HOW TO START AN LLC IN ARKANSAS
Starting up an LLC is not always easy, but there are states that make it less complicated. One of them is Arkansas, where it is possible to create an LLC with relative ease. Anyone interested in creating an LLC, though, needs to know the rules and regulations regardless of whatever state they choose. Each state is a little bit different, so research is required to be sure the best options are being chosen and the right decisions made for LLC creation.
Naming the LLC
- An LLC can search online to find what name they can use. Not all names will be available, and there are words that cannot be used as any part of a name, even if they aren’t in use. Restricted words need more paperwork filed to be used, and prohibited words are completely off limits. These are words that are used by federal and state agencies, and allowing for their use by an LLC can confuse consumers. The name of the LLC has to have the words Limited Liability Company or their abbreviation in it, and it’s important to check to see whether the domain name is also available.
Selecting a Registered / Statutory Agent
- A registered agent is a person or entity who is authorized by an LLC to receive official correspondence. It can be a single person or a corporation, but there are some regulations on who can be an LLC’s registered agent. The person must live in the state and be a resident, and if a corporation is used it must be authorized to do business in the state of Arkansas. An individual within the LLC itself can serve as a registered agent, and that includes the owner of the company. Incfile offers FREE Registered Agent service for the first year with every package or as a $0 standalone service.
Filing Articles of Organization
- The Articles of Organization for a Domestic LLC can be filed online for a fee of $50. These Articles are, essentially, the lifeblood of the company and the documents that make it official. They provide information on who is operating the company, how large it is, and other factors that are important to note for tax, insurance, and other purposes. By filing the Articles, the LLC is showing an intent to develop and to form in that state for the purposes of operating a business.
Creating an Operating Agreement
- The majority of states do not require operating agreements, and Arkansas is among that group. That makes things much easier, although many LLCs decide to create an operating agreement for their own peace of mind. Doing that is certainly possible and an accepted practice, but there’s no need to do it for the state’s requirements. An LLC can be formed perfectly legally in Arkansas without any type of formal or informal operating agreement.
RUNNING YOUR BUSINESS
Getting Your EIN
- An EIN is an employee identification number, issued by the Internal Revenue service. Sometimes it is also called a Federal Tax Identification Number. It’s a unique number issued to each business. You’ll need an EIN to open a business bank account; file Federal and State Taxes; and hire employees.
- Before you get your EIN make sure your new business has been properly formed before applying and be wary of paid sites. EINs are free direct from the IRS.
- The easiest way is to apply online for an EIN. Note, the IRS website has office hours, and is only available Monday through Friday, 7am to 10pm. Yes, we also agree this is one of the most ridiculous things we’ve ever seen. You can call 1-800-829-4933, between 7am to 7pm of your time zone, Monday to Friday. Snail mail: You can download the form and mail it in.
Keeping Business and Personal Accounts Separate
- Get a business bank account for your business. This will help you protect your personal assets from potential creditors and lawsuits, and will also make life a lot easier come tax time.
- Get a business credit or debit card. This will help you keep your expenses separate and easier to track.
- No matter what business you run, accounting software and processes is a must for any small business. If you have an accountant, ask them which software they work with and recommend. A good accounting system is necessary to track income and expenses, so you can easily see if you’re making money and make filing income taxes so much easier.
- Always try and find something that will: sync with all of your bank and credit card accounts automatically – not just downloads, but auto sync; auto-match vendors, customers and other accounts; and let you accept credit cards and ACH drafts with ease. This can be applied for online, as can unemployment.
Filing Arkansas LLC Taxes
- State income tax withholding and employee withholding tax are both required by the state.
- Arkansas requires LLCs to pay unemployment insurance tax.
- Sales tax is a requirement for any LLC that offers taxable goods and services.
- State licensing is also important, and often required based on the type of business that is being operated.
Getting Insurance for your LLC
- One of the most important requirements for an Arkansas LLC is workers’ compensation insurance. This is a requirement of the state, and something every LLC must have if they hire employees.
- While there are many other types of insurance available, including general liability, that might be helpful for an LLC to have, the state requirements come first. After that, other kinds of insurance may be worth exploring.
KEEPING YOUR LLC COMPLIANT
- Arkansas has hiring guidelines that need to be followed. These protect workers from unfair hiring practices, and also help reduce the chances of a business hiring workers who are not legally authorized to work in the United States. Many states also require the filing of an annual report, but Arkansas doesn’t have that requirement. With no annual report requirement, it s one less thing that an LLC in that state needs to worry about.
FILING A FOREIGN LLC IN ARKANSAS
- It is possible to register a foreign LLC in Arkansas. It costs $270 if filed online and $300 for a paper filing.
ABOUT HOW TO START AN LLC
I'm an entrepreneur myself. When talking to others who want to start their own business, they often get wrapped up in the nitty gritty of paperwork and forming the company. They forget that what really matters is customers, sales, and profit. That's why I created How to Start an LLC.org: a simple resource and guide so you can spend less time on forming your company, and more time on building it.
My lawyers want me to remind you that I'm not a lawyer and that I'm completely unqualified to offer legal advice. This site is meant to serve as a reference for you on your journey. If you have questions or concerns, please contact a qualified lawyer (or accountant) to help you. Also, as a general rule, never take random legal advice on the internet.