Forming an Iowa LLC is easy, just follow these simple steps:
To form an LLC in Iowa you will need to file a Certificate of Organization with the Iowa Secretary of State, which costs $50. You can only apply online. The Certificate of Organization is the legal document that officially creates your Iowa Limited Liability Company.
Follow the step-by-step guide below to start your Iowa LLC today and get your business up and running.
STEP 1: Name your Iowa LLC
Choosing a company name is the first and most important step in starting your LLC. Be sure to choose a name that complies with Iowa naming requirements and is easily searchable by potential clients.
1. Follow the naming guidelines:
- Your name must include the phrase “limited liability company” or one of its abbreviations (LLC or L.L.C.).
- Your name cannot include words that could confuse your LLC with a government agency (FBI, Treasury, State Department, etc.).
- Restricted words (e.g. Bank, Attorney, University) may require additional paperwork and a licensed individual, such as a doctor or lawyer, to be part of your LLC.
2. Is the name available in Iowa? Make sure the name you want isn't already taken by doing a name search on the State of Iowa website.
3. Is the URL available? We recommend that you check to see if your business name is available as a web domain. Even if you don't plan to make a business website today, you may want to buy the URL in order to prevent others from acquiring it.
After registering a domain name, consider setting up a professional email account (@yourcompany.com). Google's G Suite offers a business email service that comes with other useful tools, including word processing, spreadsheets, and more. Try it for free
FAQ: Naming an LLC
Do I need to get a DBA or Trade Name for my business?
Most LLCs do not need a DBA. The name of the LLC can serve as your company’s brand name and you can accept checks and other payments under that name as well. However, you may wish to register a DBA if you would like to conduct business under another name.
To learn more about DBAs in your state, read our How to File a DBA in Iowa guide.
STEP 2: Choose a Registered Agent in Iowa
You are required to nominate an Iowa Registered Agent for your Iowa LLC.
What is a Registered Agent? A registered agent is an individual or business entity responsible for receiving important legal documents on behalf of your business. Think of your registered agent as your business' point of contact with the state.
Who can be a Registered Agent? a Registered Agent must be a resident of Iowa or a corporation, such as a registered agent service, authorized to transact business in Iowa. You may elect an individual within the company including yourself.
TIPRecommended: ZenBusiness provides the first year of registered agent service free with LLC formation ($39 + State Fees)
FAQ: Nominating a Registered Agent
Can I be my own registered agent?
Yes. You or anyone else in your company can serve as the registered agent for your LLC.
Read more about being your own registered agent.
Is a Registered Agent service worth it?
Using a professional Registered Agent service is an affordable way to manage government filings for your LLC. For most businesses, the advantages of using a professional service significantly outweigh the annual costs.
For more information, read our article on Iowa registered agents.
STEP 3: File Your Iowa LLC Certificate of Organization
To register your LLC, you will need to file the Certificate of Organization with the State of Iowa. This can be done online.
Now is a good time to consider whether your Iowa LLC will be member-managed or manager-managed. We recommend learning more about member-managed vs manager-managed LLCs before you file.
File the Certificate of Organization
File the Certificate of Organization Online with the Iowa Secretary of State
Fee: $50 (Nonrefundable)
Note: After logging in click "File a Document" located in the top menu.
If you’re expanding your existing LLC to the State of Iowa, you will need to form a Foreign LLC.
FAQ: Filing LLC Documents
What is the processing time to form my Iowa LLC?
Immediately after payment is received.
What is the difference between a domestic Iowa LLC and foreign LLC?
An LLC is referred to as a "domestic LLC" when it conducts business in the state where it was formed. Normally when we refer to an LLC we are actually referring to a domestic LLC. A foreign LLC must be formed when an existing LLC wishes to expand its business to another state.
Read our What Is a Foreign LLC article to learn more.
STEP 4: Create Your Iowa LLC Operating Agreement
An operating agreement is not required in Iowa, but it's a good practice to have one.
What is an operating agreement? An operating agreement is a legal document outlining the ownership and operating procedures of an LLC.
Why are operating agreements important? A comprehensive operating agreement ensures that all business owners are on the same page and reduces the risk of future conflict.
For more information on operating agreements, read our Iowa LLC operating agreement guide.
Recommended: Download a template or create a Free Operating Agreement using our tool.
FAQ: Creating an Operating Agreement
Do I need to file my operating agreement with the state?
No. The operating agreement is an internal document that you should keep on file for future reference. However, many states do legally require LLCs to have an operating agreement in place.
STEP 5: Get an EIN for your Iowa LLC
What is an EIN? The Employer Identification Number (EIN), or Federal Tax Identification Number, is used to identify a business entity. It is essentially a social security number for the company.
Why do I need an EIN? An EIN is required for the following:
- To open a business bank account for the company
- For Federal and State tax purposes
- To hire employees for the company
Where do I get an EIN? An EIN is obtained from the IRS (free of charge) by the business owner after forming the company. This can be done online or by mail.
FOR INTERNATIONAL APPLICANTS: you do not need an SSN to obtain an EIN. For more information, read our guide on how to obtain an EIN as a foreign LLC.
FAQ: Getting an EIN
What tax structure should I choose for my LLC?
When you get an EIN, you will be informed of the different tax classification options that are available. Most LLCs elect the default tax status.
However, some Iowa LLCs can reduce their federal tax obligation by choosing S corporation status. We recommend consulting with a local accountant to find out which option is best for you.
Considering Using an LLC Formation Service?
We reviewed and ranked the top 5 LLC formation services.
Find out which is best for starting your Iowa LLC.
Protect Your Business & Personal Assets
Business Banking for Personal Asset Protection
Using dedicated business banking and credit accounts is essential for personal asset protection.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your LLC is sued. In business law, this is referred to as piercing your corporate veil.
You can protect your business with these two steps:
1. Opening a business bank account:
- Separates your personal assets from your company's assets, which is necessary for personal asset protection.
- Makes accounting and tax filing easier.
Recommended: You can get $200 when you open a Chase business checking account with qualifying activities. Learn more.
2. Getting a business credit card:
- Helps you separate personal and business expenses.
- Builds your company's credit history, which can be useful to raise capital later on.
Recommended: Learn more about the best small business credit cards.
Business insurance helps you manage risks and focus on growing your business. The most common types of business insurance are:
- General Liability Insurance: A broad insurance policy that protects your business from lawsuits. Most small businesses get general liability insurance.
- Professional Liability Insurance: A business insurance for professional service providers (consultants, accountants, etc.) that covers against claims of malpractice and other business errors.
- Workers' Compensation Insurance: A type of insurance that provides coverage for employees’ job-related illnesses, injuries, or deaths.In Iowa, businesses with one or more employees, excluding business owners, are required by law to have workers' compensation insurance. Get a free quote with ADP.
Learn more about which business insurance you need to keep your business safe.
Properly Sign Legal Documents
Improperly signing a document as yourself and not as a representative of the business can leave you open to personal liability. When signing legal documents on behalf of your company, you could follow this formula to avoid problems:
- Formal name of your business
- Your signature
- Your name
- Your position in the business as its authorized representative
See the image below for an example.
This ensures that you are signing on behalf of your LLC and not as yourself.
Learn more on how to protect your business & personal assets by reading our article - How to Maintain your LLC Corporate Veil.
Keep Your Company Compliant
Iowa LLC Business Permits and Licenses
To operate your LLC you must comply with federal, state, and local government regulations. For example, restaurants likely need health permits, building permits, signage permits, etc.
The details of business licenses and permits vary from state to state. Make sure you read carefully. Don't be surprised if there are short classes required as well.
Fees for business licenses and permits will vary depending on what sort of license you are seeking to obtain.
Find out how to obtain necessary licenses and permits for your business or have a professional service do it for you:
- Federal: Use the U.S. Small Business Administration (SBA) guide.
- State: Apply for or learn more about licenses, permits and registration with Iowa's Business License Information Center.
- Local: Contact your local county clerk and ask about local licenses and permits.
Recommended: If you are a first-time entrepreneur, consider having a professional service research your business’ licensing requirements. Our friends at Startup Savant have reviewed and ranked the top five license research services.
Iowa LLC Tax Requirements
Depending on the nature of your business, you may be required to register for one or more forms of state tax.
If you are selling a physical product, you’ll typically need to register for a sellers permit through the Iowa Department of Revenue website.
This certificate allows a business to collect sales tax on taxable sales.
Sales tax, also called "Sales and Use Tax," is a tax levied by states, counties, and municipalities on business transactions involving the exchange of certain taxable goods or services.
Read our sales tax guide to find out more.
If you have employees in Iowa, you will have to register for Unemployment Insurance Tax through the Iowa Workforce Development website. You will also need to sign up for the Employee Withholding Tax through the Iowa Department of Revenue on behalf of your employees.
Federal LLC Tax Requirements
Most LLCs will need to report their income to the IRS each year using:
- Form 1065 Partnership Return (most multi-member LLCs use this form)
- Form 1040 Schedule C (most single-member LLCs use this form)
Read our LLC Tax Guide to learn more about federal income taxes for LLCs.
Iowa LLC Biennial Report
Iowa requires LLCs to file a biennial report with the Iowa Secretary of State. This can be done online.
File your Biennial Report
File Online with the Iowa Secretary of State
Fee: $60 (Nonrefundable)
Due Date: Due between January 1st and April 1st of every odd numbered years.
Late Filings: Iowa does not charge late fees if you miss your filing deadline but may administratively dissolve your LLC after a few months for failure to file an annual report.
Avoid Automatic Dissolution
LLCs may face fines and even automatic dissolution when they miss one or more state filings. When this happens, LLC owners risk the loss of limited liability protection. A quality registered agent service can help prevent this outcome by notifying you of upcoming filing deadlines and by submitting reports on your behalf.
Recommended: ZenBusiness offers a reliable registered agent service and excellent customer support.
Get Help Starting a Business in Iowa
We understand that creating an LLC and getting your business up and running comes with many challenges. To help you succeed, we compiled the best local resources in every major metro area in Iowa. You can get free assistance in the following areas:
Make Running Your Business Easier
After starting a business, two of the most important things you can do are get professional accounting and hire the right employees. Streamlining these processes can save you time and money as your business grows.
If you plan to hire employees, stay compliant with the law by following these steps:
- Verify that new employees are able to work in the US
- Report employees as "new hires" to the State
- Provide workers' compensation insurance for employees
- Withhold employee taxes
- Print compliance posters and place them in visible areas of your work space
Find more information on the Iowa WorkForce Development website.
Recommended: Check out our Hiring for your Small Business Guide for resources like sample job descriptions, payroll service reviews, and more.
FAQ: Hiring Employees
What is the minimum wage in Iowa?
The minimum wage in Iowa is $7.25 per hour.
How often do I need to pay employees?
Iowa allows wages to be paid in any frequency, as long as it is on a reliable schedule and happens once per month.
Accounting For Your Iowa LLC
It’s critical to get your books in order-- even if you haven’t officially opened for business. A well-managed accounting system will help you:
- Track your business finances, including bills, expenses, and income.
- Simplify your annual tax filings.
The right software makes accounting easy. Look for software that:
- Syncs with your bank automatically.
- Matches transactions to invoices, bills and purchase orders.
- Can be accessed from your phone.
Recommended: QuickBooks has all the accounting features your small business will need.
Try QuickBooks for free
Women in Business Tools and Resources
If you have a woman-owned business, many resources are available to help you concentrate on your business’s growth:
- Funding - (ie. grants, investors, loans)
- Events - (ie. conferences, meetups)
- Guides - (ie. business formation, personal growth)
- Support - (ie. advice, communities, business strategies)
Our information and tools will provide educational sources, allow you to connect with other women entrepreneurs, and help you manage your business with ease.
TRUiC has created video guides to support and reinforce our on-page guides. These videos help to visualize the ideas and lessons that you need to know to create and run a successful business.
Check out our growing library of small business videos on the TRUiC YouTube channel.
Register as a Foreign LLC in Iowa
Forming a foreign LLC allows your company to operate as one entity in multiple states. If you have an existing LLC and want to do business in Iowa, you will need to register as a foreign LLC. This can be done by mail.
Register as a Foreign LLC in Iowa
Fee: $100 (Nonrefundable)
Secretary of State Business Services Division
Lucas Building, 1st Floor
Des Moines, IA 50319
How to Obtain a Certificate of Good Standing
A Certificate of Good Standing, known in Iowa as a Certificate of Existence, verifies that your LLC was legally formed and has been properly maintained. Several instances where you might need to get one include:
- Seeking funding from banks or other lenders
- Forming your business as a foreign LLC in another state
- Obtaining or renewing specific business licenses or permits
You can order an Iowa LLC Certificate of Existence online.
Order a Certificate of Good Standing
Request a Certificate Online
Fee: $5 (Nonrefundable)
Instructions: Enter your business name or business number, select your business, then select "Print Certificate of Existence."
Dissolve Your Iowa LLC
If at any point in the future you no longer wish to conduct business with your LLC, it is important to officially dissolve it. Failure to do so in a timely fashion can result in tax liabilities and penalties, or even legal trouble. To dissolve your LLC, there are two broad steps:
- Close your business tax accounts
- File the Articles of Dissolution
When you are ready to dissolve your LLC, follow the steps in our Iowa LLC Dissolution Guide.