How to File an LLC: Indiana

Ready to start a small business in Indiana? You’re not the only one. For every Indiana business that closed in 2022, more than eight new businesses opened up.[1]

A new business owner has thousands of decisions to make, including choosing what type of business you want to be. Most Indiana entrepreneurs decide to form a limited liability company (LLC). 

In this article, you’ll learn why this type of business is so advantageous. We’ll also walk you through the filing process step-by-step and show you how our filing service can make things easier.

Key Takeaways

• An LLC combines the liability protections of a corporation with the flexible management and tax benefits of a sole proprietorship.

• To make your Indiana LLC official, you must file your articles of organization and indicate if your LLC is member- or manager-managed. 

• The LLC formation includes choosing a distinguishable business name, hiring a registered agent, and filing for an Employer Identification Number (EIN)

What Is LLC Formation?

Your business structure dictates how the state and federal government governs and taxes your small business. A limited liability company (LLC) is a hybrid structure that provides business owners the liability protection of a corporation while maintaining a status similar to a sole proprietorship or partnership for tax purposes. 

Let’s compare the LLC business structure with your other options to understand why it is so powerful.

Sole Proprietorship

Your small business is a sole proprietorship if you’re operating without official incorporation. Financially or legally, there’s no difference between you and the business you’re running.

Advantages

“Pass-through” tax: For tax purposes, your personal income taxes and your business taxes are the same, so you don’t pay any corporate taxes.

Low maintenance: There’s no annual filing fee, incorporation paperwork, bylaws, board members, or renewals, though you will have to pay state fees to register to pay sales tax and other relevant taxes.

Flexibility: You can run your business however you want, without questions.

Drawbacks

Liability: If your business gets in legal or financial trouble, you are responsible for the debt and fees. This means a lawsuit could bankrupt you, and personal assets like your house and life savings are vulnerable.

Partnership

A partnership is the equivalent of a sole proprietorship through the collaboration of one or more people.

Advantages

“Pass-through” tax: Like sole proprietorships, partners claim profits or losses on personal income taxes and avoid corporate tax.

Low maintenance: Partnerships don’t have to incorporate and have less paperwork and state fees than most corporations.

Flexibility: As long as you and your partner agree, you can do things your way.

Drawbacks

Liability: Because your partnership has no liability protection, your personal property and assets are vulnerable if you face a lawsuit or debt crisis.

C Corp

A C corp is the standard business structure for a corporation. They can issue stock, go public, and raise money in several ways. Its owners and shareholders have limited liability for the company’s actions.

Advantages

Liability protection: The C corporation’s assets and liabilities are separate from those of its shareholders. Suppose the business gets sued or goes bankrupt. In that case, the damage is confined to the corporation, and the shareholders and owners have personal liability protection.

Financing power: If you’re looking to issue or sell stock, a C corp can do that. 

Shareholder flexibility: Who owns a C corp at a given time isn’t legally crucial for the company, so that can change hands smoothly.

Drawbacks

Double taxation: C corps pay taxes at the corporate level via corporate income taxes. Then, when profits are distributed to shareholders, those dividends are subject to income tax. 

Regulations: C corps require high annual filing fees, lengthy annual reports, regular board meetings, and adherence to rules and governance regulations.

S Corp

An LLC or C corp can appeal to the IRS for S corp tax status. S corps enjoy “pass-through” taxation and avoid self-employment tax by allocating a “reasonable salary” for all employees.

Advantages

For C corps: S corp status allows C corps to enjoy “pass-through” tax status, as long as they only issue one type of stock and qualify under other limitations.

For LLCs: LLCs can still enjoy “pass-through” tax advantages and can reduce their tax liability if they’re making a substantial profit.

Drawbacks

For C corps: S corp status comes with some limitations, including who can be shareholders in the corporation and the types of stock it can issue.

For LLCs: S corp status comes with extra filing fees and paperwork that might outweigh the advantage for tax purposes.

LLC

The LLC business structure allows members to enjoy pass-through taxation and liability protection for their business activities.

Advantages

Tax savings: LLC members pay taxes on the LLC’s profit and loss through their personal income tax; no corporate tax is due to the IRS. Avoiding a C corp's “double taxation” is a massive advantage.

Liability protection: Like shareholders in a corporation, LLC members are insulated from the debts and liabilities of their limited liability company. 

Flexibility: LLCs are easy to operate and require little paperwork, with no governance regulations, as long as they remain in good standing.

Drawbacks

Member-dependent: If members join or leave an LLC, articles of amendment must be filed with the Indiana Secretary of State along with a $30 filing fee.[2, 3] These changes can be disruptive to some types of businesses.

Financing restrictions: LLCs can’t raise money by selling stock as a corporation can.

State taxes like sales tax remain the same regardless of your business structure. For tax purposes, your business structure only affects income tax.

The LLC formation process suits most new businesses in Indiana. If you’re ready to start an LLC, read on to familiarize yourself with the filing process with the Indiana Secretary of State. 

Step-By-Step Guide to Starting Your Indiana LLC

The LLC filing fee with the Indiana Secretary of State is $90, but it’s not as simple as just paying the money. You’ll need to find a unique business name, fill out your articles of organization, prepare your LLC operating agreement, designate a registered agent, and get squared away with the IRS.

Bringing a new business into the world is exciting. But you’ll want to read carefully to ensure your LLC is set up for long-term success with vital legal documents to protect you and your partners. . 

Step 1: Choose a Business Name for Your Indiana LLC

When you start an LLC, your business name can not be the same as another Indiana business. Indiana entrepreneurs can check business name availability with our free business name search tool or create an Access Indiana account to search on the INBiz website. The state of Indiana also has a name availability line: (317) 232-6576.[4]

Your Indiana LLC business name must end with either the words “Limited Liability Company” or the letters “LLC.” Additionally, your name must be distinguishable from existing Utah business names. [4]

If you’re not sure if your LLC name is distinguishable from one that’s similar to yours, keep these guidelines in mind.[5]

An existing Indiana business name is NOT distinguishable from your business name if it is the same, but:

• Has a different “business identifier” (i.e., “corporation” instead of “LLC”)

• Varies in punctuation or capitalization (Fun Times! vs. fun times)

• Varies in spell-out or roman numbers (eight vs. 8 vs. VII)

• Uses & instead of “and” and vice versa

• Adds or removes articles (The Fun Zone vs. Fun Zone)

• Changes plurals or possessives (Brother Carpentry vs. Brothers Carpentry)

• Hyphenates or combines words (FunZone vs. Fun-Zone)

An existing Indiana business name IS distinguishable from your LLC name if the words, letters, or numbers are different or the elements of the name are in a different order.

For example, these are all considered different names in Indiana:

• Delicious Cookies LLC

• Cookie Festival LLC

• Festival Cookies LLC

Additional Considerations When Choosing Your LLC Name

Finding a business name for your LLC that you can register with the state is critical. But that’s not the only factor you should consider when choosing a name for your LLC. Here are more things to think about.

DBA

If you can’t find the perfect name, you can always get a DBA, which stands for “doing business as.” This registered assumed name allows you to conduct business under a name different from your LLC. You only need to fill out a simple form called a certificate of assumed business name, which costs $21 to file with the state.

Name Reservation

When you’re ready to name your Indiana LLC, you can reserve your name for 120 days on the INBiz website with a $20 filing fee.[4] Note that just because the name is available on the website does not guarantee that it will be approved or that you can start using it. 

Web Domains and Social Media

You want your LLC name to be unique for marketing purposes, too. Try a domain search and consider reserving a web domain with your business name. It’s also wise to see if relevant social media handles are available for your business to reach customers and partners through those channels.

Trademarks 

In addition to your business name, there might be elements of your business that you want to trademark and protect from copiers. For instance, it’s thanks to trademarks that only McDonald’s can sell sandwiches called Big Macs in the United States.

You can search the Indiana state database and register your trademark with the Indiana Secretary of State. However, this won’t ensure that business owners nationwide can’t use it.[6] Resources like Trademark Engine can help you register a national trademark with the United States Patent and Trademark Office (USPTO).

Step 2: Fill Out Your Indiana Articles of Organization

Your Articles of Organization is the document you file to make your Indiana LLC official. Here’s what information you need:[4] 

• LLC business name

• Duration of the LLC

• Indiana registered agent’s name and street address

• Statement if manager-managed (No statement required if member-managed)

• Signature from one organizer, member, or manager

Most LLCs are filed online with a $90 filing fee. We’ll take care of all the paperwork to file your LLC so you can focus on growing your business. After you file, the Indiana Secretary of State will get back to you in ten business days if your registration is rejected, with a brief explanation of why.[7]

To keep your business in good standing, you must file a biennial report every two years by the end of the anniversary month of the day you initially filed. The information required is roughly the same as the articles of organization.[8] The filing fee is only $30, and there’s a discount for filing online.

Step 3: Hire an Indiana Registered Agent

Your Indiana registered agent is where government offices will send official legal documents and service of process related to your business. Suppose your company ever gets in legal trouble or is summoned to court. In that case, your registered agent is the entity that receives your mail on your behalf and notifies you of what’s going on.

To incorporate your LLC, you must name a registered agent with a street address in Indiana. Your business cannot be its own registered agent.[4]

How Should I Pick My Registered Agent?

Your Indiana registered agent is a little like your LLC’s emergency contact. You must be able to trust them in a crisis since these legal documents are often time-sensitive. They must also keep regular business hours at the listed street address.  

Plenty of registered agent services are experienced and reliable at handling documents for Indiana businesses. Our affordable registered agent service has helped thousands of companies like yours stay on track and in good standing over the years. We’ll keep your documents secure and accessible.

Step 4: Create an LLC Operating Agreement

An LLC operating agreement outlines essential procedures and contingencies for your business entity. Some questions an operating agreement might answer would be:  

• Will the LLC be member-managed or manager-managed? 

• Under what conditions will the organization dissolve? 

• If you have a single-member LLC, how might members be added?

Indiana law does not require your LLC to sign an operating agreement, but it is a smart idea. The LLC business structure provides a high degree of flexibility. However, that legal void can create catastrophe if LLC owners don’t define their business operations via a written operating agreement.

All business owners—even single-member LLCs and foreign LLCs—should sign an LLC operating agreement that establishes simple legal guardrails that help protect your personal assets. We can help you install a functional and personalized LLC operating agreement quickly and easily.

Step 5: File for an Employer Identification Number

When you fill out your Federal tax forms, you use your social security number to identify yourself to the Internal Revenue Service (IRS). An Employer Identification Number (EIN) is the equivalent for your Indiana business.

Without an EIN, your small business can’t do much. You’ll need an EIN to complete critical operations, including: 

• Register with the Indiana Department of Revenue to collect sales tax 

• Open a business bank account

• Hire employees

• Apply for a credit card

• Obtain business licenses needed to operate legally

We can get your EIN for you so you’re set up to file your tax returns during your first year of business.

Let Us Handle Your LLC Paperwork

You want to get every step exactly right when forming an Indiana LLC. But luckily, you don’t have to do it alone. We’ve helped thousands of entrepreneurs like you through the LLC formation process. 

With us on your side, your Indiana LLC will be sure to have everything in place for long-term success, so you can focus on building your small business instead of doing paperwork. We’ll also store everything securely online, so you don’t have to worry about misplacing critical documents.

With Swyft Filings, your LLC formation won’t just be simple and painless. We also provide wrap-around consultation and expert business advice, a top-notch registered agent service, and file other documents for you like a DBA, annual report, and other things your small business may need. Get started with us and gain a trusted partner for the life of your business.

FAQs

How much does it cost to set up an LLC in Indiana?

The filing fee for Indiana LLC articles of organization is $90.

How is an LLC taxed in Indiana?

LLCs are “pass-through” entities, meaning members pay income tax for the company’s profit or losses on their personal income taxes.

What are the benefits of an Indiana LLC?

The LLC business structure affords you the liability protections of a corporation combined with the flexibility of management and tax benefits of a sole proprietorship or partnership.

How do you dissolve an LLC in Indiana?

File your articles of dissolution with the Indiana Secretary of State and follow the closing procedures from the IRS and the Indiana Department of Revenue.

Bibliography

1. INBiz. “Business Statistics Page.” Accessed January 21, 2023.

2. State of Indiana. “Frequently Asked Questions.” Accessed January 21, 2023.

3. Indiana Secretary of State. “Articles of Amendment of the Articles of Organization.” Accessed January 21, 2023

4. Secretary of State: Connie Lawson. “An Entrepreneur’s Guide to Starting a Business in Indiana.” Accessed January 23, 2023. 

5. INBiz. “File With the Secretary of State.” Accessed January 23, 2023.

6. INBiz. “Trademark Resources.” Accessed January 23, 2023.

7. Indiana General Assembly. “2020 Code Title 23.” Accessed January 23, 2023.

8. INBiz. “Business Entity Reports.” Accessed January 23, 2023.