Iowa LLC Costs
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In Iowa, small businesses and entrepreneurs benefit when forming an LLC. The business structure gives business owners access to liability protection, special tax breaks, incentives, and a workable management structure. It is a common belief that forming an LLC in Iowa is expensive and not worth the time. However, the process is straightforward and affordable for most business owners.
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Costs to start an LLC in Iowa
1
LLC Certificate of Organization ($50)
- You must file your Certificate of Organization with the Iowa Secretary of State.
- The cost to file your Iowa Certificate of Organization is $50.
- Iowa does not offer any expected LLC services.
2
Iowa biennial report fee ($30 online)
- You must file a biennial report with the Iowa Secretary of State.
- You will use the Iowa Fast Track Filing website to submit the biennial report.
- The biennial report fee is $30 if you file online and $45 if you file by mail or in person.
- The fee is due every odd-numbered year between January 1st and April 1st.
- The failure to submit a biennial report fee may result in possible involuntary dissolution.
3
Iowa registered agent fee (varies between $50 to $300)
- You must appoint a registered agent when you form an LLC in Iowa.
- When you appoint a registered agent, you are alerting the Iowa Secretary of State that someone is physically available during business hours to accept services such as tax notices and subpoenas.
- In Iowa, you can appoint anyone as a registered agent as long as they meet the state requirements, including yourself.
- The LLC cost for a registered agent in Iowa will depend on the commercial service you appoint, the needs of your LLC, and state filing fees.
4
Fees to form a foreign LLC in Iowa ($100)
- You must register your LLC as foreign if you have an existing in another state and want to expand into Iowa.
- You can register a foreign LLC online using the SOS Fast Track Filing System.
- Or, you can complete the Limited Liability Company Application for Certificate of Authority and submit it by mail.
- The filing fee to register a foreign LLC in Iowa is $100.
5
LLC name reservation fee ($10)
- Iowa does not require you to reserve your LLC before formation.
- But, when you reserve an LLC name, you are ensuring that no one else can register the same before you begin LLC formation.
- An LLC name must be unique in Iowa.
- You can reserve an LLC name for up to 120 days before formation.
- You can use the SOS Fast Track Filing System to register an LLC name online.
- Or, you can complete the Application for Reservation of Name and submit it by mail.
- The LLC filing fee to reserve an Iowa LLC name is $10.
6
DBA filing fees in Iowa ($5)
- The shortened business term DBA stands for ‘doing business as.’. A DBA, or an assumed name, is a registered name that a sole proprietor or company uses to operate under that is not the legal name.
- An LLC must register a DBA if they operate a new business that does not carry the LLC’s legal name.
- You can register your DBA online using the SOS Fast Track Filing System.
- Or, you can complete the Fictitious Name Resolution form and submit it to the Iowa Secretary of State by mail.
- The cost to register an Iowa DBA name is $5.
7
Cost of certified document copies ($5)
- You will order certified LLC documents online using the Iowa Secretary of State website.
- The cost for certified LLC documents in Iowa is $5 plus $1 for every additional page.
8
Iowa Certificate of Existence ($5)
- Banks and money lenders will require you to present a copy of the Iowa Certificate of Existence before allowing you to open a business bank account.
- The filing cost for a Certificate of Existence in Iowa is $5.
Steps to start an LLC in Iowa
1
Choose a business name
When deciding on an LLC name in Iowa, you will want to consider a few things.
- An LLC name in Iowa must be unique and available.
- Your LLC name must meet all Iowa naming requirements.
- You keep branding simple by checking for web domain availability.
You will use the Iowa Secretary of State Business Entities Search to conduct a name search.
LLC name reservation fee
Iowa does not require the reservation of an LLC name before formation.
You can reserve an Iowa LLC name by submitting the form online or by mail. The reservation is good for up to 120 days before formation.
The cost to reserve a company name in Iowa is $10. An LLC name is good for up to 120 days. Iowa does not require you to reserve an LLC name.
2
Appoint an Iowa registered agent
You must appoint a registered agent in Iowa when forming an LLC in the state.
The price for a Iowa registered agent or service varies between $50 and $100 a year. The cost depends on the state and your LLC needs.
A registered agent in Iowa is an individual or business entity that receives tax forms, legal documents, subpoenas, civil notices, service of process, and other official government correspondence on behalf of a sole proprietorship, corporation, or LLC.
The registered agent you choose must be an Iowa resident or a registered agent service authorized to conduct business in the state.
ZenBusiness
- Starter Plan – $39 a year plus State Fees
- Pro Plan – $149 a year plus State Fees
- Premium Plan – $249 a year plus State Fees
ZenBusiness has a stand-alone registered agent service for Iowa LLCs. The price is $99 per year.
Northwest
- Total Out The Door Iowa LLC Formation Service Package – $40 a month and includes:
- Iowa State Fee
- Filing Service Fee
- Registered Agent
- Tax ID
- Annual Plan – $225 plus State Fees a year
LegalZoom
- Economy – $79 plus $153 Iowa filing fees
- Standard – $329 plus $153 state filing fees
- Express Gold – $349 plus $255 state filing fees
3
File Iowa Certificate of Organization
You will file your Iowa Certificate of Organization with the Secretary of State.
You can file your Certificate of Organization online using the Iowa Fast Track Filing System.
Or, you can follow the instructions and submit the filing by mail or fax.
The LLC cost to file an Iowa Certificate of Organization is $50.
Iowa does not offer any expedited LLC services.
Mailing address:
Lucas State Office Building
321 E 12th St
Des Moines, IA 50319
Fax number: (515) 242-5953
The Iowa LLC formation form will ask for specific information.
- LLC name
- Registered agent information
The fee in Iowa for filing your LLC Certificate of Organization is $50.
4
Get an Iowa LLC EIN
An Employer Identification Number, or EIN, can also be referred to as a Federal Employer Identification Number (FEIN) or Federal Tax ID Number (FTIN).
The IRS issues a 9-digit EIN to LLCs for no additional charge. An EIN acts as a Social Security Number for companies for income tax purposes.
In Iowa, you must apply for an EIN if you are converting a sole proprietorship into an LLC.
Applying for an EIN is a simple process online through the IRS website.
Business banking for an Iowa LLC
Financial professionals recommend that you open a business bank account that is separate from your personal bank account. It protects your personal assets and future credit scores.
In Iowa, banks will require you to submit a copy of your Certificate of Organization, operating agreement, and EIN before letting you do business banking.
Business banking accounts are generally free, and do not have additional charges or fees.
Business attorney fees in Iowa
Business attorneys keep LLC formation in Iowa straightforward, and you will have someone on your side to handle future business-related issues.
Iowa business attorneys typically offer free consultations for first-time clients.
Professional services such as LegalZoom and Rocket Lawyer offer LLC formation packages that include comprehensive legal services.
On average, a business lawyer in Iowa will cost $300 per hour.
LLC taxes in Iowa
- An LLC in Iowa is a pass-through entity. An LLC owner files personal tax returns rather than their LLC’s tax returns.
- In Iowa, if you sell physical products, you must register for a seller’s permit using the GovConnectIowa website.
- The Iowa state tax rate is 6.00%, and the max local and county rate is 1.00%.
- You must register for Unemployment Insurance Tax through the Iowa Workforce Development if you hire employees.
- You must also register for Employee Withholding Tax with the Iowa Department of Revenue.
- By hiring a tax expert, you are reducing the chance of missed deadlines, penalties, and possible dissolution.
Business licenses and permits in Iowa
The LLC cost for business licenses and permits in Iowa will vary depending on where the company is located and the type of business.
You will use the Iowa.gov License and Permits website to locate the necessary licenses and permits for your LLC.
A business licence in Iowa varies between $50 to $500. The total cost of permits and licences will depend on where your LLC is, and the type of LLC.
Local government agencies in Iowa will have different processes and rules for licenses. You will want to contact the office to inquire about the process, price, and office hours.
Notary public
Some Iowa LLC formation documents will require a notarization from a notary public.
If you cannot locate one, most government agencies have one in the office.
According to Iowa state law, a notary public can only charge a max of $25 per act.
Employer obligations in Iowa
- If you hire employees in Iowa, you have specific obligations.
- You will verify that all Iowa LLC employees are eligible to work in the United States using Form I-9 from the USCIS Website.
- You must enroll in worker’s compensation insurance.
- You will report all new hires to the state of Iowa using the Iowa Department of Human Services website.
- You can find a complete list of Iowa employer obligations.
Benefits of an Iowa LLC
- In Iowa, business banking is easier when you form an LLC. Banks mandate that you open separate personal and business banking accounts. It will protect your future liability.
- LLCs have different compliance requirements than other business structures. Incorporations must answer to board members and stock owners when they make any major business decision.
- LLCs are pass-through entities in Iowa. Owners file personal tax returns rather than the LLC’s tax returns.
- You can decrease the chances of being double-taxed as an LLC. C-corporations are double-taxed while LLCs are not.
- The cost of forming an LLC in Iowa is highly affordable. Filing your Certificate of Organization costs only $50, and Iowa does not have a franchise tax for LLCs.
- Iowa has state-specific incentives that are available to LLCs. Economic Development Set Aside (EDSA) and Business Tax Incentives are incentives available to LLCs in the state.
FAQs
How long does it take to register an LLC in Iowa?
It will take the Iowa Secretary of State 1 business day to process online LLC registration. If you by mail, it will take 7 to 14 business days.
The state of Iowa does not offer expedited LLC services.
Does Iowa have an annual report fee?
Iowa has a biennial report fee rather than an annual report fee. The biennial fees are due on odd years.
How do I dissolve my Iowa LLC?
You must dissolve your Iowa to avoid ongoing costs. You can file your statement of dissolution online or by mail with the Iowa Secretary of State.
The filing fee for LLC cancellation is $5.
Does Iowa have a publishing requirement?
Unlike Arizona and Nebraska, Iowa does not have any publishing requirements outside of submitting your biennial report fee.
Do I need a business operating agreement for my LLC in Iowa?
In Iowa, LLCs are not required to submit an operating to the Secretary of State. Some financial institutions will need a copy. But, when you have one on file, it helps reduce the chances of future misunderstandings.
An operating agreement can be written or oral as long as it is in the company’s files.
Does Iowa have a franchise tax?
Iowa is one of a handful of states that do not have an annual franchise tax or privilege tax.
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