Businesses in Utah looking to legitimize their operations but lack the excess resources and cash should think about forming a Limited Liability Company. An LLC combines the limited liability of a corporation without disrupting the owner’s rights to operate as a sole proprietor or partnership.
It’s an excellent option for legally structuring your business as it keeps your personal and professional finances separate, which ensures any personal assets are protected in the case that your company is ever sued or experiences losses.
The costs to get your LLC up and running are relatively low, and the overall process is straightforward; all you have to do is follow the exact steps outlined below to make sure your LLC is registered correctly.
How to Form an LLC in Utah – A Step by Step Guide
You can apply for your LLC on your own or through a professional service. While filing on your own isn’t complicated and doesn’t take too much time, you still want to make sure you complete each step as outlined below, ensuring your LLC is set up correctly the first time around.
If you’d rather not handle your business’s legal side, we suggest using an LLC formation service to file all your business paperwork for you (a more worry-free approach).
Otherwise, if you’re a do-it-yourself kind of person, follow these 5 initial steps:
1. Name your Utah LLC
To form an LLC in Utah you need to follow specific name requirements set by state law. Your business name needs to be unique, meaning no other company has a similar name.
Before checking to see if the business name you’d like is available, to abide by Utah LLC law, make sure the name of your company contains one of the following:
- Limited Liability Company
- Limited Company
Your LLC name can be your business name, like Plumbing King L.L.C, or the name of one of your LLC’s members, such as Joe Smith LLC.
Check Name Availability
Once you’ve decided on your name, you need to check to see if it’s available and there’s no other company in Utah using it. The quick and easy way to do this is through a quick google search using your desired name.
If you don’t find any competing companies, you can move onto the next step – checking your business’s potential name through the Utah business name search.
If you find a name you like that’s available, but you’re not quite ready to file your LLC yet, you can fill out an ‘Application for Reservation of Business Name’ to reserve that name for up to 120 days. Reservations can be filed online using the Utah Online Business Registration portal or printed and mailed to the Utah Division of Corporations. It costs $22.
Using a Fictitious Name
If you don’t want to use LLC in your business name, then you can add a fictitious name once your business is registered. Also known as DBA (“doing business as,”) or a trade name, a fictitious name allows you to run your business under a name that’s not the legal LLC registered name.
You can also use a fictitious name if you plan on running several different businesses under your LLC formation.
If you’d like to register a fictitious name, you need to register that name through the Utah Online Business Registration portal. It costs $25.
Once you’ve figured out what your business name is and you’ve made sure it’s still available, the next step is to choose a registered agent who will help you with the legal side of your business.
2. Choose a Utah Registered Agent
A registered agent is anyone who receives and sends legal documents on behalf of your company. They are the main point of contact between your company and the Secretary of State.
Utah, an LLC must have a registered agent who lives in Utah and has a valid street address (not a P.O. box).
An LLC registered agent can be:
- A family member or friend
- A Commercial Registered Agent
Why you should use a registered agent
While the easier route seems to have yourself, or one of your LLC’s members, act as the registered agent, there are some benefits in hiring a professional. A registered agent will ensure your business is always in good standing with the state, helping you stay organized and up-to-date. It also adds a layer of protection since they’ll help you in the case of a lawsuit or any penalties/fines.
Once you’ve decided who’s the best person to be your registered agent, the next step is to submit your LLC application.
3. File a Utah LLC Certificate of Organization
The form for filing an LLC in Utah is called the ‘Certificate of Organization.’ Applications are sent through the Utah Online Business Registration portal. Expect to pay a $70 filing fee.
If you fill out the form with inaccurate information, your writing is illegible or you skip a section, your application will be refused. Be prepared to include the following information (and always read it over once before submitting):
- Your LLC’s name
- The address of your LLC’s principal office
- The name and address of your LLC’s registered agent
- The signature of the organizer
- The Name and address of members or managers (optional)
- Your LLC’s duration (optional)
- Your LLC’s purpose (optional)
What’s the difference between member-managed or manager-managed?
Member-managed is if you (and the other owners of your LLC) are responsible for everyday business activities. In contrast, manager-managed is if you decide to hire someone who is not a member to manage your business’s day-to-day activities.
Member-managed is more common for smaller businesses, while larger companies typically use manager-managed. You’d usually only choose manager-managed if you are a passive investor and aren’t involved much in the business.
Once you get approval, you can move onto step 4 – creating an LLC Operating Agreement. If you’re operating your LLC by yourself, skip to step 5.
4. Create a Utah LLC Operating Agreement
If your LLC has two or more members, it should have an operating agreement. Although it’s not required in Utah, we suggest creating one to outline how the business is structured and how it will operate among its members (and/or managers).
Some of the sections you’ll typically find covered in an operating agreement include:
- Capital distributions
Again, while this is not a necessary step, as you don’t have to mail it to the secretary of state, it is recommended if your LLC has more than 2 members. It helps clarify the rules of your LLC and makes sure they are legally documented.
After you’ve agreed and created an LLC Operating Agreement, the next step is to create your unique employer identification number.
5. Apply for your Utah LLC Employer Identification Number (EIN)
Once your LLC is approved, you’ll need to get an employer identification number (EIN).
An EIN is a federal tax ID number that registers you with the Internal Revenue Service (IRS). This number identifies your company when filing taxes.
How to register for an EIN:
– Apply online or,
– fill out the Employer Identification Number form and fax it to 855-641-6935, or mail it to:
Internal Revenue Service,
Attn: EIN Operation,
If you apply online, you’ll get instant approval. If you apply by fax, it takes up to 4 business days, whereas mailing can take up to 4 weeks. Applying for your EIN is completely free!
Utah LLC Registration – Final Checklist & Summary
Ready to get started? Use this simple checklist to make sure you’ve dotted your i’s and crossed your t’s!
- Name your LLC – LLC’s in Utah are required to have ‘Limited Liability Company’ or ‘Limited Company’ in its name, or the abbreviation(s): LLC, L.L.C, LC, or L.C. Always check the Utah business database to make sure that your name is not already taken or similar to another business in the state.
- Choose a Registered Office – A registered agent is a person who receives and sends legal documents on behalf of your company. It can be you, a friend or family member, or a commercial registered agent.
- File a Utah LLC Certificate of Organization – The file for creating an LLC in Utah is called the Certificate of Organization. It’s important that you fill out the certificate accurately. It costs $70 to file, which you can do directly through the Utah Online Business Registration portal.
- Apply for your Utah LLC Employer Identification Number (EIN) & File your Tax Registration Form – Once you get approval for your LLC, you need to apply for an employer identification number (EIN) through the IRS. This number identities your company when filing taxes. You can apply online for free, and approval is instant.
- Create Utah LLC Operating Agreement – If your LLC has two or more members, you should create an LLC operating agreement that outlines how the business is structured, who is responsible for what, and how much of the LLC each person owns. You don’t have to send your operating agreement to the Utah state, but you should have one, so everything is documented and signed by all members.
Always double-check your LLC information is correct before submitting any paperwork. You want to avoid simple mistakes and ensure your business is set up correctly from the get-go. If it’s within your budget, we recommend using a formation service to help form your LLC. They can act as your registered agent and make sure your company is always in good standing. Just make sure you do your homework and choose one of the best LLC services for your business.
Our first recommendation is to go with ZenBusiness, an LLC creation service that holds your hand from start to finish. Packages start as low as $49.
How To Apply for a Utah LLC Online
Now that you know the exact steps on what’s needed to form your LLC, it’s time to start the application process. There are two ways of going about this:
1. Do it Yourself
Taking the DIY route is a good option if your budget is tight or you’ve previously opened an LLC and understand how it works.
2. Use an Online Formation Company
Using an online formation company is a better option if it’s your first time opening up an LLC and if it’s within your budget (formation services cost anywhere between $49 – $199). This is typically a better choice if you want to avoid headaches and have peace of mind knowing professionals handle everything for you.
If using a professional service is more up your alley, here are our top 3 recommendations:
ZenBusiness built its platform to meet the needs of your business throughout its lifetime. When you pay for their services, you’ll receive a personalized dashboard for your business to store documents, receive alerts, and manage your website.
ZenBusiness charges work on a tier system. There are three different tiers with pricing as follows:
- The Starter = $49 annually
- The Pro = $199 annually
- The Premium = $299 annually
IncFile provides you with a full suite offering startup services to best support your business formation.
Their pricing model also depends on the state you are filling. You can generate a personalized quote on their website by entering the necessary information about your business.
LegalZoom is an online legal service provider that helps you to be able to create legal documents without having to pay the expensive lawyer fees. Some of the services they provide assistance to includes business formation, copyrights, and trademarks.
LegalZoom has many different pricing options available. For their LLC service, pricing begins at $79 + the allotted state fee.
After Starting Your Utah LLC
You’re approved – now what? The journey doesn’t stop here – there’s still a handful of things you need to do to get your business off the ground. We recommend ticking off the following items to make sure your LLC gets off on the right foot.
Purchase A Domain For Your Business
Even if your business is local, having an online presence is essential in creating trust, professionalism, and a way for people to find you. If you haven’t already thought about getting a website, now’s the time. In a tech-saturated world, you need a domain to not only attract new customers but help create a good first visual impression of what your business does and how it can help.
Get A Business Phone Number
Since your business is now an approved Utah LLC, you should think about getting a business phone number. Having a business number is a great way to show professionalism to your clients and customers. It makes you more serious and, more importantly – more trustworthy.
There are various online phone services you can go with, or you could go the traditional route and open an account through a local branch. You can get a local number or a 1-800; the options are endless!
Open Your Utah LLC Business Bank Account
You’ll want to open a business account that’s separate from your personal banking. This will not only make accounting easier, but you won’t have to worry about your finances mixing in with your business finances.
USA Business Bank Accounts
If you already have online banking, it might be easier to open a business account through your current bank, so all your banking (although in separate accounts) will be accessible in the same place. If you prefer to open something new, keep these checking accounts in mind:
Chase – Free checking account with no extra fees – as long as you keep a $1,500 minimum balance.
BlueVine – Free checking account with mobile banking and a debit MasterCard.
Bank Novo – Open a free checking account with Free transfers and free ATM fees.
UCCU – Open a business checking account through this local not-for-profit credit union. Choose between a basic checking account or a commercial checking account.
1st Utah Bank – Open a local account to help manage your finances and cash flow effectively. Choose between a free business account, a commercial account or a nonprofit checking.
Along with your business checking account, you should apply for a business credit card too. Having a business credit card is an excellent way to establish your business credit score (which may help if you ever need a loan). It also makes it easier for online purchases, and again, it will keep your personal and business finances separate.
Find Accountant/Buy Accounting Software
Taxes get complicated fast and can be a burden to handle. We recommend getting an accountant or using accounting software to ensure all your spending actions are tracked (payroll, bills, invoices, receipts, etc.). Here are some popular options to look into:
Wave – Free invoicing & accounting software with credit card processing & payroll services.
Intuit Quickbooks – Online accounting software to track expenses, customize invoices, and run reports.
Freshbooks – Accounting software to send invoices, track time, manage receipts, expenses, and accept credit cards.
Directory of Federal Tax Return Preparers with Credential – If you want to use a local tax specialist, you can search for a certified public accountant (CPA) through the IRS online directory.
Having all of your business reports in one spot is highly beneficial, so you can keep an eye on your cash flow. To run a successful business, you will need to analyze how your business performs and narrow down what’s working or what isn’t working. Finding areas for growth will ensure success.
Don’t Forget to File an Annual Renewal
In Utah, LLCs are required to file an annual renewal (sometimes called an annual report in other states). This is mandatory to keep your business active and in good standing with the state.
Renewals are due one year after the date of your LLC’s formation. For example, if your LLC was formed on September 30th, 2021, then you’d need to submit your first annual renewal before September 30th, 2022.
60 days before your LLC’s anniversary date, the Utah Division of Corporations will send a renewal notice to your registered agent. It costs $20 to file an annual renewal, which you can do through the Utah Online Business Registration portal. Failure to submit a renewal will result in the state dissolving your LLC.
Notify Utah Of Any Changes You Make To Your LLC
If at any time you make changes to your LLC you need to inform the state. If you’re using a registered agent they can do this for you. If you’re going about this alone, you can update changes through Utah’s business portal or through your registered agent.
8 Benefits of Forming an LLC in Utah
Setting up an LLC in Utah makes sure your business finances stay separate from any personal finances and that each member’s personal possessions are safe. It’s a great business entity for small, medium or large businesses as it gives you the freedom of a sole proprietorship or partnership with the protection of a corporation. Best of all, it’s easy to get (approval is instant), and it won’t cost you an arm and a leg. Some of its major benefits include:
1. Protect Your Personal Assets
The LLC will have its liability that does not automatically extend to the owners, unlike a sole proprietor, where you are legally responsible for everything. That means Utah LLC protects the liabilities and debts incurred by the business. In most situations, your assets, such as your car, home, or savings, will never be at risk if your Utah LLC is faced with lawsuits or bankruptcy.
2. Benefit From Business Profit Taxation
In an LLC in Utah, your profits and losses can pass through to your income without having to have corporate taxation.
3. Simple to Create and Maintain
The formation of a Utah LLC requires minimal paperwork and requirements. They are known for being easy to start and simple to maintain.
4. Minimal Restrictions
Your business matters can be managed by more than one owner or member while still being one main business to the public. This means all decisions and transactions behind the scenes can be equitably distributed while presenting one entity as you move forward.
5. Heighten Your Credibility
As you move forward, your UtahLLC will continuously be recognized as an entity. People and other businesses prefer doing business with a legitimate entity because it shows your level of professionalism.
6. Gain Access to Business Loans
When you form your Utah LLC, you will obtain a DUNS number and build your business credit, helping you to further build upon your business.
7. Benefit From Flexible Profit Distribution
In an LLC, you are not required to spread the distribution of profits equally across the owners. You have complete control over profit distribution in your Utah LLC.
8. Good For Any Kind Of Business
An LLC business structure in Utah is an excellent choice for both medium and higher-risk level businesses. You might always want to consider opting to go with an LLC if you have a significant amount of personal assets to protect from your company. And lastly, LLCs are great for owners who are interested in paying lower tax rates than corporations.
A Limited Liability Company is a strong option for businesses in Utah that are looking for stronger legal and financial support. It’s a great business entity for any business owner, whether you’re a small, medium, or large company. Since the cost is inexpensive, it’s a quick and easy way to ensure your personal and business assets stay separate and that you’ll have legal protection in case your company ever runs into financial problems.
The entire process is easy and straightforward, as long as you remember to follow each step as listed above and don’t forget to follow up with any additional steps (like annual renewals). If it’s within your budget, we always suggest using a formation service, such as ZenBusiness, who can help you fill out forms, act as a registered agent and overall handle the legal side of your company. Doing so will ensure your LLC is formed properly on the first try.
FAQ. About Forming Utah LLC
There are several different steps you’ll need to take to form your LLC legally. It’s a lot of information to take in and can get confusing. To help out, we’ve compiled some answers to the most frequently asked questions:
What are LLCs, and why are they important?
An LLC is a Limited Liability Company. It’s a business structure used to protect your assets, like your house, your car, or even your savings. No matter what happens to your business (lawsuits, bankruptcy, etc.) your assets are kept safe.
How much does it cost to start an LLC in Utah?
It costs only $70 to file the ‘Certificate of Organization’ that’s used to form your LLC.
Can you start an LLC on your own?
Yes, you can start forming an LLC on your own by following the step-by-step instructions provided in this article. For additional help, look to hire an all-around service provider.
Do you need a lawyer to start an LLC in Utah?
No, you can start an LLC without a lawyer just be prepared to file and report everything on your own. If you’re not interested in getting a lawyer but want to make sure everything is filed correctly, use an online business formation service, like the ones listed in this article, with ZenBusiness as our #1 recommendation.
Does an LLC need to make money?
No, an LLC doesn’t need to make profits, but if you’re claiming tax deductions with no income, the IRS will likely audit your business.
What are the downsides to having an LLC?
There are pros and cons to forming an LLC. The pros are tax reductions, protecting your personal assets, and creating credibility for your business (and possible future business loans). The main con of an LLC is you’re considered self-employed. This is a disadvantage as you’d be taxed under self-employment and responsible to pay Social Security and Medicare taxes. The amount you’d be required to pay depends on your business’s total net earnings.