How to Start an LLC in Arkansas

Last updated: March 18th, 2024

Starting a new business is a complex process, with many important steps to consider. Even just the paperwork involved in actually forming a business entity like an LLC can be intimidating. If you’ve decided to start an LLC, this is the guide for you. It will detail how to start an LLC in Arkansas, from start to finish.

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Limited liability companies, or LLCs, are a popular choice for Arkansas entrepreneurs. This is largely due to their personal liability protections. If your LLC is sued, your personal assets are protected from that lawsuit. In other words, you are considered a separate entity from your business.

 

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Consider using an LLC service

If you follow the steps in this guide, you can form an LLC in Arkansas on your own. With that said, it’s much easier to use an LLC service, like ZenBusiness and Northwest Registered Agent. These companies can help walk you through the process of getting your company off the ground.

Using a professional service ensures that each step is handled efficiently and accurately, and frees up more of your time to focus on core business operations. LLC services are inexpensive – ZenBusiness’ plans start at just $49 + Arkansas’ state fee. If you value your time, using these services is definitely worth the cost.

Also, these companies can serve as your Registered Agent (called an Agent for Service of Process in Arkansas). Every LLC in the state must appoint a Registered Agent (see Step #3 below), and these companies offer an inexpensive and professional service for this.

Recommended services

The focus of ZenBusiness is on forming new companies. They help simplify the process of starting a business, using powerful online tools. ZenBusiness plans are ongoing and help customers grow their businesses. They provide many services and resources, and can also help connect entrepreneurs to other relevant services.

See the full ZenBusiness review here

Northwest Registered Agent will scan all documents you receive for your business so that you can easily see them in your online account. There, you’ll have unlimited cloud storage as well as strong business data protection, and help from their friendly customer service staff when you need it. A yearly subscription for their registered agent services costs $125.

See the full Northwest review here

Bizee specializes in new company formation. With Bizee, you can form a new LLC, corporation, or other business entity in your state. So far, they have helped form more than 500,000 new businesses. Bizee works directly with each US state to help start new businesses. Essentially, they are a middleman between you and your state’s business department.

See the full Bizee review here
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Name your Arkansas LLC

The first concrete step to take is to find an available name for your LLC. The name must be distinguishable from other company names in the state. You can search the Arkansas Business Name Database to confirm that your name is available.

The name you choose must also meet a few requirements:

  • It must contain the words ”Limited Liability Company,” or “Limited Company”
  • Abbreviations are also allowed: “L.L.C.,” “L.C.,” “LLC,” or “LC”
  • The word “Limited” may be abbreviated as “Ltd.,” and “Company” may be abbreviated as “Co.”
  • Professional services companies must use the phrase “Professional Limited Liability Company,” or “Professional Limited Company,” or abbreviations like “P.L.L.C.,” “P.L.C.,” “PLLC,” or “PLC”

Once you find an available name, you can reserve it by using this form ($25 fee), or reserve it online ($22.50).

Using a fictitious business name in Arkansas

Arkansas allows for the use of “fictitious” business names, otherwise known as trade names or DBA (doing business as) names. What this means is that you can do business under a different name than your actual LLC name. For example, “Little Rock Automotive, LLC” could have fictitious business names like “Little Rock Rock Chip Repair”, or “Modern Mechanics”.

To get a fictitious business name, you must simply file this form with the Secretary of State, or file online. The cost is $22.50 for online filings, or $25 for mail filings.

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Appoint an Arkansas registered agent

Every LLC in the state of Arkansas must appoint what is called an Agent for Service of Process. In most other states, this is referred to as a Registered Agent.

An Agent for Service of Process is tasked with receiving notice of lawsuits and other important legal documents for your business. They are essentially the public-facing contact point for your company.

This agent must be either:

  • A full-time resident of Arkansas
  • A company licensed by the Secretary of State to do business in Arkansas

If you live in the state, you can be your own agent, or you can appoint an employee. However, keep in mind that the mailing address used will become public information.

Alternatively, you can use a registered agent service. Both ZenBusiness and Northwest Registered Agent operate in Arkansas and offer low-cost services.

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Draft an operating agreement

Note: This is an optional step, but it’s recommended for most businesses. You do not need to submit an operating agreement to Arkansas; it’s just an internal document for your own records.

An operating agreement is a legal document that lays out key details about your business. Most notably, it details the ownership structure of your new company. For multi-owner businesses, this is key, as it helps prevent future conflict.

The best way to draft an operating agreement is to use the help of an LLC formation service, like ZenBusiness and Northwest Registered Agent. They will offer templates and guidance on how to draft an agreement. Alternatively, you can use the services of a lawyer.

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File Articles of Organization

The main document that needs to be submitted in order to form an Arkansas LLC is the Articles of Organization (Form LL-01). This document can be found here for download. Alternatively, you can submit the document online.

The Articles of Organization collect the foundational information about your new company and distinguish key decisions like its management structure, mailing address, Registered Agent, and more.

The Arkansas LLC fee is one of the lowest in the nation: Just $45 if filed online, or $50 if filed by mail. Many states have fees in the hundreds of dollars, so Arkansas is certainly business-friendly with its cost structure.

Note: These steps are for registering a new domestic LLC in Arkansas. To register an Arkansas foreign LLC (for an existing company looking to expand into the state), you’ll need to file the Application for Certificate of Registration of Foreign Limited Liability Company.

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Wait for your documents

Once you have filed the Articles of Organization, you’ll need to wait for Arkansas to process the application. This can take up to 2-3 weeks, although it’s often quicker, particularly if you submit the form online.

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Apply for an EIN

An EIN, or employer identification number, is a federal tax identification number. It’s like a social security number for your business. This number is required to hire employees, and it’s also useful for tasks like opening a business bank account. Once you have your EIN, this is also the number you will use on federal business tax returns and other key filings.

You can file for an EIN online at the Internal Revenue Service’s website. This is handled by the IRS, not Arkansas’ state government, as it’s a federal tax ID number.

There is no cost to obtain an EIN, and the application takes just a few minutes.

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Apply for business licenses, permits, etc.

The Articles of Organization will establish your LLC and provide a state tax ID number. However, you will most likely need a business license on the local level (city or county), and you may also need other licenses or permits. Check with your local city/county government for details.

Also, if you plan to provide professional services, you may need specialty permits or licenses.

These are the basic steps you’ll need to take in order to start an Arkansas limited liability company. Beyond the initial formation, however, there are a few more considerations to keep in mind.

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Keep your business in good standing

With any business, there are various tasks that will need to be addressed on an ongoing basis. This includes tax filings, permit renewals, and other key requirements. Some things to keep in mind include:

  • Annual Franchise Tax report (state-level, $150 minimum per year)
  • Annual State Business Tax Report
  • Annual federal tax reports
  • City, state, and county-level tax reports (in certain areas)
  • Employer taxes (payroll taxes)
  • Sales and use taxes
  • Permit renewals
  • Business license renewals
  • Federal tax filings
  • Keeping an Agent for Service of Process (registered agent) for the life of your company

This can all seem overwhelming at first, but it’s wise to stay on top of requirements from day one. To ensure you never miss a key filing, it’s a good idea to add key dates to your calendar to remind yourself.

That’s all you need to know about starting a business in Arkansas! With the right foundation, you will be well on your way to the business of your dreams.

About BOI Reports…

To legally operate an LLC, owners need to understand BOI reporting laws from the Corporate Transparency Act and provide accurate owner details to the Financial Crimes Enforcement Network (FinCEN) to avoid penalties. Find out more about BOI reporting here.

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Open a business bank account

Keeping your personal and business finances separate is key to your accounting efforts and long-term success. You’ll certainly want a separate bank account for your company. To open one, you’ll typically need to show a business license in the state, as well as an EIN or other tax ID.

Most banks and even small credit unions offer business checking accounts, so it should be easy to find a good option in your area.

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