How to Form an LLC in Guam
A Guam LLC (limited liability company) is a business structure that provides significant personal liability protection, flexible management options, and pass-through taxation (by default). To form an LLC on the island of Guam, you will need to file Articles of Organization with the Department of Revenue and Taxation and pay a steep $1,000 registration fee. Before you do that, you’ll need to choose a name for your LLC and designate a registered agent. We’ll walk you through entire process of forming an LLC in Guam and getting it ready to do business.
Ready to Start an LLC in Guam?Learn More
Name Your LLC
Designate a Registered Agent
Submit LLC Articles of Organization
Write an LLC Operating Agreement
Get an EIN
Open a Bank Account
Fund the LLC
File reports + taxes
1. Name Your LLC
Before you settle on a name for your business, you must make sure you adhere to the name requirements in Guam Code Title 18, Ch 15 § 15106. Your LLC name needs to:
- Contain “limited liability company,” “limited company,” or the abbreviation “L.C.,” or “L.L.C.”
- Be unique among registered businesses in Guam.
There isn’t an online business search tool for Guam businesses, so to find out if your preferred business name is available, you will need to call the General Licensing and Registration Branch of the Department of Revenue and Taxation. Keep in mind that there is a significant time difference between the US and Guam—Guam is 18 hours ahead of the US Pacific Time Zone. If this sounds like too much of a hassle, you can pay $25 to reserve your business name ahead of time. If your application is accepted, you’ll know your business name is available.
To get in touch with Guam’s General Licensing and Registration Branch, you can call 671-635-7321.
Can I reserve a business name in Guam?
Yes. If you want to reserve your business name while preparing to form your LLC, you can file an Application for Reservation of Name with the Department of Revenue and Taxation. The filing fee is $25.
Reserving your business name is another way to check that it’s available. If your name reservation is approved, you’ll know that no other business in Guam is using your desired business name when you file Articles of Organization.
What’s the difference between my LLC’s name and an assumed business name?
Your LLC’s legal name is the one written on your Articles of Organization. An assumed business name (also called a fictitious business name or a DBA) is any other name under which your LLC does business. Some businesses use an assumed business name when re-branding or branching out into a new industry. Doing so allows a business to operate under a new name without forming a new LLC.
To use an assumed business name in Guam, you must submit a Certificate of Transacting Business Under a Fictitious Name to the Department of Revenue and Taxation and pay a $25 filing fee.
Considering using an assumed business name? Learn How to Get a DBA.
2. Designate a Registered Agent
Next, you must appoint a registered agent for your business. The purpose of a registered agent is to accept legal notices, including potential lawsuits, on behalf of a business. You can be your own registered agent, appoint another individual, or hire a registered agent service for this role.
Learn why the pros use a registered agent service.
What does a registered agent do?
Registered agents can offer a range of services, but at the minimum, a registered agent must:
- Maintain a physical address (not a P.O. box or virtual office) within the territory of Guam.
- Be present at this address during normal business hours.
- Accept service of process and other legal notices on behalf of a business and forward them to the business without delay.
Can you be your own registered agent in Guam?
Yes. If you don’t mind having your name and address listed on the public record, and you can keep regular business hours to accept service of process in person, you can be your own registered agent in Guam.
Can I change my registered agent after I start an LLC?
Yes. If you want to change your registered agent, you will need to file an original and two exact copies of a statement of your change of registered agent with the Guam Department of Revenue and Taxation. There is no official form for changing your Guam registered agent, so you will have to write your own. The statement should include your business entity name, the name and address of your current registered agent, and the name and address of your new registered agent.
3. Submit LLC Articles of Organization
To officially form your LLC in Guam, you will need to file Articles of Organization with the Department of Revenue and Taxation and pay the $1,000 registration fee. You can file your Articles of Organization by mail or in person.
Note: All of the information on this form will become part of the public record.
Guam provides no form for Articles of Organization, so you’ll need to draft your own. It should include the following information about your LLC:
- Company name. Must include “limited liability company,” “limited company,” “L.L.C.” or “L.C.”
- Duration (optional). If you want your LLC to automatically dissolve after a certain number of years, you can list that here.
- Business purpose. For example, “to sell handcrafted, quality leather boots.”
- Registered agent. The person or business entity that will accept service of process on behalf of your business.
- Registered office. The office where your registered agent will maintain regular business hours. Must be an actual street address in Guam.
- Principal office. Must be a physical street address.
- Member or manager information. The names and addresses of your members or managers, depending on the management structure of your LLC.
- Members’ rights. Whether your LLC will be able to admit new members, and whether your LLC will be allowed to continue if one of your members dies, retires, or leaves the business for another reason.
- Assets. The total amount of cash and property (including description and value) your members have contributed to the LLC.
- Additional contributions. How much additional money or property (if any) your members will contribute to the LLC in the future, along with the date when the contribution will be made.
- Additional provisions (optional). Any other information you want to provide, such as contact information.
- Organizer. The person who completes your Articles of Organization signs here.
Ready to start your Guam LLC Articles of Organization? Check out our free Guam LLC Articles of Organization template.
How can I keep my personal information off the public record?
Some business documents, including Articles of Organization, go on the public record, where anyone could find them online and use them to sell your information.
The best way to keep your information private is to hire a registered agent service that can put its business address on public documents instead of yours wherever possible.
What’s the difference between a member-managed and manager-managed LLC?
In a member-managed LLC, all LLC members (owners) are involved in managing the daily operations of the business. In a manager-managed LLC, the members hire managers to oversee business operations for them. The people who manage your LLC will have the power to sign contracts, open business bank accounts, and hire and fire employees, among other things.
For help with deciding which management structure will work for you, see our page on LLC Member Vs Manager.
How do I file the Guam Articles of Organization?
You can file your Articles of Organization by mail or in person.
Department of Revenue and Taxation
Government of Guam
P.O. Box 23607
GMF, Guam 96921
Department of Revenue and Taxation
Government of Guam
1240 Route 16
Barrigada Heights, Guam 96913
4. Write an LLC Operating Agreement
Your operating agreement provides a legal blueprint for your LLC, specifying in detail how your business is structured and what rules it follows. Everything from how much each member invested to how you’ll handle internal disputes should be covered in your operating agreement. Its an internal document, so you won’t need to file it with the Department of Revenue and Taxation.
Check out our attorney-drafted Guam LLC Operating Agreement.
Does Guam require an LLC to have an operating agreement?
Guam’s legal code has various laws specifying the powers an operating agreement can have, but it does not require LLCs to adopt one. Even so, most banks require an operating agreement to open a bank account. And in a court case, your operating agreement helps you demonstrate that your business follows rules and procedures, which could be crucial to reinforcing your limited liability status.
What should be included in an operating agreement?
A strong operating agreement anticipates the “big-picture” situations that the LLC is likely to face at some point—everything from distributing profits and losses to voting power to dissolving the business. Most operating agreements cover at least these topics:
- initial investments
- profits, losses, and distributions
- voting rights, decision-making powers, and management
- transfer of membership interest
The Guam Code puts some restrictions on operating agreements, but for the most part, you can include anything in your operating agreement that doesn’t contradict your Articles of Organization or the law.
Does a single-member LLC need an operating agreement?
Yes. Even though a single-member LLC won’t need to worry about members disagreeing, banks will still want to see an operating agreement before you can open a business bank account. Plus, if your single-member LLC is ever sued, a strong operating agreement could be a powerful weapon in your favor.
5. Get an EIN
Next, your business needs an Employer Identification Number (EIN). An EIN is
a tax identification number assigned to a business by the IRS. It’s like your business’s social security number. You can get an EIN for free directly from the IRS. The fastest way is to apply online, but you’ll need to apply by mail if you don’t have a social security number.
Do I need an EIN for my Guam LLC?
Yes. Technically, you’re only required to obtain an EIN if your LLC is taxed as a corporation or has employees. However, an EIN is almost always required to open a business bank account. Plus, with an EIN, you won’t need to give your own social security number to business associates.
What To Do After Forming Your Guam LLC
6. Open a Bank Account
Now that you have an EIN, you’re ready to open a business bank account. This is an essential step because you must keep your business finances separate from personal finances in order to maintain your LLC’s limited liability status.
Here’s what you should take to the bank with you when you open your business bank account:
- Guam LLC Articles of Organization (a copy is fine)
- the LLC’s operating agreement
- the LLC’s EIN
- an LLC Resolution to Open a Bank Account (if your LLC has more than one member).
If your LLC has more than one member, use our free LLC Resolution to Open a Bank Account.
7. Fund the LLC
The next step is to fund your LLC. Each member should make an initial contribution to purchase their membership interest. In most cases, members will each write a check to the LLC bank account. However, you could allow members to contribute property or services to the LLC instead. Just be aware that contributions of property or services are likely to trigger a tax event.
What is LLC membership interest?
Your membership interest is the percentage of the LLC that you own. For most LLCs, membership interest is directly proportional to the member’s contribution. For example, if one member contributes $6,000 to an LLC, and the four other members each contribute $1,000, the first member would have 60% membership interest, and the other four members would have each have 10% membership interest.
Membership interest typically correlates to voting power. So in this example, the member with 60% membership interest would also have decision-making power in the LLC.
8. File State Reports & Taxes
Before doing business in Guam, you must obtain a Guam business license, which needs to be renewed each year. You can apply for a business license by submitting a Business License Application to the License Division of the Department of Revenue and Taxation or to the One Stop Licensing Center. The annual business license fee depends on the annual gross income of your business and ranges between $100 and $1,000.
All LLCs in Guam are required to file an annual report, called the Sworn Annual Report. The purpose of this report is to update the Department of Revenue and Taxation on your business’s contact and ownership information. There is a $100 filing fee.
Learn more about how to file the Guam Sworn Annual Report.
What is the due date for renewing my Guam business license?
Guam business licenses need to be renewed by June 30th each year.
When is the Guam Sworn Annual Report due?
The Sworn Annual Report is due by September 1st each year.
How are Guam LLCs taxed?
Guam LLCs are subject to a Business Privilege tax, which is currently 4% of the business’s gross proceeds of sales. To pay this tax, LLCs must file a Gross Receipts tax return every month. These tax returns must be filed on the Guam Department of Revenue and Taxation website.
By default, Guam LLCs are subject to pass-through taxation, meaning that the LLC’s revenue “passes through” the business to the owners. The owners then report the revenue as income on their individual tax returns. LLC revenue is taxed at the federal self-employment tax rate (15.3%). Guam LLCs can also elect to be taxed as an S-Corp or a C-Corp.
Learn more about S-Corp Vs LLC tax designation.