Forming an LLC sounds like something that requires a lawyer, a stack of documents, and a check written to someone who knows things you don't. It doesn't. For most single-member LLCs and many multi-member ones, the entire process is a few forms, a state filing fee, and about an hour of focused time. The legal and formation service industry has a financial interest in making this seem more complicated than it is. It isn't.
This guide walks through the full DIY process – what you actually need to do, in what order, what it costs, and where the few genuine decision points are. By the end of it you'll either have everything you need to file yourself, or you'll know exactly why your situation is one of the uncommon ones that needs professional help.
Before you start, it helps to understand what you're doing mechanically. Forming an LLC means registering a new legal entity with your state government. Once registered, that entity has a legal existence separate from you. It can own assets, sign contracts, open bank accounts, and be named in lawsuits independently of you personally.
The paperwork that creates it is called Articles of Organization (in most states) or a Certificate of Formation or Certificate of Organization depending on where you live. You file it with your state's Secretary of State office, pay the filing fee, and once it's approved, the LLC legally exists. That's the core of the process. Everything else – the operating agreement, the EIN, the bank account – builds on top of that foundation.
Most people should form their LLC in the state where they live and do business. This is simpler, cheaper, and more practical than it sounds, despite what you may have heard about the supposed advantages of Delaware, Wyoming, or Nevada.
The "form in Delaware or Wyoming" advice is genuinely useful for certain businesses – those seeking venture capital investment, those with complex multi-member structures, or those wanting to take advantage of specific privacy laws. For a single-member LLC running a service business, a freelance operation, or a local business, it's usually counterproductive. If your LLC is formed in Wyoming but you live and work in California, you still have to register as a foreign LLC in California and pay California's fees on top of Wyoming's. You end up paying twice for the privilege of the out-of-state formation, and the practical benefits rarely materialise at small business scale.
Form in your home state unless you have a specific, well-understood reason not to.
Your LLC needs a unique name that's distinguishable from other registered business names in your state. The name must include an LLC designator – "LLC," "L.L.C.," or "Limited Liability Company" are standard options. Most states also prohibit using words like "Bank," "Insurance," or "Corporation" without specific regulatory approval.
Before you file anything, search your state's business name database to confirm your chosen name is available. Every Secretary of State website has a business entity search tool that's free to use. Search for the exact name and close variations – if "Greenfield Consulting LLC" is taken, "Greenfield Consultants LLC" may or may not be available depending on your state's rules around "distinguishable" names.
If you want to operate under a different name than your LLC's legal name – using a trade name or "DBA" (doing business as) – you can typically register that separately after the LLC is formed. You don't need to match your brand name to your legal entity name if they're different.
Check domain availability for your business name at the same time, even if you're not planning to build a website immediately. Securing the domain before it's taken costs $10–$15 and avoids a naming problem later.
Every LLC is required to have a registered agent – a person or company with a physical address in your state who is designated to receive legal documents, government correspondence, and service of process (meaning lawsuits) on behalf of the LLC. This address must be a physical street address, not a P.O. Box.
You have three practical options. You can serve as your own registered agent using your home or business address. This is free and completely legal. The downside is that your address becomes part of the public record and could appear in legal filings visible to anyone. If you work from home and don't want your home address publicly associated with your business, this is a meaningful consideration.
You can use a friend or colleague's business address as your registered agent if they're willing and they're physically present at that address during business hours. This is less common but works.
The most popular option for people who value privacy or who move frequently is a registered agent service. These cost $50–$150 per year and provide a professional business address for receiving legal documents. Companies like Northwest Registered Agent, Registered Agents Inc., and ZenBusiness offer these services. Northwest is widely recommended for its privacy practices – unlike some competitors, it doesn't sell customer data to third parties.
If you use a formation service to set up your LLC (discussed below), registered agent service is typically included for the first year.
This is the filing that legally creates your LLC. You do it through your state's Secretary of State website. Most states have an online filing portal where you can complete and submit the form directly. The process takes 10–20 minutes.
The information you'll typically need to provide includes your LLC's legal name, your registered agent's name and address, the principal address of the LLC, the names of the members or managers (depending on your state's requirements), whether the LLC is member-managed or manager-managed, and your contact information.
Member-managed vs. manager-managed is a distinction worth understanding. Member-managed means all members participate in running the business – the default for most small LLCs. Manager-managed means a designated manager (who may or may not be a member) makes operational decisions. For a single-member LLC, this distinction is irrelevant; you'll choose member-managed. For a multi-member LLC, choose based on how you've agreed to run the business.
Filing fees vary by state. Some common examples: California is $70 to file Articles of Organization but also imposes a mandatory $800 annual franchise tax minimum (one of the highest in the country). Texas charges $300. Florida charges $100. Wyoming charges $100 with no annual franchise tax. New York charges $200 but also has a unique publication requirement – you must publish a notice of formation in two local newspapers for six consecutive weeks, which can cost $500–$2,000 depending on your county. This is a well-known quirk of New York LLC formation that surprises people. If you're in New York, budget for it.
Processing time varies from same-day to several weeks depending on the state and whether you pay for expedited processing. Most states offer online filing with approval in 1–7 business days.
An operating agreement is an internal document that governs how your LLC operates. Most states don't legally require one, but every LLC should have one regardless. Here's why: if you ever face a dispute, a lawsuit, or a question about how the business is run, the operating agreement is the document that answers it. Without one, your state's default LLC rules apply – which may or may not reflect how you actually want things to work.
For a single-member LLC, an operating agreement is mostly housekeeping – it documents that you are the sole member, how profits are handled, and what happens to the LLC if you become incapacitated or want to dissolve it. It reinforces the separation between you and the business and supports the liability protection the LLC structure provides. You can find free single-member LLC operating agreement templates from sources like SCORE, LegalZoom's free resources, or law school small business clinics. Most are two to three pages and take 15–30 minutes to complete.
For multi-member LLCs, the operating agreement is genuinely important and worth more careful attention. It should address ownership percentages, how profits and losses are divided, decision-making authority, voting rights, what happens if a member wants to exit, and what happens if the members disagree. A template is a reasonable starting point for simple equal-split partnerships between two people who trust each other. For anything more complex – unequal contributions, performance-based equity, outside investment – legal help drafting the operating agreement is worth the cost. Getting this wrong between partners is far more expensive to fix later than a $500–$1,000 attorney fee upfront.
An EIN (Employer Identification Number) is essentially a Social Security number for your business. You need one to open a business bank account, hire employees, and file certain business tax returns. Even if you have no employees and won't immediately need it for banking, getting an EIN is a quick free step that's worth doing at formation.
Apply for an EIN through the IRS website at irs.gov/ein. The application is free, takes about 10 minutes, and issues your EIN immediately upon completion. There is no reason to pay a third party to obtain an EIN – any service charging for this is simply doing what you can do yourself for free in ten minutes.
One practical note: if you're a non-US citizen forming a US LLC, the EIN application process is slightly different and may require a phone application rather than online filing. The IRS has instructions for this on their website.
This step is not part of the official state filing process, but it's as important as anything that is. Maintaining a separate business bank account – and keeping business and personal finances completely separate – is what preserves the liability protection your LLC provides. If you pay personal expenses from the business account, deposit business income into your personal account, or otherwise treat the two as interchangeable, a court can determine that the LLC isn't a genuinely separate entity and hold you personally liable for business debts. This is called "piercing the corporate veil" and it happens often enough that it's not a theoretical risk.
Most banks require your Articles of Organization (your state filing confirmation), your EIN, and a form of ID to open a business account. Some require an operating agreement. Online banks like Mercury, Relay, and Bluevine have become popular for small business accounts because they have no monthly fees, no minimum balance requirements, and a streamlined digital opening process that often takes less than a day. Traditional banks work fine too, though their small business account requirements and fees are more variable.
Some states have additional requirements beyond the Articles of Organization filing that you need to be aware of.
California requires an LLC to file an initial Statement of Information within 90 days of formation (and then biennially thereafter), at a cost of $20. The $800 annual franchise tax minimum applies every year regardless of whether the LLC has any income.
New York has the publication requirement described above. This is non-negotiable and genuinely expensive depending on your county. Research the estimated cost for your specific county before deciding whether to form in New York or whether an alternative state makes more sense for your situation.
Some states require you to obtain a business license or local operating permit to legally conduct business within the state or municipality. This is separate from the LLC registration and varies enormously by location and industry. Check your state's business portal and your city or county government's website for local licensing requirements.
Formation services like ZenBusiness, Incfile (now Bizee), and Northwest Registered Agent occupy the middle ground between pure DIY (filing directly with the state) and hiring an attorney. They handle the paperwork, file on your behalf, and typically bundle in a year of registered agent service. They don't provide legal advice.
For a straightforward single-member LLC in a state without unusual requirements, direct state filing is the most cost-effective option. You pay the state fee, and that's it. The process is not difficult.
Formation services make most sense when you want convenience over cost savings, when you want registered agent service included without sourcing it separately, or when your state's filing system is clunky enough that a service's streamlined interface saves meaningful time. Northwest Registered Agent is frequently recommended because it doesn't resell your information to marketers, which is a real issue with some competitors. Their base formation service runs $39 plus state fees in most states, with registered agent service at $125/year after the first year.
Avoid the cheapest formation services that advertise "free LLC formation." They recover the cost through registered agent upsells, add-on fees, and selling your business information to third parties. The registered agent service component is where most of the hidden cost lives. Read the fine print before you commit.
Here's a realistic cost summary for a straightforward single-member LLC formed in your home state without using a service:
State filing fee: $50–$300 depending on state. Most common range is $100–$150. California ($70 to file, plus $800/year franchise tax) and New York (filing plus $500–$2,000 publication requirement) are the notable outliers.
Registered agent service: $0 if you serve as your own registered agent; $50–$150/year if you use a service.
EIN: Free directly from the IRS.
Operating agreement: Free using a template.
Business bank account: Free with fee-free digital business banks; varies with traditional banks.
Domain name: $10–$15 for the first year if relevant.
For most people forming a straightforward LLC: $100–$300 total in the first year, plus ongoing annual state fees and registered agent costs if applicable.
Don't pay a service to obtain your EIN. This takes ten minutes on the IRS website and is completely free. Any service charging $50–$100 for EIN obtainment is charging for something you do yourself in one browser tab.
Don't form in a different state to chase perceived tax advantages without understanding the full picture. Wyoming and Delaware have legitimate advantages for specific situations, but for most small businesses operating in their home state, out-of-state formation adds cost and complexity without meaningful benefit.
Don't skip the operating agreement because it's not legally required in your state. It's the document that protects you internally and supports your liability protection externally. Templates are free and it takes less than half an hour to complete for a single-member LLC.
Don't use a personal bank account for business transactions after formation. The liability protection you created by forming the LLC depends on treating it as a genuinely separate entity.
How long does it take to form an LLC? In most states with online filing, you can submit the Articles of Organization in under 30 minutes and receive approval within 1–5 business days. Some states offer same-day or next-day expedited processing for an additional fee. The entire process from decision to approved LLC can realistically be completed in a week.
Do I need an attorney to form a single-member LLC? No. For a straightforward single-member LLC, the process is administrative rather than legal. You're completing forms, not making complex legal decisions. An attorney is worth consulting if you have partners, unusual ownership arrangements, or are in a regulated industry.
Can I change the LLC's name or structure after formation? Yes, though it requires a filing and fee. Name changes are done by filing an amendment to your Articles of Organization with the state. Adding members requires updating the operating agreement and, in some states, filing an amended Articles of Organization.
What happens if I form the LLC and then don't use it? Most states charge annual fees or franchise taxes regardless of whether the LLC has any income or activity. In California, the $800 minimum franchise tax applies even to inactive LLCs. If you form an LLC and decide not to use it, formally dissolve it through the state to stop the annual fees from accumulating.
Do I need a business licence in addition to the LLC? Possibly. An LLC is a legal structure, not a business licence. Depending on your state, city, and industry, you may also need a general business licence, professional licence, or local operating permit. Check your state's small business portal and your local municipality's requirements after forming the LLC.
IRS – Apply for an Employer Identification Number (EIN) Online: https://www.irs.gov/businesses/small-businesses-self-employed/apply-for-an-employer-identification-number-ein-online
U.S. Small Business Administration – Register Your Business: https://www.sba.gov/business-guide/launch-your-business/register-your-business
IRS – Limited Liability Company (LLC): https://www.irs.gov/businesses/small-businesses-self-employed/limited-liability-company-llc
SCORE – Operating Agreement Template and Guide: https://www.score.org/resource/blog-post/what-llc-operating-agreement
California Secretary of State – LLC Formation: https://www.sos.ca.gov/business-programs/business-entities/starting-a-business/limited-liability-company
New York State Department of State – LLC Publication Requirement: https://dos.ny.gov/limited-liability-company-0
Nolo – How to Form an LLC: https://www.nolo.com/legal-encyclopedia/form-llc-limited-liability-company.html
