What to Do After Forming an LLC

Filing articles of organization creates the LLC. These next steps make it work properly and keep the liability protection that is the main reason for forming one (Cornell LII).

1. Operating agreement

Even single-member LLCs benefit from a written operating agreement covering ownership, management, voting, profit distribution, and what happens if a member leaves or dies. Some states require one.

2. EIN

Get an Employer Identification Number from the IRS for free online. You need it for a bank account, hiring and most tax filings (IRS). Avoid sites that charge for this.

3. Business bank account

Keep business money separate. Mixing personal and business funds is a common reason courts "pierce the veil" and hold owners personally liable.

4. Licenses and permits

City, county and state licenses, and professional or industry permits. See do I need a business license.

5. Taxes

• Decide how the LLC will be taxed: by default as a sole proprietorship or partnership, or by election as an S corporation or C corporation.
• Register for state sales tax and payroll taxes if needed.
• Make quarterly estimated tax payments if required.

6. Annual reports and fees

Most states require annual or biennial reports and fees, and some charge franchise taxes. Missing them can lead to penalties and administrative dissolution.

7. Registered agent

Keep a registered agent with a current address to receive legal papers.

8. Federal beneficial ownership reporting

Under a March 2025 FinCEN rule, companies created in the US are exempt from beneficial ownership information reporting under the Corporate Transparency Act; foreign companies registered to do business in the US may still have to report (FinCEN). Check FinCEN for current rules.

9. Insurance

General liability, professional liability, property, commercial auto, and workers' comp if you have employees.

10. Contracts and records

Sign contracts in the LLC's name with your title, keep minutes of major decisions, and maintain good books.

Hiring employees

Register with your state, verify eligibility with Form I-9, withhold and pay payroll taxes, and get workers' comp coverage. See payroll tax responsibilities.

A business lawyer can draft the operating agreement and review contracts.

Sources

1. U.S. Small Business Administration: Choose a business structure
2. IRS: Get an employer identification number
3. FinCEN: Beneficial ownership information reporting
4. Cornell Law School LII: Limited liability company