How to Start an LLC in Utah | 2024 Guide

Start a LLC in Utah

How to Start an LLC in Utah: If you’re looking to launch a business in Utah, starting a Limited Liability Company (LLC) may be the right choice for you. An LLC provides personal liability protection for its owners while giving them flexibility in managing and taxing the business. This guide provides a step-by-step process for starting an LLC in Utah. From choosing a unique name to registering with the state and obtaining necessary licenses and permits, Webinarcare Editorial Team will walk you through setting up your new business entity. So grab a pen and paper, and let’s get started!

What is a Limited Liability Company?

A Limited Liability Company (LLC) is a type of business entity that combines a corporation’s limited liability protection with a partnership’s tax benefits. LLCs are popular among small business owners for their flexibility and ease of formation. In Utah, an LLC must have a unique name and file Certificate of Organization with the Secretary of State. Depending on their business needs, LLCs may also elect to be taxed as a corporation or an S-corp. Owners of an LLC, called members, are not personally liable for the company’s debts and losses, and the company’s profits and losses are passed through to the member’s personal tax returns. This makes an LLC an attractive option for those seeking personal liability protection and simplified taxation.

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Steps on How to Start an LLC in Utah

To form an LLC for your business, you must follow the guidelines that include naming your LLC, hiring a Registered Agent, filing your Certificate of Organization, creating your LLC operating agreement, getting an employer identification number, opening a bank account and getting business licenses and permits.

Step 1: Name your LLC in Utah

After you have decided on the idea to form an LLC in Utah, deciding the name for your LLC is significant. There is a complete guide on LLC name guidelines for you to have a proper LLC business name. Here are some regulations you must follow while naming your LLC,

  • The name should not be confused with a government entity.
  • The name should be unique.
  • The name should be available to use.
  • Any other business does not use the name.
  • The new name must include “LLC” if it is a limited liability company.

In Utah, if you do not wish to file your LLC right away but want to hold the name that you have decided on, then you can reserve your LLC name for 120 days. You must file a name reservation application in Utah Secretary of State to keep the name.

Recommended: We recommend a professional service that can offer you unlimited name search, trademark and copyright registration at a reasonable price. We recommend using –

LegalZoom($0 + State Fees for LLC Formation)

You can register your business under a different legal name if your preferred name isn’t available. Once you have chosen a name, you can submit an application for filing Utah DBA (doing business as). In this manner, you can choose any name you desire for your business. A DBA allows a company to operate under the name of the person or entity who owns it. If you have decided to file for a DBA, you can file it in three methods, online, by mail, and in person filing. However, before filing a DBA, you should know that you need to renew your DBA from up to three years, which costs around $22.

Step 2: Hire a Registered Agent in Utah

Hiring a Registered Agent in Utah is a must since a Registered Agent is a person or business entity responsible for receiving important legal documents on behalf of your Utah LLC. Most states require you to designate a Registered Agent when forming your LLC.

The qualifications of a Registered Agent vary depending on the jurisdiction. Still, generally, a Registered Agent must meet the following criteria:

  • Availability: A Registered Agent must be available during regular business hours to receive and process legal documents and official correspondence.
  • Physical Address: A Registered Agent must have a physical street address within the state where the LLC is registered. This address, known as the registered office, cannot be a P.O. Box.
  • Residency or Authorization: For individuals serving as Registered Agent, they must be residents of the Utah where the LLC was formed. A business entity acting as a Registered Agent must be authorized to do business within that state.
  • Age: A Registered Agent must be at least 18 years old.
  • Good standing: A Registered Agent should not have any legal or financial issues that impede their ability to fulfill their duties.

Choosing a reliable and responsible Registered Agent is essential, as failure to receive and respond to legal documents can seriously affect your business. Some businesses use professional Registered Agent services to ensure compliance and proper handling of legal matters.

However, if you would like to have an easier process in filing the necessary documents, you can get Utah Registered Agent Services.

Step 3: File your Certificate of Organization in Utah

The Certificate of Organization for an LLC is an important document to start your limited liability company (LLC). Utah Certificate of Organization is a simple document that contains the business name and address as well as the name and address of the person who received lawsuits on behalf of the organization.

Here are the guidelines and specific requirements in filing your Certificate of Organization in Utah.

1. Obtain the Necessary Forms: Visit the Utah’s business filing office website, usually the Utah Secretary of State’s office, to download the required forms or file online.

2. Provide the Required Information: Fill in the necessary details in the form, which typically include:

  • The name of your LLC (must include an LLC designator such as “LLC,” “L.L.C.,” or “Limited Liability Company”)
  • The purpose of your LLC (a general statement or specific business activities)
  • The address of your LLC’s principal place of business
  • The name and address of your registered agent (the person or business entity responsible for receiving legal documents on behalf of your LLC)
  • The management structure of your LLC (member-managed or manager-managed)
  • The duration of your LLC, if not perpetual
  • The names and addresses of the LLC’s organizers or members

3. Sign and File the Form: Submit the completed form in the {state} state office, either by mail, in person, or online. You may mail it at Utah Division of Corporations & Commercial Code, P.O. Box 146705, Salt Lake City, UT 84114.

4. Pay the Filing Fee: When you submit your Certificate of Organization, you’ll need to pay a filing fee of $70. Make sure to check and include the correct payment with your submission.

5. Receive Confirmation: After your Certificate of Organization have been filed and processed, you’ll receive a confirmation from Utah, typically a stamped and approved copy of the document or a Certificate of Organization.

Recommended: Filing formation papers is easy and hassle-free if you hire a professional service. We recommend using –

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Once you have successfully filed your Certificate of Organization and it has been approved, your Utah LLC is officially formed. However, remember to complete additional steps, such as creating an Operating Agreement, obtaining an EIN, and registering for any required licenses and permits.

Step 4: Create Your Utah Operating Agreement

An operating agreement is a document that contains all of your company’s organizational details. Drafting an operating agreement in most states is not required. Yet, having one as an internal document is strongly advised. An operating agreement includes information like-

  • About Business
  • Members and management
  • Capital contribution
  • Profit Distribution
  • Change of membership
  • Dissolution

To understand how an operating agreement works, you should check out how to create an operating agreement in Utah.

Recommended: Get oprating agreement drafts ready on your table with a help of a professional service. We recommend using –

LegalZoom($0 + State Fee for LLC formation)

Step 5: Get an EIN

After documenting the operating agreement, you should get or request an Employer Identification Number (EIN) in Utah. An EIN will serve as the tax ID for your professional corporation. EIN can be obtained from the Internal Revenue Service (IRS). It is a 9-digit number similar to Social Security Number. EIN, however, is distinct from SSN. It is only used for business-related activities, particularly for submitting general taxes. The form must be completed and uploaded to the IRS website.

The application of an EIN in Utah can be through the following:

  • Apply Online- The online EIN application is the preferred method for customers to apply for and obtain an EIN.
  • Apply by Fax- Taxpayers can fax the completed Form SS-4 application to the appropriate fax number), after ensuring that the Form SS-4 contains all of the required information.
  • Apply by Mail- The EIN application Form SS-4 can be filed via mail. The processing time frame to receive the mail is four weeks.
  • Apply by Telephone-International Applicants – International applicants may call 267-941-1099 (not a toll-free number) from 6 a.m. to 11 p.m. (Eastern Time) Monday through Friday to obtain their EIN.

In obtaining an EIN for your LLC, you should be aware to ensure that your LLC is eligible for an EIN. You need an EIN if you have employees, operate as a corporation or partnership, or meet other specific IRS criteria. Before applying, gather the required information, including your LLC’s name, mailing address, and the responsible party’s Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN). Also, you can apply for an EIN through various methods, including online, by fax, mail, or telephone (for international applicants).

Recommended: Professional services have the EIN included in their LLC formation package. We recommend using –

LegalZoom($0 + State Fee for LLC formation)

Step 6: Open a Bank Account and Prepare for Taxes

After you have filed for and received your Employer Identification Number, you should open a bank account because you will use this account for yourself, your clients, and your employees.

Your business dealings in Utah might be simpler with a US business bank account because it boosts your company’s legitimacy and liquidity. Most banks demand an EIN to create a business bank account for firms other than sole proprietorships. Also, having an EIN makes tax preparation easier. You can anticipate paying employment and corporate taxes with Utah LLC.

Opening a bank account is necessary for Utah business. If you are still wondering where to open an account in your Utah, you should check the Best Bank for Small Business in Utah.

Step 7: Get a Business and License Permit

You must get a business license in Utah before establishing your LLC. A business license is a legal document granted by a state government body that permits you to conduct business within the area under its jurisdiction. The price of business licenses and permits in Utah ranges from $50 – $300. If there is a requirement for a specific license or city-based permit, you must inquire with the Utah Secretary of State.

Cost to Form an LLC in Utah

Even if you have a business name and structure in mind, you should consider whether you can afford the costs of forming an LLC in Utah. Certificate of Organization costs around $70. The initial filing fee is $70, and the annual fee is $20.

If you forget to pay the annual fee for your Utah LLC, you will have a penalty of $15. However, you can check the Utah LLC Cost for additional information.

Advantages of Creating Utah LLC

Even though some people decide on what to do with their businesses, some choose to put it in their own individual name, while others still choose to set it up via LLC in Utah. Important benefits will help you set up an LLC in Utah.

  • Pass-Through Taxation: The pass-through structure will make the company not pay twice the tax. Most start-ups and entrepreneurs in Utah apply for an LLC because of this structure. Pass-through taxation refers to how income and losses from an LLC (Limited Liability Company) are passed through to its members (owners) for tax purposes rather than being taxed at the business entity level. This means the LLC does not pay federal income taxes; the members’ profits and losses are allocated based on their interests. Each member then reports their share of the LLC’s income or losses on their personal tax returns and pays taxes at their individual tax rates.
  • Ownership Flexibility: If you need sole and primary control over your company’s operations, a sole proprietorship will allow you to do so. If you apply for an LLC in Utah with flexibility, you will have default rules set by law and need an operating agreement.
  • Personal Liability Protection: Personal Liability Protection protects your business from damage, debts, or legal obligations. In personal liability protection, the company’s profits and earnings will stay as is even if your company is about to be sued. This protection of having an LLC in Utah can also be extended to the company’s properties and assets. Many start-up companies will benefit from this since most are starting to build a company. Even if liability exists, the LLC in Utah will protect its assets.

FAQs

What is an LLC?
An LLC stands for “Limited Liability Company”. It’s a corporate structure that protects the owners’ personal assets if the company is sued.
How is an LLC taxed in Utah?
Since LLCs are pass-through entities for tax purposes, the company doesn’t pay taxes. However, owners will need to file an annual tax return and pay both state and federal income taxes on their earnings.
What is the first step to register an LLC in Utah?
The first step is to choose and file your LLC name with the Utah Division of Corporations and Commercial Code.
Can anyone start an LLC in Utah?
Yes, any person or organization can form an LLC in Utah.
Why is Utah an attractive state for an LLC?
Utah has a thriving economy, low unemployment, and a business-friendly climate. Additionally, LLCs in Utah are not subject to franchise taxes.
How much does it cost to start an LLC in Utah?
It costs $70 to file Articles of Organization in Utah.
Are there any requirements for the Articles of Organization in Utah?
Yes, the Articles must include the name and address of the LLC, the name and address of each member, and the name and address of the registered agent.
How long does it take to form an LLC in Utah?
Generally, it takes about two to three business days to form an LLC in Utah if you file online.
Can a single person start an LLC in Utah?
Yes, a single person can form an LLC in Utah. It’s known as a “single-member LLC.”
Do I need a registered agent to start an LLC in Utah?
Yes, every Utah LLC must have a registered agent. They are responsible for receiving legal correspondence from the state on behalf of the LLC.
How do I choose a name for my Utah LLC?
Your proposed LLC name must be distinguishable from any existing business name on record with the state.
Can I change my Utah LLC’s name after filing?
Yes, you can change your Utah LLC’s name, but you’ll need to file Articles of Amendment with the Utah Division of Corporations and Commercial Code.
Can I reserve my proposed Utah LLC name without filing Articles of Organization?
Yes, for a $22 fee, you can reserve your LLC’s name for 120 days.
What is an Operating Agreement in Utah LLCs?
An Operating Agreement is a legal contract between an LLC’s members that guides the management of the business.
Is an Operating Agreement required for Utah LLCs?
An Operating Agreement isn’t required by the state of Utah, but it’s recommended to have.
Can I use a PO Box as my Utah LLC’s registered agent address?
No, the registered agent must have a physical street address within the state where legal documents and service of process can be delivered.
Are there annual report requirements for Utah LLCs?
All Utah LLCs must file an annual report with the Division of Corporations and Commercial Code each year.
Does filing for an LLC in Utah mean that it will be automatically approved?
No, the state can reject your LLC application if you haven’t followed proper filing procedures, or if your name is already taken.
How does Utah affect the operations of my LLC?
Generally speaking, Utah imposes few restrictions on LLCs in regards to daily operations.
Can I operate an online business with a Utah LLC?
Yes, you can operate an online business with a Utah LLC as long as you comply with all local and state laws and regulations.
Should I have a lawyer help me with my Utah LLC?
It’s recommended to consult with a lawyer when forming an LLC, but it isn’t necessary.
Can an LLC in Utah be member-managed or manager-managed?
Yes, an LLC can be either member-managed (managed by all LLC members) or manager-managed (managed by designated managers).
How important is choosing the right management structure for my Utah LLC?
Choosing the right management structure for your LLC is important, as it can impact how the business is managed and can affect liability issues.
How does the state of Utah view LLC liability and payments?
Utah state views LLC liability and payments as separate from the remaining owner’s liabilities.
How do I close my Utah LLC?
To dissolve your Utah LLC, you need to file Articles of Termination with the Division of Corporations and Commercial Code.
Is there a way to quickly close my Utah LLC?
If you’ve never done business with your Utah LLC (and you’ve never made any legal agreements), you may need fewer papers to close your LLC.But if you’ve issued “Member Certificates” or started your business partnership, you’ll need to dissolve your company correctly.
What is a foreign LLC?
A foreign LLC is an LLC that was originally formed in another state but wants to do business within Utah.
What permits might I need before starting a Utah LLC?
Depending on your industry or planned business activities, you may need certain permits or licenses from municipal or state governments to legally operate. Obtaining them ensures your LLC follows proper protocols.
How do I form an LLC in Utah?
To form an LLC in Utah, you need to file the Articles of Organization with the Utah Division of Corporations.
How much does it cost to form an LLC in Utah?
It costs $70 to file your Articles of Organization with the Utah Division of Corporations.
Does Utah require me to have an LLC operating agreement?
Answer:Although an LLC operating agreement is not a legal requirement in Utah, it’s highly recommended to have one in place to establish certain rules and procedures for your business.
Can I file for an LLC online in Utah?
Yes, you can file for an LLC online in Utah by creating an account and filling out the online form.
Is there an annual fee for Utah LLCs?
Yes, Utah LLCs have an annual $15 filing fee.
Is a registered agent required for my Utah LLC?
Yes, all Utah LLCs are required to have a registered agent of an individual or company that agrees to receive legal documents on behalf of the LLC.
Can I be my own registered agent in Utah?
Yes, you can be your own registered agent in Utah, but you still need to provide an address and contact information for legal correspondence.
What is a Utah LLC’s minimum membership requirement?
Utah LLCs require at least one member to be formed.
Can a non-Utah resident form a Utah LLC?
Yes, a non-Utah resident can form an LLC in Utah.
Does Utah have an annual report requirement?
Yes, Utah LLCs must file an annual report each year with the Utah Division of Corporations.
How long is the process to obtain a tax ID number for a Utah LLC?
It usually takes less than an hour to obtain a tax ID number for a Utah LLC.
What is Utah’s sales tax rate?
Utah has a state sales tax rate of 4.85%.
Does Utah impose a franchise tax on LLCs?
No, Utah does not impose a franchise tax on LLCs.
What type of businesses cannot form an LLC in Utah?
Insurance companies and banks cannot form an LLC in Utah.
Is a business license required for my Utah LLC?
Depending on your business type or location, you may be required to have a business license in Utah.
Can I name my Utah LLC anything I want?
Answer:No, you can’t use any name that is already taken or misleadingly similar to another business name in Utah.
How long does a Utah LLC last?
Utah LLCs last until they are dissolved by the state.
What is a single-member LLC?
A single-member LLC is an LLC that has only one owner who holds all the interest in the business.
How is a Utah LLC taxed?
A Utah LLC is considered a pass-through entity for tax purposes and the profits or losses pass through to the individual owners to report on their personal tax return.
Can an LLC provide personal asset protection in Utah?
Yes, with an LLC, personal assets can be protected from business debts and lawsuits in Utah.
Are PLLCs allowed in Utah?
Yes, Utah allows for Professional Limited Liability Companies (PLLCs) for professionals such as doctors and lawyers.
What is the difference between an LLC and a corporation in Utah?
LLCs and corporations differ in the areas of management and taxes, with LLCs offering more flexibility in management and fewer taxes.
How do I dissolve a Utah LLC?
To dissolve a Utah LLC, you need to file Articles of Termination with the Utah Division of Corporations.
Can an LLC be converted to a corporation in Utah?
Yes, an LLC can be converted to a corporation in Utah by filing specific documents with the state.
Are outside investors allowed in Utah LLCs?
Yes, LLCs in Utah can have members who are non-Utah residents and outside investors.
What is the anonymous LLC in Utah?
An anonymous LLC in Utah is an LLC that does not publicly disclose the names of its members.
How often do you need to hold meetings for a Utah LLC?
Utah law does not require LLCs to hold regular meetings; however, it is recommended to memorialize any important transactions.

Also Read

How Fast Can I Form an LLC in Utah

The timeframe for forming an LLC in Utah can vary depending on a few factors. The first step is to choose a name for your business and make sure it is unique and not already in use by another company. Once you have a name, you will need to file Articles of Organization with the Utah Division of Corporations and Commercial Code. This filing officially registers your LLC with the state.

The processing time for the Articles of Organization can vary, but typically it takes anywhere from a few days to a few weeks for the state to approve your application. Once approved, you will receive a Certificate of Organization, which formalizes your LLC’s legal status.

While the timeline for forming an LLC in Utah is reasonable, there are ways to expedite the process if needed. For those who are eager to get their business up and running quickly, the state of Utah offers options for expedited processing of LLC filings for an additional fee.

In addition to the filing process, it is important to consider other steps that may be necessary to start your business. This may include obtaining any necessary business licenses or permits, setting up a business bank account, and creating operating agreements for your LLC.

Despite the time and effort required to form an LLC in Utah, this business structure offers many benefits for entrepreneurs. By establishing an LLC, business owners can protect their personal assets from business liabilities, enjoy pass-through taxation, and create a strong foundation for their company’s growth and success.

In conclusion, while forming an LLC in Utah may require some time and effort, the process is manageable and can be expedited if necessary. Entrepreneurs should be mindful of the steps involved in establishing their LLC and take the time to ensure that all requirements are met. By doing so, business owners can lay the groundwork for a successful and sustainable venture in the state of Utah.

Conclusion

In conclusion, starting an LLC in Utah is a strategic choice for entrepreneurs seeking a flexible, straightforward business structure with limited liability protection. By following the essential steps, including choosing a business name, filing Certificate of Organization, appointing a Registered Agent, creating an Operating Agreement, obtaining an EIN, and securing the necessary licenses and permits, you can successfully establish your LLC. This business structure offers numerous advantages, such as pass-through taxation and ownership flexibility, making it an attractive option for small business owners looking to grow and protect their ventures. As always, consult legal and business professionals for guidance specific to your situation and state requirements.

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