How to Set Up an LLC

Setting up an LLC involves name selection, a registered agent, state filing, an EIN, and an operating agreement. Here's everything you need, step by step.

Setting up an LLC means more than filing one form — it is the full process of turning your business idea into a legally recognized entity that is ready to bank, hire, and pay taxes. The complete setup includes name selection, a registered agent, a state filing, an EIN, and an operating agreement.

To set up an LLC, you complete five core steps: choose a name, appoint a registered agent, file formation documents with your state, get an EIN from the IRS, and draft an operating agreement. Most owners finish the entire setup in one to two weeks.

What It Means to Set Up an LLC

Setting up an LLC is broader than just registering the entity. Registration creates the legal shell; setup makes that shell operational. That means the state filing, the federal tax ID, the internal rules in your operating agreement, and the bank account that keeps your business finances separate from your personal ones. Each piece plays a role: the filing makes the LLC legal, the EIN makes it real to the IRS, the operating agreement makes it runnable, and the bank account makes it financially independent from you.

Step 1: Pick a Name That Meets State Rules

Your name must be distinguishable from other business names registered in your state and must end with a designator like "LLC" or "L.L.C." Avoid words that are restricted by state law, such as "bank," "trust," or "insurance," unless you hold the appropriate license. Run a free search on your state's business database before committing.

Step 2: Appoint a Registered Agent

Every LLC must maintain a registered agent in its state of formation. The agent must have a physical street address — not a PO box — and must be available during business hours to accept legal documents. You can serve as your own agent, or pay a service roughly $50 to $300 per year to handle it for you.

Step 3: File with Your State

Submit your formation documents to the Secretary of State, online or by mail, and pay the filing fee. Fees range from approximately $40 to $500 depending on the state and change frequently, so confirm the current amount on the official state website. Online filing is typically faster and less expensive than mailing paper forms.

Step 4: Get an EIN

Apply for an EIN through the IRS website — the application is free and you receive your number immediately. You will use it to open a bank account, file taxes, and hire employees. Even single-member LLCs benefit from an EIN because it keeps business activity off your personal tax ID.

Step 5: Draft an Operating Agreement and Open a Bank Account

An operating agreement is the internal rulebook for your LLC: it defines ownership percentages, how profits are split, voting rights, and management duties. Most states do not require one, but it is essential for multi-member LLCs and strongly recommended for single-member LLCs. For guidance, see what an LLC operating agreement is.

Finally, open a dedicated business bank account using your EIN and formation documents. This step protects your limited liability by keeping business money separate from personal money. For the full registration checklist, review how to start an LLC. As of 2026, the entire setup can be completed online in most states, and the operating agreement and bank account are the two steps owners most often skip — and later regret skipping.

Frequently Asked Questions

How do I set up an LLC?

Choose a name, appoint a registered agent, file formation documents with your state, and pay the filing fee. Then get an EIN from the IRS, draft an operating agreement, and open a business bank account. Most states allow online filing with approval in a few business days.

What is needed to set up an LLC?

You need a unique business name, a registered agent with a physical address in your state, formation documents, and the state filing fee. After approval, you need an EIN from the IRS, an operating agreement, and a business bank account to operate fully.

Is an operating agreement required to set up an LLC?

Most states do not require one, but it is strongly recommended. The operating agreement records ownership, profit splits, and management rules, which prevents disputes and helps preserve liability protection. Multi-member LLCs especially should have one in writing, and banks and investors often ask to see it.

How long does it take to set up an LLC?

The state filing is usually approved in 1 to 5 business days online or 2 to 8 weeks by mail. The EIN is issued instantly online. With an operating agreement and bank account, most owners complete the full setup within one to two weeks.