How to Form an LLC in Idaho

Co-authored by Clinton M. Sandvick, JD, PhD

Last Updated: January 31, 2023 References

A limited liability company (LLC) offers business owners a certain level of legal protection from personal liability for business debts and claims.^{[1]
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Research source} You can form an LLC in the state of Idaho under the State's Statute 30-6-201, known as the Idaho Uniform Limited Liability Company Act.

Part 1

Part 1 of 3:

Preparing to Form an LLC

1
Select the name of Your LLC. You'll have to select a name that's not in use. You can check to make sure that the name of your LLC is not in use with the LLC Search Tool. Keep in mind that one of the following terms must be in the name of your LLC.
- "Limited Liability Company"
- "Limited Company"
- "L.L.C."
- "LLC"
- "LC"
2
Decide on who the members of your LLC will be. The owners of an LLC are called "members." They're the people who have a financial interest in the company that goes well beyond the interest of an employee or a customer.
- LLC membership isn't limited to people. Members can include partnerships, corporations, trusts, estates, or other LLCs.
3
Select a manager for the LLC. A manager is effectively the chief executive officer (CEO) of the company. He or she is the one who will set the strategic direction of the company and oversee day-to-day operations from an upper management perspective.
- You can have a member-managed LLC. That means the members of the LLC actively manage business operations. That's usually a great option for single-member LLCs.
- Alternatively, you can set up a manager-managed LLC. That means you'll hire someone else to manage the manage while you act as a passive investor.^{[2]
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An operating agreement is written to cover the economic and governance structure of your LLC. It's akin to having articles of incorporation, bylaws, and shareholder agreements wrapped into one document. It may even include a statement of social purpose.^{[3]
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5
Select a registered agent. A registered agent is a legal representative in the state who can receive legal notices for the business on your behalf. You can be the registered agent for the LLC if you live in the state of Idaho. Otherwise, you're going to need to find someone else to be a registered agent on your behalf.
- You can simply Google "Idaho registered agent" to find a list of registered agents available for that state.
- Remember, there is a fee associated with using a representation service. You'll also have to gain the consent of representation before you can list another party as your registered agent.
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Part 2

Part 2 of 3:

Forming the LLC

You'll find an online form that you need to complete at the Secretary of State's Site.
Unlike some other states, Idaho doesn't allow you to fill out the form online. Instead, you'll need to print out the form (it's in PDF format) and fill it out with a pen.
3
Fill out the required information on the form. Most of the required information on the form is self-explanatory. Be sure to fill it out completely or you might delay the process.
- The form also includes instructions about what information is required for each section.
- Remember, the name of the LLC must follow the specifications mentioned above.
You'll need to write out a check for the filing fee. As of this writing, that's $100.
The address for the Secretary of State is located at the bottom of the instructions that are included with the form. Be sure to include your payment when you mail it in.

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Part 3

Part 3 of 3:

Meeting Financial Requirements

1
Apply for an EIN Number. Your business is a separate legal entity. As such, it will need its own tax ID or Employer Identification Number (EIN). Apply for a EIN Number from the IRS.
- If you own and operate a sole member LLC, which means you are the only person managing and working for the LLC, you do not need an EIN.
2
Determine your tax obligations. There are a variety of taxes associated with operating a business in Idaho.
- Business tax - In Idaho, your income (revenue minus valid business expenses) is taxed at 7.4%.^{[4]
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- Property tax - If your business owns real estate, you'll be subject to local property taxes. The state tax commission sets property taxes based on the assessed value of the property.
- Payroll taxes - If your business has employees, you'll need to withhold taxes at both the state and federal level. Fill out an IBR for withholding state taxes from your employees.^{[5]
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  Research source} The IRS has detailed information about how to withhold and pay federal payroll taxes.^{[6]
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  Internal Revenue Service
  U.S. government agency in charge of managing the Federal Tax Code
  
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3
Budget for the regulatory environment. You'll also need to spend money to satisfy certain regulatory requirements. Be sure to account for that in your annual budget.
- The minimum wage in Idaho is $7.25 per hour.
- Idaho state law requires you to have workers' compensation insurance even if you have only one employee.^{[7]
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  Research source} That's insurance that covers your employees in the event that they get hurt on the job.
- Be sure to understand specific regulatory requirements for your particular business model and how they'll impact your bottom line.^{[8]
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You're definitely going to want a bank account separate from your own personal account to track business expenses and income. To open a business account, you'll need your EIN and a copy of your filed Certificate of Organization.

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Need to be at least 18 years old.

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Highly recommended to have a LLC Operating Agreement.

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