This guide for starting an LLC in Arkansas offers step-by-step instructions on how to file formation documents, obtain tax IDs, and set up company records.
The most widely used business structure is the LLC. They are cheap to create, allow for flexibility, and are easy to run. Legally forming an LLC establishes your company, reduces personal liability, and allows for tax flexibility. This guide will walk you through the process step by step.
Step-by-Step Arkansas LLC Instructions
Verify Name Availability
The legal name of your LLC cannot be confused with any other registered name. Do a name search to find the availability of your preferred name.
Name Search Arkansas Secretary Of State – Business and Commercial Services Division. (BCS). Name Reservation Optional Suffix: As per the company’s articles of organization, the name of each limited liability company must include the words “Limited Liability Company”, “Limited Company”, or the abbreviations L.L.C.,” L.C.,” L.C.,” L.C.” and “LC.” The abbreviations for “Limited”, “Ltd,” “LLC,” and “Company” are acceptable.
Designate a Registered Agent
Before you file to establish your Arkansas LLC, it is necessary to determine who your Arkansas Registered Agent will be. Registered agents allow a business to be notified of legal notices, such as government or lawsuit notices, and act as their legal representative.
Each LLC must be registered by an agent under state law. Arkansas Secretary Of State – Business and Commercial Services Division (BCS) will designate the registered agent when you file Arkansas articles.
Arkansas Certificate of Formation
For limited liability companies, you will need to file the articles.
Agency: Arkansas Secretary Of State – Business and Commercial Services Division. (BCS). Form:
LL-01: Articles on Organization for a Dom. Limited Liability Co.
Filing Method online or mail. Agency Fee $50 paper. $45 online. Turnaround: ~2-3 business days Law:
Arkansas Code, Title 4: Business and Commercial Law
Establish Company Records
Your LLC must keep accurate and complete books. Your LLC’s initial documents are your filed articles. The LLC will also produce many other official records, such as:
- Minutes from meetings
- Operating Agreement
- EIN verification letter
- All amendments and filings made to LLC during its lifetime
The Operating Agreement should be created
You can draft an Operating Contract, which will be the governing document for your LLC. It outlines the rules and procedures of how the LLC should operate. You will review the agreement at your organizational meeting and vote on it.
The Organizational Meeting will be held
The organizational meeting is the first meeting for members of the LLC. This meeting will require your operating agreement and your filed articles of organization. Keep the minutes of this meeting in your company record book.
Receive a Federal Employer Identification Number, (EIN).
An EIN must be obtained if your LLC has more members or plans to hire employees. An EIN is often needed to open a bank account.
Agency: Internal Revenue Service Form:
IRS Form HTML4
Filing Method Mail, phone, or Online. IRS fee $0 Turnaround: You can order online immediately or by telephone. 4 business days by fax. 4-5 weeks by post Notes: The IRS website is not available after hours. Before you close your session, print your EIN. For additional guidance, refer to IRS Public 1635: Understanding your EIN.
Arkansas State Tax Identification numbers/Accounts
Arkansas offers a consolidated tax registration application.
- Send to:
- Arkansas Department of Finance and Administration
AR-1R: Combined Business Tax Register Form
Instructions for form AR-1R
Arkansas – A Guide for Starting a New Business – An Educational Brochure to assist Arkansas Taxpayers
- Filing Method
- Mail or in-person
- $0. $50 for Gross Receipt (Sales tax) Permit
- Two weeks prior to the commencement of tax-exempt activity, you must apply. Please submit no more than 60 calendar days before the date of opening.
Consider Electing C-Corp Taxation / S-Corp Governance
Your LLC is subject to pass-through taxes by default. Most LLCs retain this tax classification. Some LLCs may be eligible for C-Corp or S-Corp tax treatment.
- S-Corp can be used to help owners who earn more that $75,000 annually save on self-employment tax.
- C-Corps are subject to double taxation. The corporation pays taxes on profits, and members pay taxes for distributions. C-Corps may offer low tax rates for retained earnings if profits exceed $250,000 per owner.
Apply for Business Licenses & Permits
Licenses and permits are required to legally run your business. You can search for your type of business and the location you live in using the Small Business Administration Business License & Permit Look-up Tool. This will allow you to quickly navigate through the many federal, state, local, and international requirements.
Arkansas Business License
Arkansas does not require general business licensure.
Arkansas does not have a state-level general business license, but licenses at the local level are often required.
For your LLC, you will need to continue filings
You must file tax returns for both the federal and state levels.
In many states, business entities must file an annual reporting to keep good standing with their secretary of state. For LLCs created in Arkansas, see the table below to determine if an annual report is required.
Arkansas Corporation Annual Report Requirements:
Agency: Arkansas Secretary Of State – Business and Commercial Services Division. (BCS). Filing Method Agency Fee Stock with outstanding:.3% of capital stock; minimum $150 Without stock: $300 +$5 for filing online. Due: Annually, May 1. Law:
A.C.A. SS 26–54–104
Penalties: $25 per day plus interest Penalty will not exceed twice what was owed on the original tax. Notes:
- The filing is required for any member, manager, or corporate officer.