How to Start an LLC in Nevada
Starting a new company can certainly feel intimidating. While simple business structures like sole proprietorships can be started in just a few minutes, more complex companies like LLCs can take more effort, and more paperwork. This guide will look at starting an LLC in Nevada, helping guide you through the entire process.
A limited liability company (LLC) is a popular business structure, and for good reason. Among other benefits, it provides liability protection for owners by helping to protect the owner’s personal assets from liabilities created by the business. For instance, if an LLC gets sued, the courts can go after the business’ assets, but not the owner’s personal assets. In this way, an LLC creates a separate entity from the owner, whereas a sole proprietor directly ties the owner to the business.
Nevada has relatively straightforward regulations relating to new LLCs. If you live in the state, opening a limited liability company can be done online. This guide will explain how to form an LLC in Nevada step-by-step.
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Consider using a Nevada LLC service
Some business owners may benefit from using a professional incorporation or LLC service to help get the new company formed. These companies act as middlemen between you and the Nevada government, and basically streamline the process to start an LLC.
These companies are not strictly necessary, as you can do the entire process on your own. But they can certainly save you time and hassle, while ensuring that everything is done correctly. Most also offer a registered agent service (see step #3).
There are many LLC formation service providers, but some good budget-friendly options include ZenBusiness and Bizee. These companies will charge a small fee, on top of Nevada’s own state fees, to help guide you through the registration process.
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Choose a business name
Next, it’s time to name your new LLC. This is an important step, and Nevada does have some distinct rules to keep in mind:
- The LLC name must contain the words “Limited-Liability Company,” “Limited Liability Company,” “Limited Company,” or “Limited.”
- Abbreviations are also acceptable, including “LLC”, “Ltd.,” “L.L.C.,” or “LC.”
- The LLC name must be distinct from any already established company in the state.
- You can use the Silverflume business entity name search feature to confirm that your name is unique.
- If you’re not sure about your name, you can reserve a name for 90 days for a fee of $25.
Choosing a business name is an important step, and it’s required to move forward with the registration process. However, it may not be as key as you may think, because of the option to use trade names.
Using a Doing Business As (DBA) or trade name
This LLC name will be the full legal name of your business, but doesn’t necessarily need to be the name you actually do business as. This is because LLCs can obtain “Doing Business As” names (DBA). These are essentially add-ons to a state business license that allow you to operate under different names. For example, an owner of several restaurants may have a single LLC with one name, yet operate under the unique restaurant names.
While the name of your LLC is selected during the initial LLC registration process with the state, the selection of DBA or trade names occurs on the county level. This can be done when you request a business license, or at any point you wish to add a new trade name. Each county has a slightly different process and fee structure – see this resource for a list of Nevada counties.
Appoint a registered agent
Under Nevada law, a registered agent is required for every business in Nevada. This is an individual or company appointed for service of process, or in other words, the registered agent is there to accept legal documents should the company be sued. A registered agent is required for every business entity other than a sole proprietorship.
You can be your own registered agent, or you can appoint an employee or a third-party service. The requirements are simple: The registered agent must be a resident of Nevada, or a company licensed to do business in the state. The agent must also have a physical street address that can be listed on the business registration. This address will become public record, so keep this in mind if you wish to protect your privacy.
If you use a registered agent service, your personal address will be protected from public view. You’ll also be less likely to miss an important document. A registered agent service is fairly affordable, often costing $50 to $150 per year.
Prepare an operating agreement
An LLC operating agreement is an internal document (meaning that it’s not filed with any government agency). As such, it’s not required in the state of Nevada. However, most LLCs should still prepare one.
The operating agreement is essentially a detailed legal document that establishes the operating procedures and ownership structure of a new LLC. It is very important for multi-member LLCs, as it establishes ownership rights. Even for single-member LLCs, the document can still be useful.
You can use the services of an attorney to draft an operating agreement, although this can be costly. Most LLC services offer the option to establish an operating agreement, which will likely be much cheaper than hiring help from a lawyer. Alternatively, you can find operating agreement templates online to fill out for free.
File Articles of Organization
The official document that establishes a new LLC is the Articles of Organization. The form, and a packet explaining how to apply, can be found here.
The extensive form must include:
- LLC’s name
- The information of the LLC’s registered agent (name, address, signature)
- A signed Certificate of Acceptance of Appointment by the registered agent
- The LLC’s dissolution date
- Whether the LLC is member-managed or manager-managed
- The names and addresses of each manager or managing member
- The name, address, and signature of the LLC organizer (you)
There are three ways to file this form.
- You can print out a copy, fill it it, and submit it by mail to the Nevada Secretary of State
- You can file online using Nevada’s Silverflume business portal
- You can use an LLC service if you want help filling out the form and other documents
The filing fee for the Articles of Organization is $75, whether you file online or by mail. Third-party services will add additional fees. A full fee structure for Nevada LLCs can be found here.
During this process, you will also apply for a state business license at the same time. The cost for this is $200 per year.
Wait for your documents
Now, it’s time to simply wait for your application to be processed, and your business formation documents to be mailed to you. The NV Secretary of State is the agency tasked with processing business applications, and their process is fairly quick – although it depends on how busy they are.
Processing can take anywhere from 5 to 12+ business days once your documents have been received. You may be able to pay extra to have your application expedited. If there are any issues with your application, you will need to correct them and potentially re-submit your application.
Obtain an Employer Identification Number (EIN)
An EIN is a federal tax identification number obtained through the IRS. You can file for an EIN online at the Internal Revenue Service’s website. The process is free and only takes a few minutes.
An EIN will allow you to hire employees, get a business bank account, and more. This is a federal number, and has little to do with the state of Nevada – but it’s very important for all businesses to obtain one.
Once you have your EIN, you’ll use this number on most or all federal tax forms. You will also be asked for it by financial institutions that you work with, and even clients who are filling out tax forms like 1099’s.
File a Common Business Registration
If you use the Silverflume portal to start your LLC, you’ll also be asked to file a Common Business Registration. This is the process you go through to get registered with the Nevada Department of Taxation, the Worker’s Compensation department, and other key agencies. Fortunately, it’s all handled in one online application via Silverflume.
This process also includes some local business licensing (although you may need to fill out additional forms). Basically, the Common Business Registration process is a way to cut down on redundant forms. Instead of filing separately with a dozen different agencies, Nevada’s system allows you to file a single application to satisfy the requirements of several different state agencies.
You will be walked through this process during the registration process. It mostly just requires basic information, such as your name and address.
Keep your business in good standing
Forming an LLC is just the first step. You will need to file forms and tax returns routinely in order to keep your company in good standing with state, federal, and local agencies. For instance, you’ll need to collect sales tax and deliver it to the state, and you’ll need to file federal and state income tax returns for your business.
This means staying on top of tax returns, filing annual reports, and any other small business filings required by law. Nevada business tax, income tax, and annual report forms must all be filled yearly. You may also have quarterly filing requirements, for both state and federal taxes. There may be permits to be renewed, and various other regulatory requirements to satisfy.
It can seem like a lot, but the best thing to do is to start off on the right foot. Research all your ongoing compliance requirements, and add reminders to your calendar now so that you don’t forget.
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.
Open a business bank account
For accounting purposes, it’s important to keep your business and personal finances separate. To do this, you should open a business bank account immediately. You’ll likely need an EIN for this process (see #7).
You can choose to open an account with a bank that you already have an account with, or you can shop around for the best bank for your needs. The point is to keep things completely separate from your personal bank account.
How much does it cost to form a Nevada LLC?
For most new LLCs in the state, the total cost will be $425. This includes $75 for the Articles of Organization, $200 for a state business license, and $150 for the Initial List of Managers or Managing Members.
After the first year, ongoing costs will be around $350 per year. That’s $200 for the renewal of the state business license, and $150 for the list of managing members, which must be filed annually. Additionally, you may need to pay for a registered agent (usually $50-$150 per year) if you choose to hire a registered agent service.
Keep in mind that there may be additional costs, depending on the type of business and your location. For instance, you may need a specialized permit for certain activities, or the county/city you operate in may have additional fees.
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