Start an LLC in Arkansas

Use our free business tools below to complete your Arkansas Certificate of Organization. This is the document you file directly with the Arkansas Secretary of State to form your LLC.

If you want more, hire us to form your LLC in Arkansas. We’ll get your business stood up in minutes with a free domain, website, email, business phone, and more.

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How to Start an LLC in Arkansas

To form your Arkansas LLC, submit a Certificate of Organization to the Arkansas Secretary of State and pay a $45 filing fee ($50 to file a paper form). It takes between 3 and 10 business days for Arkansas to approve an LLC’s formation. We’ll walk you through forming your own Arkansas LLC in this guide.

 

1. Name Your Arkansas LLC

You need to decide on your business name before registering your LLC. Your Arkansas LLC’s name should follow the naming requirements set by the state. You can make sure your preferred name is available by searching the Arkansas Secretary of State’s business registry.

Arkansas LLC naming requirements

Under AR Code § 4-38-112., your LLC name must:

  • Contain the words “limited liability company” or “limited company,” the abbreviations “L.L.C.,” or “L.C.,” or “Ltd. Co.”
  • Be distinguishable from the name of any other business in Arkansas.

The LLC name must not:

  • Contain words or abbreviations that imply a different business type, such as “corporation,” “limited partnership,” “inc.,” etc.
  • Use the name of a person who is not a member of the LLC, except for former members or members of a predecessor organization.

Reserving a business name in Arkansas

If you need to hold off on forming your LLC but want to make sure no one else claims your ideal name in the meantime, file an Application for Reservation of Entity Name with the Arkansas Secretary of State. Your name will be reserved for 120 days in exchange for a $25 fee ($22.50 if filed online).

Getting a DBA “Doing Business As” name

In addition to your LLC’s official name, you may have reason to use a DBA (which Arkansas calls a fictitious name). Fictitious names work like nicknames a business can legally use. Arkansas requires any LLC seeking a fictitious name to to submit an Application For Fictitious Name with the Secretary of State along with a $25 filing fee.

Reserving a domain name

When registering your LLC name, you may want to reserve a matching or complementary domain name at the same time. If not, you may discover that your business name has already been claimed when you’re finally ready to create a business website. When you start an LLC with Northwest, you can add a year of free domain registration.

Trademarking your Arkansas LLC name

Simply registering an LLC name in Arkansas doesn’t mean have you legal control over the name. When another business uses your name, you can’t do much to stop them without a trademark. You can trademark your business name inside Arkansas by filing a Trademark and Service Mark Application or protect your name across the country with a federal trademark.

2. Appoint an Arkansas Registered Agent

Arkansas requires LLCs to appoint a registered agent, an individual or entity responsible for receiving legal mail and service of process (in other words, lawsuits) on behalf of your business.

Arkansas registered agent requirements

Under state law, a Arkansas registered agent must:

  • Have a physical street address in the state. No P.O. boxes!
  • Receive important legal correspondence for your LLC and forward it to you promptly.

Additionally, a registered agent needs to be available at the listed address during normal business hours to accept service of process.

You can be your own Arkansas registered agent if you live in the state, but you’ll need to include your name and address on the Certificate of Organization, which becomes part of the public record.

Using a registered agent service

While anyone can be the registered agent for an Arkansas LLC, many successful businesses appoint a professional registered agent instead. Here’s why:

  1. Privacy. Your Certificate of Organization must have a physical address where the state can deliver service of process. This address becomes part of the public record and easily accessible online. If you hire Northwest, you can use our address instead of your own wherever possible, including on your LLC’s Certificate of Organization.
  2. Peace of mind. A fast response is critical when time-sensitive state or legal notices get sent to your business. Failure to respond within a deadline can mean fines or other penalties. When you hire Northwest as your registered agent, you get instant notifications and same-day scans of all legal mail, giving you plenty of warning for those crucial deadlines.
  3. Protecting your image. With any luck your LLC will never experience a lawsuit. But if your luck runs out, having a registered agent discreetly handling your legal notices lets you avoid the embarrassment of getting served in the middle of normal business operations.

3. Get an EIN

Most states allow you to form your LLC before getting an Employer Identification Number (EIN) from the IRS, but Arkansas requires you to provide one when you file your Certificate of Organization, so you’ll need it ahead of time.

Your LLC’s EIN is similar to a social security number for businesses. The IRS uses the number to identify your business on tax forms. If you have a social security number, you can get a free EIN instantly from the IRS by applying online. If you don’t have an SSN, you’ll have to submit a mail or fax form that takes longer to process or call the IRS. Alternatively, you can hire us to get your EIN for you.

4. Submit Arkansas LLC Certificate of Organization

Now you should be ready to submit your Arkansas LLC Certificate of Organization to the Secretary of State. You can file online for $45, or by mail or in person for a $50 fee. Certificates filed online take between 3 and 7 business days to process, while mailed forms take 7 to 10 business days.

Here’s the information you’ll need to file your Certificate of Organization:

  • LLC Name: Include “Limited Liability Company,” “Limited Company,” or an acceptable abbreviation.
  • Principal Office Address: This must be a physical street address.
  • Registered agent: The name of the person or company authorized to accept legal mail on your LLC’s behalf.
  • Registered agent address: The physical street address of the office where your registered agent can be reached.
  • Name and title of at least one officer: This is for franchise tax purposes.
  • Franchise tax contact information: List a name, address, and phone number of someone you want to receive the franchise tax reporting form every year. You’ll also need to list your company’s EIN.

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5. Create an LLC Operating Agreement

The operating agreement is your LLC’s guiding document, a contract between its members that sets company rules and structure. Arkansas does not require LLCs to adopt a written operating agreement, but it’s standard business practice and can help you avoid legal disputes and misunderstandings.

Your LLC’s operating agreement can include whatever rules best serve your LLC’s needs. All operating agreements should cover:

  • Initial investments
  • Profits, losses, and distributions
  • Voting rights, decision-making powers, and management
  • Membership interest
  • Dissolving the business

It’s recommended you consult a lawyer before approving your operating agreement. We provide free, attorney-drafted Arkansas operating agreement templates you can use to get started.

6. File the Beneficial Ownership Information Report

Most new LLCs need to file a Beneficial Ownership Information (BOI) Report within 90 days of forming. This report is a new federal requirement aimed at fighting scams and money laundering. It discloses identifying information about your company applicant and all beneficial owners to the Financial Crimes Enforcement Network (FinCEN). The BOI Report is not a public record but can be used by law enforcement and certain federal agencies, as well as financial institutions with customer due diligence requirements.

You can file your LLC’s BOI Report for free through the FinCEN.gov website. Or, we can file your BOI Report for you for $9.

7. Next Steps

Once your LLC is registered in Arkansas, there are a few other things to do in order to keep your LLC in good standing with the state. Here are some additional tasks to prepare for:

Opening a bank account

LLCs have limited liability because they’re considered legally separate entities from their owners. Unfortunately, it’s easy to blur that legal separation and risk losing your LLC’s limited liability by mixing personal and business funds. This is why you need to get your Arkansas LLC a bank account to keep business funds and your personal finances apart, even as a single-member LLC.

To open a bank account for your Arkansas LLC, you’ll probably need to provide this documentation:

Note: Not all banks have the same requirements, so call ahead to find out which documents to bring.

Licenses and permits

Depending on what your business does and where it operates, you may need one or more business licenses or permits, possibly including:

  • Professional licensing (For regulated industries such as medicine, law, construction, etc.)
  • Home business permits
  • Fire Department permits
  • Health Department permits
  • Zoning permits

Check with your city and county government to see if a general business license is also required.

Arkansas tax requirements

Arkansas LLCs are treated as pass-through entities by default, so they don’t pay state or federal income tax but instead pass those profits on to their members who declare them on their own tax returns. Those members are subject to a graduated income tax that starts at a 2% rate for taxable income between $5,000 and $9,999 and tops out at 4.9% for taxable income between $23,600 and $84,500.

Arkansas also has a corporate tax rate from 1% on income under $3,000, up to 5.3% for taxable income over over $25,000. Only LLCs that choose C-Corp tax status pay corporate income tax.

Though corporate income tax may not apply, your LLC probably still needs to register with the Arkansas Department of Finance and Administration for a 6.5% sales and use tax on any business selling taxable goods or services, plus taxes and fees for specific goods and services (like liquor excise taxes, parks and tourism tax, and aviation sales and use taxes).

LLCs with employees pay Unemployment Insurance Tax, starting at a 2.9% rate on the first $10,000 paid to each employee. A new percentage is determined after your LLC operates for 3 years. And Arkansas also requires businesses with at least three employees purchase workers’ compensation insurance.

Arkansas Annual Franchise Tax Report

All Arkansas LLCs must file their Arkansas Annual Franchise Tax Report with the Secretary of State by the first of May. The report updates the state on who owns your LLC and how you can be contacted.

The franchise tax is a flat $150, and a $25 fee applies for late reports (with an additional 10% interest for each year you’re delinquent). Worried about forgetting to file it? Hire us to file your Annual Franchise Tax Report for you, and we’ll let you know 90 days before it’s due.

8. Arkansas LLC FAQs

How much does it cost to start an LLC in Arkansas?

The fee to file an Arkansas Certificate of Organization is $45 when filing online, and $50 with a paper form.

How are LLCs taxed in Arkansas?

LLCs are taxed as pass-through entities by default, which means that they don’t pay corporate income tax. Instead, the revenue of the LLC goes directly to the members, who each pay individual income tax on their part of the revenue on personal state and federal tax returns, subject to the federal 15.3% self-employment tax. You may also need to pay local taxes, depending on which Arkansas city or county your business operates from. Arkansas cities may also add additional sales tax on top of the state’s basic 6.5% sales and use tax rate.

How long does it take to form an LLC in Arkansas?

A Certificate of Organization filed online is processed by the state in 3 to 7 business days, and mailed forms take 7 to 10 business days.

What’s the difference between an LLC and PLLC in Arkansas?

Arkansas allows professional limited liability companies (PLLCs), a type of LLC specifically for licensed professions, such as medicine, law and engineering. These professions require certification by a state board governing their licensing. However, Arkansas does not specifically require licensed professions to form a PLLC. Professional services can be provided by any business type, even standard corporations and conventional LLCs, unless a specific licensing board expressly prohibits it.

Does Arkansas allow series LLCs?

Yes, Arkansas allows the formation of series LLCs. Arkansas Series LLCs must file a Certificate of Organization for a Series Limited Liability Company, as well as a Protected Series Designation for each series formed.

How do you transfer ownership of an LLC in Arkansas?

Your Arkansas LLC’s operating agreement should define procedures for how ownership can be transferred from one or more members. Usually, LLC ownership is transferred with a partial sale when a single member sells their interest in the LLC, or through a complete sale of the company.

*This is informational commentary, not advice. This information is intended strictly for informational purposes and does not constitute legal advice or a substitute for legal counsel. This information is not intended to create, nor does your receipt, viewing, or use of it constitute, an attorney-client relationship. More information is available in our Terms of Service.

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