Starting a limited liability company (LLC) in Idaho is a smart way to help protect your personal assets while still maintaining flexibility in how you manage your business. The Gem State’s skilled workforce, solid infrastructure, low taxes, and limited regulation make it a great place to be a small business owner. Plus, there’s no fee to file your annual report, unlike in most states.
You can form an LLC in Idaho by filing a certificate of organization with the Idaho Secretary of State. Here’s everything you need to know to form your business in compliance with state laws.
Basics of Idaho LLCs
Each business structure comes with its own advantages and disadvantages that are important to understand before you start a new venture. LLCs are similar to corporations in that they offer limited liability, which can protect the owners’ personal assets from business debts. Like corporations, you also have to register LLCs with the state.
However, LLCs also have the ability to file as a pass-through entity, similar to sole proprietorships, and have fewer structural obligations than corporations. That said, LLCs still need to meet state compliance requirements, such as filing an annual report with the Secretary of State.
If you want to start an LLC, Idaho is a good place to do it. Here are some of the unique advantages:
- Access to a strong local economy
- Among the top ten best states for taxes
- No filing fee for annual reports, which can save your business a lot in long-term filing costs
- Diverse incentives for qualifying businesses
How to start an Idaho LLC in 6 steps
To form an Idaho LLC, file a certificate of organization, also called articles of organization, with the Secretary of State. To do this, you’ll need an available business name and registered agent. Once it’s formed, there are a few more things you need to ensure your business runs smoothly.
You can have LegalZoom file for you, or file yourself by following these steps.
Step 1: Name your Idaho LLC
When you choose a business name for your LLC, make sure to follow Idaho naming requirements:
- Your business name must be distinguishable from any other registered business in Idaho. Check your proposed name availability through the Idaho Secretary of State’s business entity search tool.
- Your name must include “Limited Liability Company,” “Limited Company, ”or the abbreviation “L.L.C.,” “LLC,” “L.C.,” or “LC.”
- Business names must use English letters A through Z and Arabic numerals 1 through 9, but they can use any symbols readily available on a standard English keyboard.
- The name can’t be “grossly offensive,” and it can’t imply that you’re a government organization.
If you need more time to get your paperwork together, you can reserve your business name for up to four months. All you need to do is file a Reservation of Legal Entity Name form with the Idaho Secretary of State for a $20 filing fee.
Step 2: Appoint a registered agent
In Idaho, every business entity must appoint a registered agent who’s responsible for receiving legal documents on behalf of the business. The LLC’s registered agent must:
- Be a resident of Idaho or a registered agent service authorized to operate in Idaho
- Have a physical street address in the state (not a P.O. box)
- Be available to receive documents during regular business hours
You can serve as your own registered agent, choose someone you trust, or use a professional registered agent service. Registered agent services can save you time, keep your personal address off the public record, and give you confidence that you won’t miss important notices. With LegalZoom’s Boise-based registered agent services, you’ll get an alert as soon as we get mail for you.
Step 3: File a certificate of organization
To officially form your Idaho LLC, you’ll need to file a certificate of organization with the Idaho Secretary of State. You can file online through the SOSBiz portal for $100 or file by mail for $120. The Secretary of State generally charges an additional $20 fee for any paper filings that are submittable online. You can also request expedited service for an additional $40 or same-day service for an additional $100.
The LLC certificate of organization will ask for the following details:
- The name of your LLC
- The street and mailing address for your LLC
- The name and street address of your registered agent
- The name and address of at least one governor of your LLC. A governor is either a member or a manager of the company, depending on the management structure.
- The mailing address where you’d like to receive your annual report notices
- Printed name and signature of the organizers or the people filing the certificate of organization
Note that if you provide certain professional services like accountancy, architecture, dentistry, law, medicine, psychology, or social work, you’ll need to file a professional LLC certificate of organization instead of the standard form. This is a different paper form that has an additional line to specify your profession. You can find the full list of professions that apply on the second page of the form. Otherwise, the process is the same.
Step 4: Create an operating agreement
Although Idaho doesn’t require LLCs to have an operating agreement, it’s wise to have a comprehensive one in place. An operating agreement outlines how your LLC functions, which can help prevent conflicts among members or inform court resolutions should a conflict arise. Here’s what it typically covers:
- How much of the LLC each member owns
- Who manages the LLC and their duties
- Profit and loss distribution
- Procedures for making major decisions
- How to add or remove members
- The steps to dissolve or transfer the LLC, if necessary
An operating agreement is important for a single-member LLC because it helps keep your personal and business assets separate. For multiple-member LLCs, it creates a guideline for how to navigate important decisions and helps prevent disagreements over roles and responsibilities.
If you choose to create the operating agreement yourself, a well-structured Idaho LLC operating agreement template can make the drafting process easier, especially when outlining key provisions like profit sharing or voting rights.
Still, since this document plays a critical legal role, many LLC owners prefer to have an attorney review or draft it to ensure it’s airtight and customized to their specific business needs. LegalZoom can help you create an operating agreement that’s comprehensive and helps protect your limited liability status.
Building a business is enough work as it is. We'll help you start your LLC with confidence.
Step 5: Obtain an EIN and open a business bank account
If your LLC has more than one member, or if you plan to hire employees, you’ll need an employer identification number (EIN) from the IRS. Even if you’re a single-member LLC, an EIN helps keep your personal and business taxes separate. You can apply for an EIN on the IRS website or use LegalZoom’s EIN filing service.
Once you have your EIN, you can open a business bank account. This is important, because it maintains a clear divide between your personal and business finances and protects your limited liability status. A business bank account also makes it easier to track your expenses and income for tax and accounting purposes.
Step 6: Register for state taxes and business licenses
Once your Idaho LLC is official, you’ll need to register with the Idaho State Tax Commission for applicable taxes. These are some common taxes for small businesses:
- Sales tax. If your LLC sells goods or services, you’ll need to register for Idaho’s sales tax, which is currently 6%. Idaho also charges sales tax on activities like bowling and golf, equipment rentals, and admission fees.
- Employee withholding tax. If your LLC has employees, you’ll need to register for employer withholding tax. Idaho law requires all employers to withhold state income tax from employee wages.
- Unemployment insurance tax. Employers in Idaho must also register with the Idaho Department of Labor to pay unemployment insurance tax. This tax funds the state’s unemployment insurance program.
- Excise taxes. Excise taxes include fees for amusement devices, vending machines, beer, wine, cigarettes, tobacco, and fuel. These taxes are usually necessary for distributors and wholesalers.
- Lodging taxes. If your business is involved in lodging, you’ll need to register for related taxes, such as travel and convection tax. Some local communities, such as resort destinations, also have an additional lodging tax.
You can register for most taxes through the Idaho Business Registration System, but you should also ask about local taxes at your city clerk’s office. Keep in mind that you’ll need to report business income on your personal tax returns, as LLCs file as pass-through entities by default in Idaho.
Depending on your industry, you may also need business licenses or permits. For example, professional LLCs provide services that typically have licensing requirements. If you plan to build, you’ll need construction permits. And if your business will generate pollution, you might need environmental permits from the Idaho Department of Environmental Quality. You should also check your city clerk’s office about local permits and licenses.
LegalZoom has a business license service that can help you find all the licenses and permits you need to operate legally in your area.
Starting a business takes courage. LegalZoom makes sure the legal details don’t stand in your way, from the day you register until the day you retire.
What to do after forming your Idaho LLC
You’re almost there, but you’re not quite done learning how to start an LLC in Idaho. There are a few more steps to complete so that your business runs smoothly. While compliance is vital to keep your LLC in good standing, these other tasks are optional, but highly recommended.
- Maintain compliance. You’ll need to file an annual report with the Idaho Secretary of State to keep your LLC in good standing. The report is due each year by the close of your LLC’s anniversary month. You can file it online through the SOSBiz portal, and there’s no filing fee.
- Register a domain name. When you do your Idaho business entity search, check if there’s a similar domain name available. You want to make sure that you can secure the domain name to create a website and market your business online.
- Obtain a certificate of good standing. A certificate of good standing verifies that your Idaho LLC legally exists and is compliant with state laws. You may need it for contracts, loans, or when expanding your business into other states. You can request one from the Idaho Secretary of State for a $10 filing fee.
Note: The Secretary of State has warned business owners of scams regarding certificates of good standing. Always check that you are filing on the appropriate website.
- Consider a foreign LLC. If you plan to do business outside of Idaho, you may need to register as a foreign LLC in the other states where you want to conduct business.
- Trademark your business. Trademarks prohibit other businesses from using your name, logo, and other branding. You can apply for a state trademark through the Idaho Secretary of State or seek federal protection through the U.S. Patent and Trademark Office (USPTO). The process can be complex, but LegalZoom’s trademark registration services make it easier.
How much does it cost to start an LLC in Idaho?
It costs at least $100 to form an LLC in Idaho, which is the filing fee for a certificate of organization. This aligns with most other states’ fees, although Idaho is one of the few states that doesn’t charge a fee to file your required annual report each year. However, you might choose to pay for a compliance service that helps you stay on top of that filing and other requirements. It’s often worth the added cost to protect your good standing while you focus on running your business.
Here’s the breakdown of the basic costs:
- LLC name reservation: $20 to file online or $40 by mail
- Certificate of organization: $100 to file online or $120 by mail
- Registered agent: $100–$300 per year for a professional service
- Operating agreement: $99 and up
- Licenses and permits: Varies by location and industry
The total cost of Idaho LLC registration, therefore, ranges from $100 to about $550, plus the cost of any business licenses, permits, and ongoing compliance requirements.
How to start your Idaho LLC with LegalZoom
If figuring out how to start an LLC in Idaho sounds like a lot, don’t worry. LegalZoom can handle everything from filing your certificate of organization and annual report to providing registered agent services and creating an operating agreement. Whether you just need help with the paperwork or want end-to-end assistance, get started by exploring our LLC formation services.
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FAQs about Idaho LLCs
How long does it take to form an Idaho LLC?
It typically takes the Secretary of State 10 to 15 business days to process your certificate of organization, although online filings typically process faster. Once your filing is approved, your LLC will be officially recognized by the state.
What are some common mistakes to avoid when forming an Idaho LLC?
While there’s no one right way to start a business, there are some things that first-time business owners should watch out for to help ensure their company runs smoothly.
- Being your own registered agent. This isn’t always a mistake, but it’s important to know the risks. First, the registered office address is public knowledge. Second, legal notices that get lost in the mail could lead to default judgments. If you want to protect your privacy and don’t have the bandwidth to stay on top of documents, it’s best to work with a professional service.
- Skipping operating agreement. Courts often turn to operating agreements when making judgements on internal business disputes. Without one, they’ll rely on state laws, which may not be in your business’ best interest.
- Mixing personal and business finances. This can lead courts to pierce the corporate veil, meaning they may put aside the company’s limited liability status and hold owners personally responsible for business debts or other actions.
- Missing annual report deadlines. Annual reports are incredibly important to keep your business in good standing. If you fail to file them by the due date, the Secretary of State may dissolve your business.
- Inadequate record-keeping. Although record-keeping requirements aren’t as strict for LLCs compared to corporations, records are vital to your business. They serve as evidence if there’s a legal dispute and protect your limited liability status. Well-kept records also help ensure your tax returns are accurate, preventing future issues.
- Not obtaining necessary licenses. It’s critical to make sure your business has all the proper licenses and permits before you start operating. Licenses exist on the federal, state, and local levels for various activities. If the research feels daunting, have LegalZoom do it for you.
In addition to formation and registered agent services, LegalZoom also offers compliance, accounting, and licensing services to support your business every step of the way.
What is needed to form an LLC in Idaho?
To form an LLC in Idaho, you need to file a certificate of organization with the Idaho Secretary of State, appoint a registered agent, and pay the required filing fee. You’ll also need to register for any applicable state taxes and licenses, depending on your business activities.
What are Idaho registered agent requirements?
An Idaho registered agent can be either an individual resident or a commercial entity authorized to operate in the state. Agents need to have a physical street address (not a P.O. box) in Idaho. They also need to be available during regular business hours to accept legal and official documents on behalf of the business they serve.
What are the benefits of filing an LLC in Idaho?
Idaho LLCs provide personal liability protection, which separates your personal assets from your business obligations. Idaho offers a business-friendly environment with relatively low fees and a simple registration process. Idaho LLCs also offer flexible management structures and tax options.
How do I maintain my LLC in Idaho?
To maintain an LLC in Idaho, you must file an annual report each year by the last day of your LLC’s anniversary month. The report is free and can be filed online. You’ll also need to pay any applicable state taxes and ensure that your business licenses and permits remain up to date.
How do I transfer LLC ownership in Idaho?
To transfer ownership, Idaho LLCs should follow the terms outlined in the LLC operating agreement. You’ll also need to file an amendment to your certificate of organization and get the certificate of amendment from the Idaho Secretary of State.
Carolyn Albee and Rudri Bhatt Patel contributed to this article.
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