This guide will help you set up an LLC in Pennsylvania. It includes step-by-step instructions for obtaining tax IDs and filing documents.
Overview
LLCs are the most preferred business structure because they are affordable to set up, offer flexibility for the owners, and are simple to manage. Your LLC legalizes your business and limits your personal liability. It also allows you to have tax flexibility. As you go through this process, the following steps will guide you.
Fast facts: How to manage your budget and time.
This overview will show you how much paperwork, costs, and time it takes to form an LLC in Pennsylvania. To understand the ongoing costs of maintaining a Pennsylvania LLC compliant, make sure you read the last step in this guide, “Ongoing Filings.”
Paperwork
- Form DSCB:15-8913-2 Certificate of Organization – Domestic Limited Liability Company
- Operating Agreement
- IRS Form SS-4: Obtain your EIN
- PA-100: PA Enterprise Registration Form
Cost
- Formation: $125
- EIN: $0
- PA-100: $0.0 + fees for required licenses
Time
- Formation: ~5-10 business days.
- EIN: Online immediately
- PA-100: Prices vary based on tax accounts/licenses
Step-by-Step Pennsylvania LLC Instructions
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Check Name Availability
Your LLC’s legal name may not conflict with any registered name. You can search for the name you want to check availability.
Name Search: Pennsylvania Department of State – Bureau of Corporations and Charitable Organizations
Name searchName Reservation: Optional Suffix: Must contain the terms “company,” limited,” or “limited liability” or an abbreviation thereof, as well as words or abbreviations that are similar to import.
Pennsylvania Code Title 2 §204 -
Name a registered agent.
Before you officially file to create your Pennsylvania LLC, you will need to decide who your Pennsylvania registered agent will be. Registered agents are a business’s legal representatives who receive notices about lawsuits and other legal or government notices.
Every LLC must have a registered agent as required by state law. When you file Pennsylvania articles of incorporation with the Pennsylvania Department of State Bureau of Corporations and Charitable Organizations, the registered agent will be designated.
Our reliable registered agent service meets this requirement. You get:
- Our local Lancaster office can provide same-day documents
- Instant online access to state forms, with our address and, where necessary, our signature
- Annual fees starting at $89-$99 per state, with no additional charges
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Pennsylvania Certificate of Formation
To create a limited liability company, file the articles of organization
Agency: Pennsylvania Department of State – Bureau of Corporations and Charitable Organizations Formula: Certificate of Organization Filing Method Mail or online. Agency Fee: $125 Turnaround ~5-10 business days. Law 15 Pa. Code Ch. 89 Notes - You need to file a PA docketing statement with your certificate.
- Veterans are exempted from paying the $125 certificate fee. Filers requesting a veteran/reservist-owned small business fee exemption should attach proof of the veteran’s or reservist’s status to the Certificate of Organization form when submitted.
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Establish Company Records
Your LLC must maintain accurate and complete records. Your LLC’s first records will be your filed articles of organization. Other official records that your LLC may produce include:
- Minutes of meetings
- Operating agreement
- EIN verification letter
- Amendments to and other filings made by the LLC during its lifetime
Secure, centrally managed tools are essential for organizations to access and manage sensitive records. Registered agents often provide software to store records, track members and managers, and customize meeting notifications.
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Make the Operating Agreement
Draft an Operating Agreement (potentially using a template) which is the governing document for the LLC. This document outlines the procedures for how the LLC will operate, such as holding an annual meeting. The agreement will be reviewed and approved at your organization’s meeting.
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Organize the Organizational Meeting
The first meeting of the members of the LLC is the organizational meeting. To conduct this meeting, you will need to have your filed articles of organization and your operating agreement. You should keep a record of the meeting and keep it in your company records book.
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Register for a Federal Employer Identification Number.
If your LLC has more than one member or will hire employees, it must obtain an EIN. A bank account opening requires an EIN.
Agency: Internal Revenue Service (IRS). Formula: IRS Form SS-4 Filing Method Mail, phone, fax, or online. IRS fee $0 Turnaround Online or over the phone, immediately. 4 business days via fax. 4-5 weeks via mail Notes Only certain hours are available on the IRS website. Before closing your session, print your EIN. For additional guidance, see IRS Pub 1635: Understanding Your EIN. Reference: Pennsylvania Dept of State website
Visit the Pennsylvania Department of State for current files and procedures.
https://www.dos.pa.gov/Pages/default.aspx
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Find Pennsylvania State Tax Identification Numbers/Accounts
Multiple tax IDs are issued in Pennsylvania – one for each box number and tax account number. If your business sells candy bars and has employees, you will have separate tax accounts numbers for employer withholding tax and sales tax.
Send your submission to: Pennsylvania Department of Revenue
www.revenue.state.pa.us/Formula: PA-100: PA Enterprise Registration Form Guidance REV-588: Starting a Business in Pennsylvania – A Beginner’s Guide Fee Licenses required: $0 + fees Filing Method Mail or using Online Business Registration Interview (OBRI) -
Consider Electing C-Corp Taxation or S-Corp Fiscal
Your LLC will automatically be subject to pass-through taxation. However, the majority of LLCs maintain this tax classification. Some LLCs can choose to elect S-Corp and C-Corp tax treatment.
- S-Corp treatment can help owner-employees who earn more than ~$75,000 per year save on self-employment taxes. File Form 2553: S-Corp Election.
- Double taxation is a problem for C-Corps: members pay taxes on distributions, and the corporation pays taxes. C-Corps may offer low tax rates for retained earnings if profits exceed $250,000 per owner. File Form 8832: C-Corp Election.
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Get Business Licenses and Permits
You must have the appropriate licenses and permits to run your business legally. The easiest way to navigate the wide range of federal, state, and local requirements is to search by your business type and locality using the Small Business Administration Business License & Permit lookup tool.
Pennsylvania Business License
NOT REQUIRED
Pennsylvania does not require licensure for general business licenses.
Pennsylvania does not have an overall business license at the state level, but licenses from local authorities are required.
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You must continue to file for your LLC.
You are required to file both federal and state tax returns.
To maintain good standing with the secretary-of-state, many states require that business entities file an annual report. The table below shows the requirements for annual reports for Pennsylvania LLCs.
Pennsylvania Corporation Annual Report Requirements
Agency: Pennsylvania Department of State – Bureau of Corporations and Charitable Organizations Formula: Decennial Report of Association Continued Existence Filing Method Mail Agency Fee: $70 You are responsible: Each ten-year decennial report must be filed during the years that end with “1”, 2021, 2031, etc. Decennial year reports must be submitted by December 31. Law 54 PA Cons Stat SS 503 Notes - Only entities registered in Pennsylvania before the previous year are exempt from the decennial filing requirement. They must also have not filed an amended filing with the Bureau of Corporations and Charitable Organizations after the end of that year.
- The decennial reporting obligation is generally not applicable to nonqualified foreign entities with a Pennsylvania name registration and corporations who have updated their list with the Department in the past 10 years.
Fact checked: 1/11/21
