How to Form an LLC in Vermont

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Last Updated: May 4, 2023 References

Forming an LLC is easy in Vermont. All you need to do is choose an appropriate business name and then file Articles of Organization with the state. After you are approved, you should obtain necessary business licenses and tax IDs. By operating as an LLC, you will be shielded from personal liability for any business debts or obligations.

Part 1

Part 1 of 3:

Picking Your Business Name

1
Brainstorm ideas. Choose a business name that consumers will remember. Many people use their last name, but that’s not always the best idea. For example, “Smith Auto Repair” is kind of generic. It does a good job conveying the service you provide, but conjures up no other images.
- By contrast, “In-and-Out Body Shop” conveys that you provide speedy service.
- “Repairs on a Dime” tells consumers that you will offer low prices for repair work.
2
Include an appropriate designation. You need to let the public know that you are a limited liability company. Accordingly, your name will need a certain designation at the end, such as the following:^{[1]
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- limited company (you may abbreviate limited to “Ltd.” and company to “Co.”)
- limited liability company
- LLC or L.L.C.
- LC or L.C.
- the word “Professional” with one of the above designations, if you are creating a professional limited liability company (e.g., “PLLC,” “P.L.L.C.,” etc.)
- L3C if you are a low-profit limited liability company
3
Check if the name is available. You can’t use a name if another business is already using it. You can check if a name is available by using the database at the Secretary of State’s website: https://www.vtsosonline.com/online/BusinessInquire/. Click on “show me similar sounding business names” for a comprehensive search.
- Also check if the URL is available. If you want a website, then the URL should ideally be your business name. You can find if the URL has been taken by using the GoDaddy domain name search.^{[2]
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4
Reserve your name. Unless you are immediately forming your LLC, you should consider reserving the name. You can reserve a name for up to 120 days for a $20 fee. You can apply to reserve the name online or by completing a form, which you can download.^{[3]
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- To reserve online, visit the Online Business Service Center here: https://www.vtsosonline.com/online/Home/Acknowledgement. You’ll need to create an account if you are a first-time user. Pay your fee using a major credit card or an e-check.
- If necessary, you can extend your name reservation for an additional 240 days.
5
Consider registering your trademark. You can register any trademark or service mark that you use with your business. Register your name and a logo with the United States Patent and Trademark Office.
- Registration is optional. You’ll have the right to use your mark once you use it in connection with the sale of your goods or services.
- However, registration provides added benefits. You can sue in federal court if someone uses your mark without permission. The registration also serves as proof that you have a valid mark that you can use nationwide.^{[4]
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  United States Patent and Trademark Office
  U.S. government agency responsible for registering and protecting patents and trademarks
  
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Part 2

Part 2 of 3:

Filing Articles of Organization

1
Decide which type of LLC you will form. Vermont gives you three choices. Consider which one is appropriate for you:^{[5]
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- Domestic LLC. Most people will form this type of LLC.
- Professional LLC. This form is reserved for certain licensed professionals operating a business, such as legal, financial, health care, and real estate professionals.
- Low-Profit LLC (L3C). An L3C is a for-profit/nonprofit hybrid. It can make a profit, but it cannot be significantly focused on producing income. Instead, it furthers an educational or charitable purpose and is neither political nor legislative.^{[6]
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  Research source} If you are interested in forming an L3C, consult with an attorney.
2
File online. Vermont prefers that you file your Articles of Organization online. You can do so at the Secretary of State’s website.^{[7]
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- It costs $125 to file. You can pay using an electronic funds transfer or a major credit card (Visa, MasterCard, American Express, or Discover).
- If you file online, it generally takes less than a day to process your application.^{[8]
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You can also submit a paper copy of the Articles of Organization, though it will take longer to process (about seven to ten business days). Download the form here: https://www.sec.state.vt.us/media/537849/llc-1-d-_domestic_reg.pdf.
4
Provide requested information. You can type your information directly into the form and then print it off. The form asks for the following information:^{[9]
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- business name
- type of LLC you will form
- business description of your primary services
- designated office address
- name and address of your registered agent (a member or manager of the LLC qualifies as an agent)
- name and address of each member or manager
- effective date of the articles
- name of the organizer who is submitting the articles
- organizer’s signature
5
Submit your form. You must submit two copies. Also keep a copy for your records. Make your check or money order payable to “VT SOS” for $125.^{[10]
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- You can mail or hand deliver your forms to Vermont Secretary of State, Corporations Division, 128 State Street, Montpelier, VT 05633-1104.
- Unfortunately, you can’t email or fax the form.
If you run into trouble and need to ask a question, you can call 802-828-2386. Alternately, you can send an email to corps@sec.state.vt.us.^{[11]
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Part 3

Part 3 of 3:

Completing Other Business Requirements

1
Write your operating agreement. An operating agreement outlines how your LLC will be managed and how decisions will be made. You are not required to file an operating agreement with the Secretary of State. However, you will benefit by drafting one. Include the following:^{[12]
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- each member’s ownership percentage
- each member’s voting rights
- the duties of each member
- how profits and losses will be split by the members
- rules for holding meetings and taking votes
- rules for the management of the company
- policies for buying a member’s interest if they want to sell or if they die
2
Obtain tax IDs. You’ll need some tax identification numbers so that you can remit taxes to the government. For example, get the following after your Articles of Organization have been approved:
- Employer Identification Number (EIN). You can get this number from the IRS.^{[13]
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  Internal Revenue Service
  U.S. government agency in charge of managing the Federal Tax Code
  
  Go to source} You won’t need it if you are a one-member LLC with no employees. However, if you have employees or have more than one member, then get the EIN.
- State tax numbers. You may need to pay taxes to the state if you collect sales taxes or if you have employees. You can register with the Vermont Department of Taxes at their website.^{[14]
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  Research source} Look for the link under “For Businesses and Corporations.”
- If you have employees, then register for Vermont Unemployment Insurance Tax through the Department of Labor.
3
Get required business licenses. You may need state or local business licenses, depending on your circumstances.^{[15]
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- Also visit the state’s website for a list of required professional licenses.^{[16]
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4
File an annual report. Vermont requires LLCs to file an annual report within three months of the end of their fiscal year. If you are a domestic LLC, you must pay $35. If you are a foreign LLC doing business in Vermont, you pay $140.^{[17]
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- You can file online at the Online Business Service Center.
- If you want to pay with a paper check, you still must complete the information online but then select this option at the end.^{[18]
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File a “Certificate of Authority Application” if you are an LLC formed outside of Vermont and want to operate in the state. You’ll need to appoint a Vermont resident as your agent. The filing fee is $125.^{[19]
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