This guide will take you through how to start an LLC in Tennessee and you’re going to love it. There is a step by step guide that will help you through the process to setup your Tennessee LLC. The five step process will take you through how how to check your business name, file articles of organization, setup a Tennessee LLC operating agreement, find a registered agent service and of course get your Federal Employer Identification Number.
I also put together a few resources that will be helpful for you that you’ll need to think about like a business bank account, business insurance and whether you’re a sole proprietorship or have multiple LLC members – you’re going to find this useful and helpful.
Name Your Tennessee LLC
This is by far one of the most important pieces of how you want to build your Tennessee LLC. You need to check whether your business name is available and if so – are you going to have the website domain. Even if you’re going to setup the next Tennessee whiskey business – you will need a domain for your individual or business entity. Tennessee is known for hot fried chicken, moon pies, whiskey and some good ‘ol fashioned country music.
If you’re going to be the next song writer or singer, you can always use your name but it’s important to make sure you’re following the Tennessee LLC naming guidelines.
There are a few things to keep in mind:
- Your LLC name must include the phrase “Limited Liability Company” or one of its abbreviations (LLC or L.L.C.)
- Your LLC name can’t imply that your company is something that it isn’t. For example, you can’t use words like “Banking,” “Insurance,” or “Corporation” unless your LLC is actually in the business of providing those services.
- Your LLC name can’t be the same as any other business name already on file with the Tennessee Secretary of State.
Use the Tennessee Business Entity Search to find out if your desired LLC name is available. You can use the Tennessee Department of Business Services Online at: http://tnbear.tn.gov where you can do this lookup.
The Tennessee Secretary of State’s office Tre Hargett is the place you’ll need to go in order to determine your name for the next Limited Liability Company in Tennessee.
FIND YOUR REGISTERED AGENT IN TENNESSEE
A Registered Agent is someone who agrees to receive and accept legal documents on behalf of your LLC. The Registered Agent must have a physical address in the state and be available during business hours.
You may act as your own Registered Agent, but we don’t recommend it. If you do, your home or office address will be part of the public record and subject to being published online.
Instead, we recommend using a professional Registered Agent service like Northwest Registered Agent. You can check out their service by clicking on our link in the sidebar to the right under ‘Top Services’. They will help you with the registered agent services that you’re looking for.
There are probably local law firms that can help you with a registered agent service but if you’re looking for a LLC formation service that can also act as your registered agent, I’d highly recommend taking a look at Northwest Registered Agent.
They can act as your Tennessee Registered Agent which is what you’ll need and can also reference in your operating agreement that you’ll have to setup too.
Prepare and File Articles of Organization
The next step in starting your LLC is filing your articles of organization with the Secretary of State.
The articles are a short, simple document that gives the state basic information about your LLC, like your business name and address.
You can get the Articles of Organization (Form LL-C-4) by going to the Secretary of State’s Business Services Online website.
Choose your formation package and you’re on your way to getting started with business in Tennessee.
You have a couple options when it comes to filing your Articles of Incorporation. You can either do it online or by mail.
If you file by mail, you’ll need to include a filing fee of $100. The LLC will be formed when the state approves your Articles of Organization, which usually takes about 10 business days.
You should receive a notice in the mail once your LLC has been approved.
Create an operating agreement
Once your LLC has been formed, you’ll need to create an operating agreement. This is an internal document that outlines how the LLC will be run and sets forth the rights and responsibilities of the members (the people who own the LLC).
The operating agreement isn’t required by law, but we highly recommend that you have one.
If you don’t have an operating agreement and something goes wrong (e.g., a member gets sued), the state default rules will apply, which may not be what you want.
An operating agreement can help you avoid problems by spelling out how the LLC will be run and setting up rules to resolve disagreements.
You can find template operating agreements online or you can hire an attorney to help you create one.
Imagine if one of the LLC owners has an issue with business debts or doesn’t file the right business licenses. You’ll have an operating agreement that will spell out everything you discussed. You can also discuss in this document the difference between personal assets, the business structure and any professional service that you want to clarify between LLC members.
Get Your EIN
The next step is to get your Employer Identification Number (EIN) from the IRS website.
Your EIN is like your Social Security number for your business. You’ll use it to open a business bank account, file your taxes, and more.
You can apply for your EIN online, by fax, or by mail.
If you apply online, you’ll get your EIN immediately. If you apply by fax or mail, it will take about four business days to receive your EIN.
You’re going to need this when setting up a bank account with financial institutions. Depending on how you collect sales tax and if you’re going to be setting a Limited Liability Company or just need help with federal taxes – this is something you’re going to need to provide to the Internal Revenue Service.
Get a Business License
You may need to get some licenses and permits before you can start operating your LLC. The licenses and permits you need will depend on your business activities, location, and industry.
You can visit the Tennessee Business Licensing Service to find out what licenses and permits you need.
To get started, you’ll enter your business type and county/city into the online licensing tool. The tool will then provide a list of licenses and permits you may need to obtain.
For example, if you’re opening a restaurant in Nashville, you’ll need to get a food service license, a business license, and a sales tax permit.
You can apply for most licenses and permits online, but some require that you submit an application by mail or in person.
Once you have all the licenses and permits you need, you’re ready to start operating your LLC! Now – go add to the list and be one of the Tennessee LLCs so you can feel like your business entity is a part of the club knowing that you filed the Tennessee LLC articles the right way.
Filing an Annual Report
All LLCs in Tennessee are required to file an annual report with the state. The report is due on February 15th and can be filed online, by fax, or by mail.
The annual report is used to update the state on your LLC’s contact information and to let the state know if there have been any changes to your LLC since it was formed.
For example, if you’ve changed your registered agent or added a new member to your LLC, you’ll need to include that information in your annual report.
The annual report is relatively simple and shouldn’t take more than a few minutes to complete.
You can find the annual report form on the Tennessee Secretary of State website.
Once you’ve completed the form, you can submit it online, by fax, or by mail.
If you have any questions about filing your annual report, you can contact the Tennessee Secretary of State at (877) 850-4959.
You’ll also want to include the physical street address and make sure you’re paying the minimum fee for the LLC member that is associated to this. If you’re setting up a Tennessee Limited Liability Company – this is going to be something you really need to focus on.
Paying Annual Taxes
All LLCs in Tennessee are required to pay an annual business tax. The tax is due on April 1st and can be paid online, by mail, or in person. The tax structure you setup should be run by a business accountant to make sure you’ve setup the Federal Tax Identification Number correctly and get the right business advice. If you’re going to have business transactions and business expenses, you’re going to need to make sure your personal liability is not an issue whether or not it’s a professional LLC or a foreign LLC.
The amount of tax you owe will depend on the gross receipts of your LLC for the previous year. You should use some type of business expense tracking software that other small business owners have recommended or you’ve gotten business advice delivered straight and you’re ready to go!
For example, if your LLC had gross receipts of $10,000 or less in the previous year, you’ll owe a business tax of $100.
If your LLC had gross receipts of more than $10,000 but less than $100,000 in the previous year, you’ll owe a business tax of $250.
And if your LLC had gross receipts of more than $100,000 in the previous year, you’ll owe a business tax of $500.
You can find the business tax form on the Tennessee Department of Revenue website.
Once you’ve completed the form, you can submit it online, by mail, or in person.
If you have any questions about paying your annual business tax, you can contact the Tennessee Department of Revenue at (615) 253-0600.
Starting an LLC in Tennessee is a relatively simple process. Just make sure you file the necessary paperwork with the state and obtain the required licenses and permits. And don’t forget to pay your annual business tax!
How much does it cost to get a LLC in Tennessee?
The filing fee for the Certificate of Formation is $50.
How long does it take to get an LLC in Tennessee?
If you file online, your LLC will be formed within 1-2 business days. If you file by mail, it will take 4-6 weeks for your LLC to be formed.
What is required to start an LLC in Tennessee?
To form an LLC in Tennessee, you’ll need to file the Certificate of Formation with the Secretary of State and pay the $50 filing fee. You should also obtain the required licenses and permits for your business.
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