How to Form an LLC in Tennessee: A Step-by-Step Guide

Forming a Limited Liability Company (LLC) in Tennessee can be a straightforward process if you follow the right steps. In this article, we will guide you through the process of forming an LLC in Tennessee, including the necessary documents, fees, and requirements.

Why Form an LLC in Tennessee?

Tennessee is a popular state for business owners due to its business-friendly environment, low taxes, and minimal regulations. Forming an LLC in Tennessee can provide you with personal liability protection, tax benefits, and flexibility in management and ownership.

Step 1: Choose a Business Name

The first step in forming an LLC in Tennessee is to choose a unique and available business name. The name must be distinguishable from other business names in the state and must not contain any words that are prohibited by the state. You can search for available business names using the Tennessee Secretary of State's database.

Once you have chosen a business name, you must reserve it by filing a Name Reservation Application with the Tennessee Secretary of State's office. This will prevent anyone else from using the same name for 120 days.

Step 2: Appoint a Registered Agent

A registered agent is a person or business that agrees to receive service of process and other official documents on behalf of your LLC. The registered agent must have a physical address in Tennessee and must be available during business hours to receive documents.

You can appoint yourself as the registered agent or hire a professional registered agent service. If you appoint yourself, you must provide your name and address to the Tennessee Secretary of State's office.

Step 3: File the Articles of Organization

The Articles of Organization is the primary document required to form an LLC in Tennessee. This document must include the LLC's name, address, purpose, and management structure. You can file the Articles of Organization online or by mail with the Tennessee Secretary of State's office.

The filing fee for the Articles of Organization is $300, and you must pay an additional $50 for the name reservation application. You can pay the fees online or by check.

Step 4: Create an Operating Agreement

An operating agreement is a document that outlines the ownership, management, and operation of your LLC. This document is not filed with the state, but it is essential for internal purposes. The operating agreement should include the LLC's purpose, ownership structure, management responsibilities, and financial obligations.

Step 5: Obtain an EIN

An Employer Identification Number (EIN) is a unique number assigned to your LLC by the IRS. You will need an EIN to open a business bank account, hire employees, and file taxes. You can apply for an EIN online through the IRS website.

Step 6: Obtain Business Licenses and Permits

Depending on the type of business you operate, you may need to obtain business licenses and permits from the state or local government. You can check with the Tennessee Department of Commerce and Insurance or your local government to determine the necessary licenses and permits.

Conclusion

Forming an LLC in Tennessee can be a straightforward process if you follow the right steps. By choosing a unique business name, appointing a registered agent, filing the Articles of Organization, creating an operating agreement, obtaining an EIN, and obtaining business licenses and permits, you can establish a successful LLC in Tennessee.