Last Updated: June 10, 2024, 9:52 am by TRUiC Team

How to Start an LLC in Vermont (2024 Guide)

Wondering how to start an LLC in Vermont? We’ve got you covered.

To get started, you'll need to pick a suitable business name, choose a registered agent, and file your Articles of Organization with the Vermont Secretary of State ($125 processing fee). 

You can do this independently, consult with a business attorney for specialized legal guidance, or join the other 65% of our readers and hire a specialized Vermont LLC formation service (recommended).

four point eight out of five

Northwest ($29 + State Fees)

three point nine out of five

LegalZoom ($249 + State Fees)

Cost to Start an LLC in Vermont

How to Form an LLC in Vermont in 6 Steps

In order to form your LLC in Vermont, there are certain steps you’ll need to complete:

  1. Name Your Vermont LLC
  2. Choose a Vermont Registered Agent 
  3. File the Vermont LLC Articles of Organization
  4. Create an Operating Agreement
  5. Get an EIN
  6. File a Beneficial Ownership Information Report

Step 1: Name Your Vermont LLC

Before you get started, you will need to pick a suitable name for your Vermont LLC. 

This will need to comply with all applicable naming requirements under Vermont law and be both succinct and memorable, as this will make it easily searchable by your potential clients.

1. Important Naming Guidelines for Vermont LLCs:

  • 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

In addition to the rules outlined above, there are certain content restrictions placed on business names in Vermont. In particular, the state specifically prohibits the use of three types of language:

  • Discriminatory Language: This describes words or phrases that most people today would find insulting or offensive towards individuals or groups based on their race, color, religion, ancestry, where they come from, gender, sexual orientation, age, or disability.
  • Indecent Language: This includes words or phrases that the average person would find offensive, particularly those that refer to sexual organs or their functions.
  • Obscene Language: This group refers to words or phrases that would be considered sexually explicit, offensive, or threatening by contemporary community standards.

We recommend checking out the Business Naming Rules guidelines for a complete list of naming rules in this state.

2. Is the name available in Vermont?

To check whether your desired name has already been taken by another business entity in Vermont, you can perform a business entity name search on the Vermont Secretary of State website.

If you’re not going to start your LLC right away, it might be a good idea to consider reserving your name for up to 120 days ($20 processing fee).

For more information, you can have a look at our Vermont LLC Name Search guide.

3. Is the URL available?

You should check online to see if your business name is available as a web domain. Even if you don’t plan to make a business website right away, this is an extremely important step as it will prevent others from acquiring it, potentially saving you both time and money in the long term. 

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Once you have verified your name is available, you may now select a professional service to complete the LLC formation process for you.

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If you need additional information before getting started, you can have a look at our in-depth comparison of the Best LLC Services in 2024 instead.

FAQ: Naming a Vermont LLC

LLC is short for “limited liability company.” It is a simple business structure that offers more flexibility than a traditional corporation while still providing legal protection for your personal assets. Read our What is a Limited Liability Company guide for more information.

Or, watch our two-minute video: What is an LLC?

You must follow the Vermont LLC naming guidelines when choosing a name for your LLC:

  • Include the phrase "limited liability company" or one of its abbreviations (LLC or L.L.C.).
  • Do not use words that could confuse your business with a government agency (FBI, State Department, CIA, etc.).
  • A professional limited liability company (PLLC) must receive the proper licensing when using the words such as lawyer or doctor.

If you are having trouble coming up with a name for your LLC, use our LLC Name Generator. That will not only find a unique name for your business but an available URL to match.

Most LLCs do not need a DBA, known in Vermont as an assumed business name. 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 guide.

Step 2: Choose a Registered Agent in Vermont

After you find the right name for your LLC, you will need to nominate a Vermont registered agent. This is a necessary step in your Articles of Organization (i.e., the document used to file and register your LLC with the Secretary of State).

What is a registered agent? A registered agent is an individual or business entity responsible for receiving important tax forms, legal documents, notice of lawsuits, and official government correspondence on behalf of your business. You can think of your registered agent as your business’s primary point of contact with the state.

Who can be a registered agent? A registered agent must be a full-time resident of Vermont or a corporation, such as a registered agent service, authorized to transact business in the state of Vermont. You can choose to elect an individual within the company (e.g., yourself, etc.) or use a business attorney.

Get Free Registered Agent Services

Form an LLC with Northwest Registered Agent to get one year of registered agent services free of charge.

FAQ: Nominating a Registered Agent

Yes. You can choose to act as your own registered agent, appoint a member of your LLC, work with a business attorney, or hire a professional registered agent service (recommended). 

Read more about being your own registered agent.

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 Vermont registered agents.

Step 3: File the Vermont LLC Articles of Organization

To register your Vermont LLC, you'll need to file Form LLC-1(D): Articles of Organization with the Vermont Secretary of State. You can do this online, by mail, or in person.

Vermont LLC Formation Document

Before filing, make sure you have completed your Articles of Organization correctly. You will need to have filled in the following sections:

  • Your LLC’s entity name
  • A description of your business
  • The initial designated office of your LLC
  • The name and address of your LLC’s registered agent
  • The names of your LLC’s officers or directors (if applicable)

File the Articles of Organization

OPTION 1: File Online With the Vermont Secretary of State

File Online

- OR -

OPTION 2: File Form LLC-1(D) by Mail or In Person

Request Form

After requesting the Articles of Organization, the Secretary of State will email you a PDF form.

State Filing Cost: $125, payable to the VT SOS. (Nonrefundable)

Filing Address:
Vermont Secretary of State
Corporations Division
128 State St.
Montpelier, VT 05633

For help with completing the form, visit our Vermont Articles of Organization guide.

Note: If you're expanding your existing business to the state of Vermont, you'll need to register as a foreign limited liability company (LLC).

FAQ: Filing Vermont LLC Documents

According to the Vermont Secretary of State’s Business Services Division, online filings are usually processed in less than a day (at no extra cost), while filings submitted by mail typically take between 7 and 10 business days.

An LLC is referred to as a "domestic LLC" when it conducts business in the state where it was formed. A foreign limited liability company 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.

It costs $125 to file your LLC’s Articles of Organization with the Secretary of State, though the total cost of starting your Vermont LLC may vary depending on whether you hire a professional service.

To learn more, read our guide on the cost to form a Vermont LLC.

Step 4: Create a Vermont LLC Operating Agreement

An operating agreement is not required for an LLC in Vermont, 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 LLC members are on the same page and reduces the risk of future conflict.

For more information on operating agreements, read our Vermont LLC operating agreement guide.

FAQ: Creating a Vermont LLC Operating Agreement

No. The operating agreement is an internal document that you should keep on file for future reference. However, many other states legally require LLCs to have an operating agreement.

Step 5: Get an EIN for Your Vermont LLC

You can get an Employer Identification Number (EIN) from the IRS for free. It is used to identify a business entity and keep track of a business's tax reporting. It is essentially a Social Security number (SSN) for the company.

Why do I need an EIN? An EIN number 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 get an EIN. Learn more here.

Get an EIN

Option 1: Request an EIN from the IRS

Apply Online

- OR -

Option 2: Apply for an EIN by Mail or Fax

Download Form

Mail to:
Internal Revenue Service
Attn: EIN Operation
Cincinnati, OH 45999

Fax: (855) 641-6935

Fee: Free

FAQ: Getting an EIN

A Social Security number is not required to get an EIN. You can simply fill out IRS Form SS-4 and leave section 7b blank. Then call the IRS at (267) 941-1099 to complete your application. Learn more about applying as an international applicant.

All LLCs with employees, or any LLC with more than one member, must have an EIN. This is required by the IRS.

Learn why we recommend always getting an EIN and how to get one for free in our Do I Need an EIN for an LLC guide.

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 LLCs can reduce their federal tax obligation by choosing the S corporation (S corp) status. To learn more, read our LLC vs. S Corp guide.

Step 6: File a Beneficial Ownership Information Report

Beginning January 2024, LLC owners will need to file a Beneficial Ownership Information (BOI) Report with the US Financial Crimes Enforcement Network (FinCEN). Existing LLCs can file their report any time between January 1, 2024, and January 1, 2025, while new LLCs will need to file their report within 90 days of formation

This contains similar information to that of your Articles of Organization, such as your LLC name and member information, and can be filed online for free. Failure to file an accurate report on time can result in a $500 per day fine.

Note: There are certain filing exemptions, such as for large companies (i.e., more than 20 full-time employees), tax-exempt entities, and publicly traded companies. 

Considering Using an LLC Formation Service?

We reviewed and ranked the top LLC formation services. Find out which is best for you.


Maintain Your Vermont LLC

After you’ve successfully formed your LLC, there are a couple of steps you’ll need to periodically take in order to maintain it, including:

  • Filing an annual report
  • Sorting out your tax responsibilities

We’ve broken down how to complete each of these steps in greater detail below.

File the Annual Report

All LLCs based in Vermont must renew their business registration each year by submitting an annual report online. The report is intended to keep the state up-to-date with important information regarding your LLC, including its:

  • Legal name.
  • Business ID (which can be found on the Vermont Business Database).
  • Principal and mailing address.
  • Business email address.

This report is due within 2.5 months of the end of the previous fiscal year, alongside a filing fee of $35. Take care not to miss the deadline, as failing to do so incurs a $25 reinstatement fee or even a revocation of your LLC's registration.

Sort Out Your Taxes

Regardless of where your LLC is registered, you will be required to pay certain federal taxes. This includes corporation and employer taxes (for LLCs filing as a C corporation), and federal income tax and self-employment taxes (for LLCs taxed as pass-through entities).

In addition, there are a number of different taxes you’ll be required to pay at a local and state level, which can vary depending on the nature of your business.

Below are some of the most common taxes in Vermont:

Income Taxes

Owners of Vermont LLCs need to be aware of several key statewide taxes that could be imposed on their business’s earnings. In addition to your federal income responsibilities, these include:

  • Individual Income Tax: This graduated tax is set at rates ranging from 3.35% to 8.75% on the distributions an LLC’s members take from the business’s total earnings.
  • Business Entity Income Tax: LLCs organized as an S corp or partnership are required to pay Vermont’s business entity income tax (BEIT), which has a minimum fee of $250 every year. This is paid by the LLC in addition to the individual income taxes its members must pay.
  • Corporate Income Tax: All corporations (including LLCs opting to be taxed as C corps) are required to pay this income tax at a rate that varies between 6% and 8.5% depending on their net income.

All income tax returns can be submitted quickly and easily online through the Vermont Department of Taxes myVTax platform.

Sales Tax

All businesses based in Vermont selling tangible personal property within the state will be required to collect sales tax from their customers at a general rate of 6%. Use tax is levied at the same rate on businesses that don’t register for sales tax (i.e., retailers based outside of the state). 

On top of this, local municipalities in Vermont are also able to impose an additional sales tax rate up to a maximum of 1%. To file a Sales and Use Tax Return, your LLC can either submit Form SUT-451 to the Vermont Department of Taxes or file online for free using myVTax.

Note: For your LLC to be able to collect sales and use tax, it will first need to sign up for a Vermont Business Tax Account with the Vermont Department of Taxes using the Online Business Service Center.

Property Tax

Property taxes in Vermont are primarily managed at a local level, with each county having its own procedures for property tax assessment and collection. As such, the property tax bill your LLC is faced with can vary greatly depending on where it’s based within the state. 

LLCs owning any real or personal property in the state, such as land and buildings, will need to report the total value of this property by April 1 to the Vermont Department of Taxes and then file a property tax return by April 15 of each year.

Note: The Vermont Secretary of State website provides a compilation of resources you can use to get a better idea of how property taxes will work for your LLC.

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Steps After LLC Formation

After forming your LLC, you will need to get a business bank account and website, sort out any required business licenses, and get business insurance, among other things. 

Visit our After Forming an LLC guide to learn more.

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