An Idaho LLC is a legal business structure that protects your assets (like your home, car, and bank account) in case your company gets attacked.
An LLC can be used to run a business or hold your assets, like real estate, cars, boats, and planes.
A. Idaho LLC Name
Before you file the Certificate of Organization for your Idaho LLC (the document that makes your LLC official), you’ll need to check the state’s database to see if the name you want to use is free. This is called “distinguishable.”
Your Idaho LLC’s name must be different and unique from all the other businesses already listed in the state.
LLC Designator: Idaho’s Business Organizations Code, Section 30-21-301, says that your LLC’s name must end with a proper designator. In Idaho, you can do the following:
* LLC (most popular)
* LC
* Ltd. Company
* “Limited Company” and “Limited Co.”
Your Idaho LLC name can’t include a word that makes it sound like a different kind of legal organization. For example, you can’t use Inc., Incorporated, Corporation, or any other term that isn’t on the list above.
Reserving a name for an LLC: You don’t have to do this step to make an LLC. Most people don’t really need to do it.
Too many people rush through the process of forming an LLC, and then they want to change the name of their Idaho LLC later on. You can file an Amendment and change your LLC’s name with the state in the future, but you’ll also need to tell the IRS, the State Tax Commission, your bank, your debit/credit cards, your suppliers, your website, your business cards, online registrations, and more. To put it simply, it’s a huge pain.
B. Idaho LLC Registered Agent
An Idaho Registered Agent is a person or company that is authorized to get notices from the state and legal mail (called “Service of Process”) sent to your LLC in case it is involved in a legal proceeding.
Your Idaho Registered Agent must have a real street address in the state, not a PO Box or rented mailbox. This is so that Service of Process and other documents can be sent to them.
Registered Agent for Businesses: We suggest Northwest Registered Agent ($125 per year) if you want to hire a Commercial Registered Agent in Idaho.
C. Idaho LLC Organization Certificate
The Idaho Certificate of Organization is the form you will file with the Secretary of State to make your LLC legal.
The fee to form an LLC in Idaho: $100 (one-time fee).
Various ways to file: You can start a limited liability company (LLC) in Idaho by mail or online. The state prefers online filing, and the process is much easier.
File your Idaho LLC online: You need to sign up for a SOSBiz account.
Idaho LLC approval: After you file for your LLC, it will be approved in 5 to 7 working days. Once your LLC is accepted, the Idaho Secretary of State will send you an email with a stamped Certificate of Organization and a receipt for filing.
D. Operating Agreement
An Idaho LLC Operating Agreement is a contract between the LLC Members that is written down. that says who owns the LLC and how much of it they own. The Operating Agreement for your Idaho LLC will also show how the business is run, how gains are split, how taxes are paid, and more.
In Idaho, both Single-Member LLCs and Multi-Member LLCs should have an Operating Agreement.
Having an Operating Agreement of your Idaho LLC helps show that the business is a separate legal body. from you. This helps keep your LLC’s safety of your personal assets in place and is very helpful if you find yourself in court.
Internal Document: An LLC Operating Agreement is a internal document, which means you don’t have to send a copy to the Secretary of State, the Tax Commission, the IRS, or any other government body. You only need to keep a copy of the Operating Agreement with your LLC business records. if necessary, give a copy to the other LLC Members.
E. Get an EIN number for your Idaho LLC.
After your Idaho LLC is accepted by the Secretary of State, you can get an Idaho EIN Number from the IRS.
An EIN is also known as an Employer Identification Number, FEIN, Federal Employer Identification Number, or Federal Tax ID Number. All of them have the same meaning.
You can think of the EIN Number for your Idaho LLC as its “social security number.” It helps the IRS figure out who your LLC is for tax and filing needs.
Your Idaho LLC’s EIN will also be needed when you open a bank account for your LLC, file it with the Tax Commission, and, if you have employees, pay them.
How is an Idaho LLC taxed: The IRS doesn’t have a specific tax classification for LLCs. Instead, an Idaho LLC can be taxed in 4 different ways. Two of these are automatic (they happen when you get your LLC’s EIN), while the other two require a special election (you have to file a form after getting your LLC’s EIN). Before filing for an EIN, you should read how an LLC is taxed.
Wait for approval of the LLC: Don’t file for an EIN until the Secretary of State has given your Idaho LLC. It’s OK.
An EIN costs nothing ($0): The IRS will give your LLC a free EIN.
LLC with a husband and wife: If you and your spouse start a 2-Member LLC in Idaho, you can be considered a Qualified Joint Venture. This means that a 2-Member LLC owned by a husband and wife can be treated as a Sole Proprietorship instead of a Partnership.
When you apply for an EIN for your Idaho LLC: this person will be the “contact person” for the IRS. You will be the Responsible Party if you have a Single-Member LLC. If you have an LLC with more than one member, any member of the LLC can be the Responsible Party.
How to apply for an EIN: Your Idaho LLC can apply for an EIN in three ways:
- You can apply for an EIN online if you have an SSN or an ITIN.
- If you try to get an EIN online and get an error message, you’ll have to use Form SS-4 to get an EIN instead.
- You can still get an EIN for your LLC even if you don’t have an SSN or ITIN. Here’s how: how to get an EIN without an SSN or ITIN
F. Annual Report of the Idaho LLC
Every year, all LLCs in Idaho must file an Idaho LLC Annual Report.
Fee for the annual report: $0 (it’s free).
The goal of the Annual Report is to make sure that the Idaho Secretary of State has the most up-to-date information about your LLC.
Penalty: If you don’t file your LLC’s Annual Report, the Idaho Secretary of State can shut down your LLC automatically.
Due date: Every year, your Idaho LLC Annual Report is due by the end of the month that your LLC was formed. The month your LLC was formed is the anniversary month. And your first Annual Report is due the year after you start your business. For example, your anniversary month is June if your LLC was accepted on June 10, 2023. So, the deadline for your first Annual Report is June 30, 2024. Then it will be due every year by June 30.
Don’t send any more postcards: The Idaho Secretary of State will no longer send out postcard notes after the end of 2018. Every year, it will be up to you to file your Annual Report through your SOSBiz account.
How to submit: Through SOSBiz, you can file your Annual Report online. Click “My Records” and then “File Annual Report” to get started.
G. Licenses and permits for a business in Idaho
Depending on where your Idaho LLC is and what it does for business, you may also need to get a business license and/or permit.
Business.Idaho.gov: Licensing and Permits is the official Idaho Business page where find out what licenses and permits your business needs.
On the official State of Idaho website, Idaho.gov: Online Services Professional Licence, you can look at the rules for getting a professional license.
You’ll need to call your local county, city, town, etc., and ask about any local or municipal licenses or permits.
H. State Taxes in Idaho
Idaho LLC Taxes are different for every small business, but we can give you a general idea of what you need to do.
Tax on income: Usually, there are three ways to pay income taxes:
* Federal
* State
* Local
Federal income taxes: By default, an Idaho LLC is a pass-through company. This means that the LLC’s profits and losses flow through to your personal tax return.
- If you have a Single-Member LLC that is taxed as a Sole Proprietorship, you will probably show your business income on a Schedule C as part of your personal 1040 return.
- If you have a Multi-Member LLC that is treated as a Partnership, you will need to file a 1065 Partnership Return, send K-1s to each of the Idaho LLC Members, and then the LLC Members will include the K-1 income on their personal 1040 returns.
Since the IRS doesn’t have a specific way to tax LLCs, Idaho LLCs is charged based on how many Members they have. To learn more, please look at how LLCs are charged. To save money on self-employment taxes, an LLC can also choose to be treated as an S-Corporation instead of a C-Corporation.
Joint ventures that qualify: Since Idaho is a community property state, a husband and wife who own a 2-Member LLC can choose to be handled as a Sole Proprietorship instead of a Partnership by filing with the IRS for a Qualified Joint Venture election.
Getting a tax number from the state: Please look at the Tax Commission website’s page about Idaho Business Registration (IBR). This is about sales tax and any other taxes that your LLC might need to sign up for.
Sales Tax Permit: If your Idaho LLC makes retail sales, you’ll need to get a Seller’s Permit, register for sales tax, and collect sales tax. This has to do with shipping or delivering things to customers in Idaho. Check out the Business and Sales/Use Tax page on the Tax Commission website for more details.
Other tax payments and forms: Depending on the nature of your business and where it takes place, your Idaho LLC may also have to file other state and city taxes. We suggest that you work with an accountant.
Recommendation: Talk to an accountant to find out all of the tax reporting and file requirements for your Idaho LLC.
I. Bank Account for Idaho LLC
After you get an EIN from the IRS for your Idaho LLC, you can now open a business bank account in the name of the LLC.
From a legal point of view, it is important for your Idaho LLC to have a different business checking account. It protects you from personal responsibility by keeping your personal assets and the LLC’s assets from getting “commingled” (mixed together).
Having a separate business bank account for your Idaho LLC also makes it easier to keep track of records for tax and accounting reasons.
When it comes to business checking accounts, each bank has its own rules. We suggest calling ahead of time to find out the minimum initial deposit, the minimum amount needed to keep the account open, and any monthly maintenance fees.
Needed papers for an LLC in Idaho: To get your Idaho LLC a business bank account, you will need the following:
* Certificate of Organization (signed and accepted)
* EIN Confirmation Letter from the IRS
* Photo ID (driver’s license or passport)
* Operating Agreement (it may not be needed, but it’s a good idea to bring it anyway)
LLC Members: Those who want to be on the bank account for a Multi-Member LLC should be there when the account is opened.
Non-American citizens: Even if you don’t live in the U.S. and set up an LLC in Idaho, you can still open a business bank account in the U.S. Here is where you can find out more: starting an LLC bank account for people who don’t live in the US.
Charge Card: When you open the account, the bank will give you a debit card.
Bank Card: You can also get a credit card for your business to earn points, miles, and other benefits.
J. Phone Number for a Business in Idaho
Get a different business phone number for your Idaho LLC instead of giving out your personal cell phone number or home phone number.
State agencies in Idaho
Idaho Secretary of State’s
website is Idaho Secretary of State, and their phone number is 208-334-2301.
Monday-Friday, 8 a.m-5 p.m., Mountain Time
Idaho State Tax Commission
Phone: 208-334-7660 or 800-972-7660 Website: Idaho State Tax Commission
Monday-Friday, 8 a.m-5 p.m., Mountain T
