Why Create an Iowa LLC?
The state of Iowa offers various opportunities for tax credits and exemptions for businesses, provided your LLC meets the specific criteria. The state of Iowa has also implemented an interesting Sales Tax Holiday. This holiday gives businesses selling clothing and footwear a period of time every year where they are exempt from charging a sales tax or local option tax. From 12:01am on the first Friday of August until 12:00am the following day, businesses are exempt from charging sales or local option taxes on clothing and footwear items valued at $100 or less.
Creating an Iowa limited liability company (LLC) is generally the fastest and easiest way for entrepreneurs to start a business in Iowa. An LLC is an ideal business entity for startups and small to medium-sized businesses, granting you the advantages and protections that larger Iowa corporations benefit from, with more simplified rules and regulations.
Benefits of starting an Iowa LLC:
Protects your personal assets from your business liability and debts
Easy tax filing and potential advantages for tax treatment
Create, manage, regulate, administer and stay in compliance easily
Low cost to file ($50)
Learn more about the benefits of the LLC business structure.
In this guide, you’ll find information on naming your LLC, getting a Registered Agent, the fees you’ll need to pay, Iowa business taxes and much more. We also cover your registration needs, filing your Iowa LLC and how you'll correspond with the Iowa Secretary of State (SOS).
How to Form an LLC in Iowa Yourself in 6 Steps
Complete an Iowa LLC Search and Choose a Unique Business Name
You’ll need a name for your LLC that’s original and stands out, but one that’s not used by any other formed business or incorporation in the state. If you’re having trouble coming up with a name, try using Incfile’s Business Name Generator to brainstorm ideas. You'll also need to follow a few naming rules, which you can read about in detail on the Iowa Business Names page.
Once you’ve chosen a name, you’ll need to make sure it’s available in Iowa. To find out whether another company in the state is already using your preferred business name, use our tool to do a business name search. You can also carry out a name search on the Iowa Secretary of State online database.
Provide an Official Business Address for Your LLC
Regardless of whether your business is in an office building, a home (if the company is run from a residence) or any other physical location, every LLC in Iowa must have a designated street address. It can be located outside the state of Iowa, but it cannot be a P.O. Box.
Assign a Registered Agent
A Registered Agent is someone who receives official legal and tax correspondence and is responsible for filing reports with the Iowa Secretary of State. Every LLC in Iowa is required to have a Registered Agent.
This position can be filled by you, another manager in your business or a dedicated Registered Agent service. If your Iowa Registered Agent is a person, they must have a physical street address in Iowa and must be present during business hours to receive important documents on behalf of your company. In Iowa, you appoint your Registered Agent when you file your Certificate of Organization and formally create your business.
All of Incfile’s packages include Registered Agent service. It’s free for the first year and just $119 per year after that. You can also log in to our dashboard and easily view any document we've received on your behalf.
File Your Certificate of Organization with the Iowa Secretary of State
Once you've gathered all the information for your Iowa LLC, you’ll need to file a certificate of organization with the Iowa Secretary of State.
Your Certificate of Organization can be filed online by using a Fast Track Filing system. The Iowa Secretary of State has set up this system for all business entity filings, so you’ll need to create an account to file any business related forms and documents. The Iowa LLC filing fee is $50.
You only need to file your Certificate of Organization once, but you must file a biennial report every odd year, as dictated by Iowa Legislature. The fee for this, set by the Iowa SOS, is $60. Incfile can either remind you to do it, or we can do it for you.
What are the fees and requirements to form a business in Iowa?
between January 1 and April 1 of the first odd-numbered year following the calendar year
in which an LLC was formed
Get an Employer Identification Number (EIN) from the Internal Revenue Service
You’ll need an EIN to identify your business to the IRS. You use this number when filing and paying taxes or when submitting payroll information and payments for your employees. An EIN is also required to open a business bank account. You can obtain one directly from the IRS, or you can have Incfile obtain one for you as part of the Iowa LLC formation process.
Create an Operating Agreement
A kind of "instruction manual" that explains how you'll run your business, an LLC Operating Agreement details key components of your business - how decisions will be made, how the business is divided among members and what will happen if a member leaves the company.
Although some states require that a company have this document in place, you're not legally required to have an Iowa LLC Operating Agreement. We think it’s still a good idea to have one regardless.
Other Iowa LLC Types
Professional Limited Liability Companies (PLLCs) are different from professional corporations in that they typically have licensing requirements applicable to certain fields, such as law and medicine. In order to form a PLLC, you may need a state license to practice.
Learn more about PLLC vs. LLC and which one is right for your business.