How to start an LLC in Iowa in 2024

Many new business owners start out as a sole proprietorship. However, an LLC can provide a buffer between you and your business, adding a layer of protection and reducing personal liability. If you’re considering setting up an LLC in Iowa, this step-by-step guide will walk you through how to start an LLC, the associated costs and offers resources to help you through the process.

Here are the steps to starting an LLC in Iowa:

• Create an Iowa fast track filing account. 
• Name your LLC.
• Decide on a registered agent.
• File your certificate of organization. 
• Create an operating agreement. 
• Obtain an EIN.
• File a biennial report as needed. 
• Apply for business permits and licenses as needed.

“Typically, setting up an LLC is quick and easy. Especially when the LLC has only one owner, or the multiple owners agree to share everything based on fixed percentages,” says Jeremy Babener, expert business advisor and president of Structured Consulting.

8 Steps to start an LLC in Iowa 

1. Create an Iowa fast track filing account 

For the quickest Iowa LLC setup, create a fast track filing account. Using the fast track filing system, complete key LLC formation and maintenance tasks, including:

• Reserve an LLC name. 
• Set up an LLC in Iowa. 
• Change registered agents. 
• Dissolve your business. 
• Submit amendment filings and biennial reports. 

To create an account, you’ll need to provide some personal information, including your name, organization, address, email and password. 

2. Name your LLC 

Securing a business name that reflects your products or services is key. You want something that is good for branding and marketing, recognizable and ideally available as a URL and social-media handle.

Begin your name selection process by brainstorming a few names you want to consider. As you do, remember that Iowa has a list of unacceptable words for use in an LLC name. They include:

• Government agencies such as “FBI,” “treasury” and “state department.”  
• Bank.
• Any words that denote a profession that usually requires additional licenses you don’t  have, such as “doctor,” “lawyer” or “university.” 
• Fictitious or expired names. 

Once you’ve brainstormed some acceptable names, use the Iowa secretary of state’s business entity search tool to find out which one(s) are available for use in Iowa. If the name you want is already in use, there are several ways to make it unique, including:

• Adding a different letter or multiple letters.
• Re-arranging the sequence of letters.
• Adding a space. 
• Making the name singular or plural. 
• Adding a number. 

Some name modifications aren’t acceptable based on Iowa code. These include:

• Using the words or abbreviations for “corporation,” “company,” “incorporated” or “limited.” 
• Changing “LLC” to “limited liability company” or adding periods to the abbreviation (i.e., L.L.C.). 
• Adding characters or punctuation, such as an exclamation point, a dash or a hyphen. 
• Changing how capitalization occurs in the name or differentiating “and” with the ampersand symbol (&). 

In addition, do a search of your desired business name using the United States patent and trademark office’s trademark electronic search system (TESS). This will help ensure your name is not nationally protected from infringement by another U.S.-based company.

If you’re not ready to submit your LLC formation paperwork, you can reserve your business name for up to 120 days using Iowa’s fast track filing system. Log into your account and click “business filings” at the top of the page, then “file a document” from the drop-down menu. Click “application for reservation of name” on the next page to begin the name reservation process. The filing fee is $10. 

3. Decide on a registered agent 

Iowa requires you to appoint a registered agent before submitting your LLC formation paperwork. A registered agent receives important legal and other business paperwork on your company’s behalf. The consequences of not having a registered agent present during all regular business hours include the forced closure of your business and forfeiting the right to a defense should your LLC be sued. 

A registered agent acting on behalf of a business must meet the following criteria: 

• Have a physical address in Iowa (no P.O. boxes allowed). 
• Be able to receive correspondence during business hours. This means not leaving the designated registered agent address for sick leave or to meet with a client. 
• If an individual, is at least 18 years of age or older. 
• If an individual, resides in the state of Iowa. 
• If a business, be legally authorized to do business in Iowa. 

Being available consistently during all business hours throughout the year can be a tall order for anyone, which is why opting for a registered agent service is often an attractive option. A registered agent service allows you to outsource this process. In exchange for an annual fee, you can take these responsibilities off your plate and receive the following benefits:

• Keep your home or business address private. If you act as your own registered agent and work from home, your home address will be public. If you hire a service, their address will be public instead.
• Have more freedom and flexibility. Registered agents are required to be available during all business hours. That can make it tough to leave for meetings, head out for lunch or take advantage of the freedom and flexibility that self-employment allows. Hiring a registered agent fulfills your requirement without these restrictions.
• Maintain confidentiality. If there are matters you’d like to keep private, like your LLC getting sued, a registered agent service can discreetly handle this correspondence so you avoid tricky situations, such as legal paperwork being delivered in front of employees or customers. 
• Easy compliance fulfillment. Many registered agent services process documents for you and notify you when they’re uploaded to your online portal via text or email. Many also offer online calendars alerting you when filing deadlines and other compliance requirements are due. 

The fee to hire a registered agent service ranges from $0 to $300 per year. Some LLC formation services, such as Bizee and Inc Authority, offer free registered agent services for the first year when you form a business through the provider. To learn more about choosing the right registered agent service for your LLC, read our best registered agent services guide. 

4. File your certificate of organization

Your certificate of organization, once processed, marks the legal beginning of your LLC’s existence. Iowa does not offer a template form to fill out as your certificate of organization. For this reason, you will need to create your own or use a free Iowa LLC articles of organization template offered online by companies such as Northwest Registered Agent. To file your certificate of organization, you’ll need to provide the following information: 

• The name of your LLC. 
• The duration of your company (i.e., perpetual). 
• The purpose of your LLC. 
• The name and address of your registered agent. 
• The street and mailing address(es) of your LLC. 
• The names and addresses of the members who will run your LLC’s operations. 
• The amount each member contributed to the business. 
• Your signature and signing date.

Once the form is complete, you can submit it by logging into your Iowa fast track filing account, and clicking “business filings” at the top of the page. When the drop-down menu appears, click “file a document.” From the list of forms, click “form an Iowa limited liability company.” You will be asked to provide the following information:

• Whether you are a domestic LLC or a domestic professional LLC. (You’re most likely forming a domestic LLC if you are not formed entirely of licensed professionals.) 
• Your LLC’s name and address. 
• The date you wish your LLC to form (called the effective date). 
• The expiration date of your LLC. (If you don’t have one, you can check the “perpetual” box.) 
• Your certificate of formation in PDF format. 
• Your registered agent’s name, address and email address.
• The signature of the “organizer” (the person filing the certificate of organization”). 
• A payment method, such as a credit or debit card. The fee to file your certificate of organization is $50. 

After submitting your certificate of organization via the fast track system, your information will be reviewed by the Iowa secretary of state’s office. When everything is finalized, you’ll receive an email letting you know your certificate was approved. Your LLC’s birth date will be either the date in which your certificate of organization was approved or the effective date you requested. 

From there, you can log into your fast track filing account and print out your certificate of organization by clicking “business filings,” then “ dashboard” and “approved filings.” Locate your certificate and print it.

New LLC reporting requirement alert 

The U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) has implemented a new reporting requirement for all non-exempt LLCs starting on January 1, 2024. 

The requirement is called the Beneficial Ownership Information (BOI) report and it is estimated to only take about 20 minutes to complete. 

Here’s what you need to know:

• LLCs formed before January 1, 2024 have until January 1, 2025 to file.
• LLCs formed between January 1, 2024 and January 1, 2025 have 90 days to file from the confirmed date of the businesses’ registration.
• New LLCs formed after January 1, 2025 will have 30 days to file from the confirmed date of formation.

For all details, FAQs and to file, visit FinCEN’s BOI website. 

5. Create an operating agreement 

While an operating agreement isn’t mandated by the state of Iowa, it is a key document for your business’s healthy continuity. It offers operating guidelines and rules that are legally binding for all members who sign it. These rules and guidelines supersede the default LLC operating rules set by the state, giving you more control over the operating needs of your business. Other benefits of an operating agreement include enhanced protection from member personal liability for company activities or debts and a clarification of guidelines to prevent or resolve member disputes.  

Operating agreements often include various provisions to help set a standard for business decisions and financial matters. Typically, they include the following:

• The LLC’s legal name and address. 
• The names and addresses of all members. 
• Members’ voting rights and responsibilities. 
• Each member’s ownership percentage.
• How profits and losses are distributed. 
• What happens to the LLC if a key member dies or the opportunity to sell the LLC arises. 
• How and when member meetings are held. 
• The contact information of your LLC’s registered agent.
• Your LLC purpose statement. 

LLC formation services may provide operating agreements at no cost or as an add-on to your plan. For example, Rocket Lawyer and Northwest Registered Agent offer free operating agreement templates, whereas ZenBusiness offers one in its Pro and Premium plans or for a separate fee of $125. Remember, the final document is legally binding even if you use a free template. So, we recommend that a business attorney review the document before your members sign it to ensure it meets your unique business needs. 

Once you have an operating agreement finalized and signed by all members, keep it in your records with other important business documents, such as your certificate of organization. 

6. Obtain an employer Identification Number (EIN)

Next, submit an application for an employer identification number (EIN). This number identifies your business much like a Social Security number identifies a person. It is useful for completing key business tasks, such as applying for a loan, opening a bank account, obtaining business permits, hiring employees and filing taxes. 

You can apply for an EIN via the IRS online at no cost.  As the business owner, you are considered a “responsible party” within your LLC and must provide your name and Social Security number when you apply for an EIN. You may only apply between business hours, 7 a.m. and 10 p.m. Eastern Time, Monday through Friday, and the application must be completed in a single session. 

Once completed, you’ll receive your EIN right away. Download and print the confirmation document with your EIN and keep it with other important business documents. 

7. File a biennial report as needed 

All Iowa LLCs must file a biennial report during odd-numbered years, such as 2023. Submitting this report via Iowa’s fast track filing system is the most affordable option at $30 (compared to $45 for in-person or mail filing).

To submit your biennial report, log into your fast track filing account and select “business filings” from the top of the page, then “file a document” from the resulting drop-down menu. Select the “biennial report” link under “existing entities.” On the next screen, use the search bar to search for your LLC by name. You will be asked for the following information: 

• Your name, address and email address. 
• Your LLC’s street address. 
• If your LLC has an interest in Iowa agricultural land or if it is a family farm. 
• Your signature. 
• Your credit or debit card information (to process your filing fee).

Follow the instructions to pay for and submit your report. Wait for a confirmation saying “your filings have been successfully submitted” before clicking off the screen. 

You will receive an email notification once your filing is complete. At that point, you can access your submission via your fast track filing account dashboard. 

8. Apply for business permits and licenses as needed

Many businesses require permits to do business in Iowa. Whether you need one or not is determined by your business type. If you hire employees or sell goods, you must also register with the Iowa department of revenue. 

Business permits

Examples of businesses that require a permit to do business in Iowa include those in the automobile rental, hotel and motel, construction equipment and hazardous materials industries. To find out if you need to apply for a business permit, visit Iowa’s department of revenue business permit registration page.  

Tax permit

If you hire employees or sell goods, you must also apply for a business tax permit with the Iowa department of revenue. You can do so via your fast track filing account or by downloading the Iowa business tax permit registration form. As you fill out this form, you can also file for other business permits, such as hotel and motel permits, using the form’s included options. Permit fees range from $25 to $125 each. 

Information requested on this form includes:

• Your entity type.
• Your name, Social Security number, phone number and address.
• Your LLC’s legal name, fictitious name (if any), street address and mailing address. 
• The contact information of authorized individuals within your LLC who can speak to the department about business matters. 
• The types of business permits you need (based on your industry or goods sold). 
• Whether you have employees. 
• Your signature. 
• A check for permit filing fees made out to the Iowa department of revenue.

Mail your form and check to the address listed at the bottom of the form.  

Costs to start an LLC in Iowa 

There are some potential costs associated with setting up an LLC in Iowa, including the following fees:

• Certificate of organization filing fee: $50 
• Name reservation fee: $10 
• Fast track filing system biennial-report filing fee: $30 
• Expedited two-day business filing service: $50
• Registered agent service fee: $0 – $300 per year
• Business permit fees: $25 – $125 per permit 

Find the best LLC services for Iowa: Best LLC services

Frequently asked questions (FAQs)

Can I set up an LLC for free in Iowa?

No, you can’t set up an LLC for free in Iowa. To set up an LLC in Iowa, expect to pay $50 to file your certificate of organization. There are LLC formation services offering free formation services, but you’re still responsible for state fees. Such providers include Bizee and ZenBusiness. You may also have to reserve your business name for $10, hire a registered agent for up to $300 per year and apply for business permits for $25 to $125 per permit. Following your LLC formation, you will also need to file biennial reports on odd-numbered years for $30 per year.

Do Iowa LLCs pay taxes?

Iowa LLCs typically don’t pay taxes, but the members or owners of the LLCs do. Limited liability companies are “pass-through” entities, meaning the tax obligations pass through the business and are the responsibility of the owner or members (depending on their percentage of ownership). However, if you decide to tax your LLC as a corporation, your business may have a separate return. You may also have to pay taxes if you hire employees or sell goods. Consult a tax professional for guidance on which taxes you must pay.

Do I need a registered agent in Iowa?

Yes, it’s required to have a registered agent when setting up an LLC in Iowa. While you may appoint someone within your LLC to act in this capacity, many registered agent providers provide full-featured services, including document-handling discretion, document alerts, compliance management assistance and even legal consultations around your business document requirements.

Do Iowa LLCs need to file an annual report?

Iowa LLCs aren’t required to submit an annual report but rather a biennial reports that are submitted every two years. For LLCs in Iowa, this report is due during odd years and costs $30 to file through Iowa’s fast track filing system.

How do I dissolve an LLC in Iowa?

To dissolve your Iowa LLC, submit a statement of dissolution to the secretary of state and pay a $5 filing fee. You may also use your online fast track filing system account by logging in, then clicking “business filings,” “file a document” and “entity dissolution.” Use the search bar to find your business. Once you select your LLC, you will be directed to the dissolution form to fill out. Follow the prompts to complete and submit your paperwork.