Structuring an Indiana business entity as a limited liability company (LLC) comes with a lot of benefits. Aside from asset protection, which limits the personal liability of owners against the actions and debts of the company, it also allows flexibility in terms of taxation. Those two major features make it a popular choice for many startups. However, entrepreneurship comes with LLC fees and responsibilities regardless of a company’s business entity structure. Proper management is necessary to achieve growth and success. At the same time, the company should make sure that it remains compliant with all state obligations.
LLC Fees To Know About
Among the obligations of Indiana LLCs are the required filings and reports as well as various fees. It starts with the formation of the company. There will also be ongoing obligations. The amount will depend on the state where the LLC will be formed.
Forming An Indiana LLC
A company that wishes to do business in Indiana will have to prepare for initial expenses associated with the formation.
- Name Reservation – The company name is crucial as it helps establish someone’s first impression of the business entity. It is also how consumers will remember the LLC, so creating a memorable name is important.However, that is not the only consideration. Indiana LLCs are required to follow the naming guidelines of the state. That includes the use of proper designators, which can be the phrase “Limited Liability Company” or any of its abbreviations like “LLC” or “L.L.C.”Aside from that, the company name should be unique, so an LLC can’t use a name if another entity in Indiana has already taken it. A name availability check on the database of the Secretary of State is necessary.In some cases, an LLC may opt to reserve the business name before going through the registration process by submitting a Name Reservation application online. While this step is not a requirement, it will help prevent another business entity from using the LLC’s desired name for 120 days. The filing fee for this submission is $10. Companies can also extend the reservation by filing a Reserved Name Renewal form and paying an additional $10 fee.
- Nominating A Registered Agent – All Indiana companies should appoint and maintain a registered agent in the state. This can either be an individual or a third-party organization that agrees to receive services of process, legal mail, tax notices, and other government correspondence on behalf of the LLC.Here are the qualifications that Indiana LLCs need to take note of when choosing a registered agent:
- Individual Registered Agent
- A resident of the state
- Has a physical street address in Indiana, which should be identical to the office address and cannot be a P.O. Box
- Should be at the given address during regular business hours
- Should be at least 18 years old
- Commercial Registered Agent
- Is not the business entity itself
- Should be authorized to do business in Maine
- Individual Registered Agent
LLC fees for the registered agent will depend on what the company chooses. For instance, hiring a third-party organization may cost more, but they may have more experience and knowledge in ensuring state compliance. DoMyLLC can serve as a registered agent in Indiana for only $99 per year.
- Public Records Filing – The formal registration of the business can only be completed by submitting formal paperwork and paying the corresponding filing fee. For Indiana LLC formation, that means the filing of a completed Articles of Organization with the Business Services Division of the Secretary of State. The filing fee is $98 for online submissions and $100 for paper forms. The standard processing time for the formation documents is around 5 to 7 days for paper submissions and 1 day for online filings.
- Obtaining an EIN – Indiana LLCs that have multiple members have to obtain an Employer Identification Number (EIN) from the Internal Revenue Service (IRS). This number is necessary for tax filing purposes. In some cases, even single-member LLCs may also need an EIN. That is because this number is needed to hire employees and open business bank accounts. LLCs can request an EIN through the website of the IRS for free.
The obligations of the LLC do not end after it has successfully registered its business with the state. There are ongoing obligations as well.
- Business Entity Report – The LLC will have reporting obligations for as long as it exists in Indiana. Those include the submission of a Business Entity report every 2 years. Doing so is necessary to maintain the good standing status of the LLC with the state. The submission can be done online or by mail. The online filing costs less at only $31. Meanwhile, companies that choose to submit by mail will have to pay $50.The deadline for this report is before the last day of the anniversary month of the LLC. The anniversary month refers to when the state approved the LLC formation. The first Business Entity Report of an LLC is due 2 years after its formation.
- Business Licenses And Permits – Depending on the industry the company is in, its activities, and its location, there may be additional business licenses and permits necessary. Check state and local government agencies to find out more about the requirements and fees.
- Business Taxes – Generally, an LLC is a pass-through entity in terms of taxation, so it does not have to report and pay income taxes at a corporate level. Instead, the LLC owners will have to file profits and losses in their personal tax returns.Indiana also imposes state taxes on any money paid to the business owners. These will flow through to personal tax returns, which is where the owners pay Indiana income taxes. The standard tax rate in the state is 3.3%.
- Sales Taxes – Companies selling physical goods or certain types of services will have to collect sales taxes and pay these to the Department of Revenue. The rates will vary depending on the county, city, or region where the primary place of business is located.
- Employer Taxes – LLCs that hire employees should collect and withhold payroll taxes from their workers. The normal rate is 7.65% of the taxable salary. Companies also have the option to withhold federal and state income taxes on the wages they pay to employees. In some cases, it may also be necessary to pay employee compensation insurance and unemployment taxes for employees. Check the requirements and costs with federal and state governing agencies.
Other Possible Fees
LLCs that wish to make changes to the company may need to fulfill certain requirements. Some of these may come with corresponding fees.
- DBA Filing – The state allows LLCs to use an alternate name or doing business as (DBA) instead of the legal name stated in the Articles of Organization. To do this, the company will have to file a Certificate of Assumed Business Name with the Secretary of State by mail, in person, or online. Mailed and in-person submissions cost $30, while online filings cost $20. However, the filing for an assumed name can only be accomplished after the LLC has successfully registered with the state. The company will be applying for the assumed business name.
- Changing Registered Agent – File a completed Notice of Change of Registered Agent with the Business Services Division. This filing is free of charge.
- Amending The Articles Of Organization – Making changes to the company’s formation documents may require the submission of the Articles of Amendment. This costs $30.
Understanding the various LLC fees in Indiana can help companies manage their expenses and budgets. However, that is only one of the responsibilities that LLCs have to take care of. There may be other paperwork submissions and processes that the company has to accomplish.
If all of these seem to be a bit overwhelming and time-consuming, Indiana LLCs have the option to get help from a reliable third-party organization like DoMyLLC. Our team of experts will not only help in completing the business formation process but also serve as the company’s registered agent. Additionally, we have extensive experience and knowledge in handling various state obligations. We can assist LLCs to make sure they remain compliant at all times including informing you of the LLC fees. Contact DoMyLLC to find out more about our services.
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