an operating agreement.
Although Alaska doesn't require one, a readily accessible, written operating agreement is essential for various reasons, including settling disputes that may arise over financial agreements and other potential litigation. Without an agreement in place, the courts make determinations based on state law, not necessarily what is in the best interest of the LLC and its members.
The operating agreement can include, but is not limited to, the following:
- LLC's name and principal address
- Duration of the LLC
- Name and address of the registered agent
- Information about the Articles of Organization
- Purpose of the business
- Members and their contribution
- The way profits and losses will be divided
- Procedure for admitting new members, as well as outgoing members
- Management of the LLC
- Indemnification and liability clauses
8. Get an Employer Identification Number
The nine-digit Employer Identification Number (EIN) is assigned by the Internal Revenue Service to identify your LLC for taxes. You can obtain your EIN by mail or online through the IRS.
The purpose of an EIN is to assist with the following:
- File and manage taxes at the state and federal level
- Open a business bank account.
- Hire employees.
Registering your LLC gives you a legal foundation to conduct business. Plan to keep your LLC compliant and in active status on the Alaska state website.
After an LLC is organized, it is your responsibility to file an Initial Report with the State of Alaska Division of Corporations within six months of your LLC's organization. The Initial Report is due within 6 months of filing your LLC. You may file online or by postal mail. There is no filing fee.
Also, every Alaska LLC must file a Biennial Report form every two years. The report is due before January 2 of the filing year. It may be filed online or by postal mail.
A registered LLC also makes it possible for you to do the following:
- Obtain permits or licenses necessary to operate your business, including health department permits, zoning permits, home occupation permits, professional licenses, and more. Some states require a seller's permit to conduct sales.
- Register your business with the state's tax agency.
- Open a business bank account.
- Apply for a business credit card.
- Purchase insurance for your business.
- Protect your name and logo with a trademark.