Iowa broke state records in 2021 with the most new-business filings in history. Over 33,000 new businesses were created, many of which were LLCs.
From creating a name to filling out an LLC operating agreement template, establishing an LLC business can be accomplished in just a few steps.
Curious about how to start an LLC in Iowa? We’ve created the following guide that tells you more about the process, as well as why it’s wise to create an operating agreement for your LLC in Iowa.
Is an LLC Operating Agreement Required in Iowa?
An LLC operating agreement is not required in Iowa. However, this doesn’t mean that you shouldn’t have one.
An operating agreement will be beneficial to your Iowa LLC both because you will have agreement among the members of your LLC and because you’ll have more protection of your business – even as a sole owner.
Iowa LLC Operating Agreement Laws
The Iowa LLC operating agreement laws are outlined in the Revised Uniform Limited Liability Company Act, §489.410.
You should read through this before filling out your LLC operating agreement, but we’ve outlined some of the main state-specific laws in our step-by-step guide to forming an LLC in Iowa below.
How Much Does It Cost to Form an LLC in Iowa?
Forming your LLC in Iowa depends on where you file it. The domestic filing fee is only $50, but the foreign filing fee will be $100. You will file your LLC with the Iowa Secretary of State Business Services Division.
How To Form an LLC in Iowa
Forming an LLC in Iowa requires a few steps, but it’s usually an easy process. Here are the steps to create and manage your LLC:
Step 1 – Name Your Iowa LLC
The first part of creating your LLC in Iowa is to decide on your name. Conduct a name search on the State of Iowa website so you can see if your name is available. Look to see if your name is available as a website name, too.
When creating your name, remember that LLCs in Iowa must contain ‘Limited Liability Company’, or the abbreviations ‘L.L.C.’ or ‘LLC’ as the last words in the name. You can abbreviate ‘Limited’ using ‘Ltd.’ and abbreviate ‘Company’ as ‘Co’.
Keep in mind that you are restricted from certain words that have the potential to confuse your LLC with a government agency. Restricted words like attorney or university may require a licensed individual to be part of your LLC should you choose to include them in your title.
Step 2 – Choose a Registered Agent
You’ll then be required to select an Iowa registered agent for your Iowa LLC. The registered agent will be the point of contact between the state and the LLC. They will receive important legal documents on behalf of the business.
A registered agent can be someone who lives in Iowa. They can also be a domestic or foreign business entity that has been authorized to do business in Iowa. Regardless of who you choose, the registered agent must have a physical street address in Iowa.
The registered agent can be anyone in the company, including yourself.
Step 3 – File Iowa LLC Articles of Organization
To establish your LLC with the state, you’ll file an official LLC document known as the articles of organization. You will file this document with the Iowa Secretary of State Business Services Division.
Iowa will allow you to create a single-member LLC, multimember LLC, or Series LLC. A series LLC is a business set up to hold several properties or interests under one LLC. Series LLCs let businesses hold multiple assets under one umbrella, but with separate risks.
Step 4 – Create an Iowa LLC Operating Agreement
The next step after filing your LLC articles of organization is to create your LLC operating agreement. The operating agreement will be one of the most important documents to keep your company running smoothly.
An operating agreement will be your LLC’s legal document that outlines its ownership and operating procedures.
They’re important for multimember LLCs because they will specify each person’s responsibilities and reduce the risk of conflict. They are also helpful because they help to protect the company’s owners, which is beneficial even for a sole LLC owner.
LLC operating agreements can be created easily when you use an LLC operating agreement template. You’ll have a few sections to fill out that outline the specifics of each team members’ responsibilities and company operations.
Remember that you don’t file your operating agreement with the state. It is an internal document that you should keep on file. It’s always a wise idea to have this document easily accessible.
Step 5 – Get an EIN for Your LLC
Your LLC will also need an Employer Identification Number (EIN). An EIN is a nine-digit number assigned by the IRS. This helps them keep track of businesses for tax reasons – think of it as a Social Security number for your business.
An EIN may also be referred to as a Federal Employer Identification Number (FEIN) or Federal Tax Identification Number (FTIN).
You will need an EIN to open a business bank account, file your federal and state taxes, and hire employees.
You can get an EIN for free from the IRS. Visit the IRS website to apply online.
Step 6 – Keep Your Company Compliant
After your LLC is established, you’ll still need to follow certain state and federal regulations. Certain types of businesses will need different permits that they’ll have to keep up-to-date.
The State of Iowa’s website and the U.S. Small Business Administration (SBA) website will have information on local, state, and federal taxes.
You will be responsible for sales tax and Iowa employer taxes if you have employees in Iowa.
Iowa also requires LLCs to file a biennial report with the Iowa Secretary of State. You can file this online, and it costs $60 to file each time. The report is due every odd year.
LLC Operating Agreement Template
Forming an LLC in Iowa requires only a few steps from beginning to end. Iowa doesn’t require you to have an LLC operating agreement, but it’s still wise to have one.
Try out an Iowa LLC Operating agreement template so that you can create an agreement that works for your LLC easily and efficiently:
