LLC in PA: If you want to form a Pennsylvania LLC online or by mail, you need to submit the Articles of Organization with the Pennsylvania Secretary of State for $125. For details, follow the 7 steps given in this article.
An LLC in Pennsylvania basically links an organization’s limited liability with the pliability and shortage of formalities. All these are offered by any sole proprietorship or association.
We would recommend setting up an LLC in PA for any entrepreneur whose objective is to restrict liability for professional lawsuits and debts.
Not from Pennsylvania? Learn to Start an LLC in any other State.
Tip of the Day: Pennsylvania LLC formation by yourself is mostly hectic and time taking. Hiring a reliable LLC formation service is not only a good choice, but saves you from overspending. Therefore we recommend you to:
Now, what is an LLC? A Limited Liability Company (LLC) unites the best of partnerships, sole ownerships, and corporations into one organizational entity providing full protection to liabilities, tax incentives or flexible business structures, etc.
It only costs almost 125 USD to initiate an LLC in Pennsylvania.
All you’ve to do is to submit a certificate of your new business with the State Minister. An entrepreneur can either apply online, drop a mail, or visit the office in person to build a new LLC.
In this article, we will explain the LLC formation method in Pennsylvania. So let’s get started!
Outlining the LLC Formation Process
- Pick a Name for Your Pennsylvania LLC
- Find a Registered Agent for Your LLC
- Submit the Articles of Organization
- Establish an LLC Operating Agreement
- Follow the Tax and Other Administrative Requirements
- Fulfill Your State Tax Commitments
- Submit Annual Reports
Next, we are going to discuss the steps one by one to make to clear for all of the viewers and new entrepreneurs.
#1: Pick an LLC Name
The first and foremost part of building an LLC in PA is to pick up the right company name. Try to select a name that corresponds to Pennsylvania standards and is conveniently accessed by prospective customers.
What Instructions Should Be Followed While Naming an LLC?
- Every business owner should include “Limited Liability Company” to his new company or the abbreviation of it, LLC.
- Avoid using words that can mystify your LLC name with the government agencies, such as State Organizations, Treasury, FBI, etc.
- Make sure to choose a unique name from other corporations, Pennsylvania LLCs, or limited liability parties.
- If you want to fit in a few confined words like an attorney, bank, university, etc., it might demand hiring a licensed lawyer or doctor for additional documentation.
The next step is to verify access to your chosen name in Pennsylvania. Make sure if the name is still available or utilized by another entity.
You can visit Pennsylvania’s official state website to check on Business Registry Search. Furthermore, one can also generate a name through an LLC Name Generator online.
#2: Find a Registered Agent
Another vital step is to find a reliable Registered Agent to form an LLC in PA.
There are some limitations when choosing a registered agent in Pennsylvania. The person should be a Pennsylvania inhabitant who would be able to perform your business tasks from within the state.
You may also nominate yourself for the official documentation, but we personally recommend going for ZenBusiness. Besides offering a free first year of their registered agent services, the company will form your Pennsylvania LLC only for $39 plus the state filing fees.
#3 File an Articles of Organization
During the formation of an LLC in PA, it’s crucial to submit your articles of organization linked with the Secretary of State. A general article should cover the following:
- Name and web address of your LLC’s planner
- The official name and address of Pennsylvania LLC
- Details of your LLCs registered entity
- Details of your company members
- The official LLC emails
- Entrepreneur’s signature
DIY Cost of Forming an LLC in Pennsylvania ($125)
The main LLC formation cost through the DIY route is the state filing fee of your Article of Organization. Currently, the state of Pennsylvania charges you $125 for filing your LLC and it may be subjected to revision by the state. The filing fee for articles of organization is the same, regardless you submit them online or through the mail.
#4: Establish an LLC Operating Agreement
An LLC operating agreement is constitutional paperwork that sketches the rules and regulations for a new company and also outlines the entrepreneur’s operating procedures to form a new LLC in PA.
Although not necessary, creating an operating agreement will benefit a company for sure.
This legal agreement guarantees all entrepreneurs to remain on the same boat, which ultimately lessens further business clashes.
#5: Follow the Similar Tax and Other Administrative Requirements
A few extra taxes and other administrative requirements might implement in your new LLC that includes:
Employer Identification Number (EIN) – It is just like a Social Security Number, so if your company has more than one employee, you can get this EIN by paying extra. This nine-digit code will check into your tax issues and assist you in creating a new bank account, hiring new staff, etc. One can submit an online form at the IRS website to get an EIN for his company.
Official Licenses – Sometimes, your new LLC in Pennsylvania might demand official state licenses or other approvals, depending on the business type and its location. So, there are Economic Resource Units in Pennsylvania leading you to authorities to guarantee proper licensing, registration, or permissions within the state.
#6: Fulfill Your State Tax Commitments
After getting a Pennsylvania LLC, there are several responsibilities of a business entity that should be fulfilled. For instance, in a few cases, one has to check with the Pennsylvania Department of Revenue (PADOR) for selling products or assembling sales tax, etc.
For your convenience, PADOR has an online platform, so you can register yourself from there through Business Taxes Registration Application. For more information, you can review detailed LLC articles on our website.
#7: Responsibly Submit Annual Reports
Many websites have misleading information regarding the LLC annual fillings in Pennsylvania. You may find this typical statement “All LLCs in Pennsylvania need to file a Decennial Report every 10 years.” Well, this is not completely true.
Your LLC may or may not need to file a Decennial Report depending upon the amended filings made within that 10-year period. So there will be two scenarios:
- If your LLC hasn’t filed any amendment in the last decade, your LLC must file a Decennial Report within the 10th calendar year with $70 fee.
- If your LLC has filed some amendment in the last 10 years (including the LLC formation itself), your LLC doesn’t need to file Decennial Report within the 10th calendar year.
Moreover, domestic limited liability companies, professional limited liability companies, and foreign limited liability companies in Pennsylvania are treated differently in terms of annual filings. For more details on how to file this report or state-specific fee, read our article on LLC annual (or biennial) report.
Professional limited liability companies (PLLCs) and foreign LLCs engaged in professional services in Pennsylvania needs to file a Certificate of Annual Registration due by April 15 each year and should be submitted directly to the Pennsylvania Corporation Bureau. The filing fee is $520 multiplied by the total number of members in the LLC.
Late Filings: In case you are unable to submit the required decennial report, it will cause your LLC to lose good standing status with the state. Moreover, your LLC’s name will become available for use by any other entity in Pennsylvania. Further failure to file a decennial report may result in the dissolution of your LLC.
Additional Information on LLC in Pennsylvania
I. Register a Foreign LLC in Pennsylvania
Entrepreneurs often form an LLC in a state other than the state of their residence to have some tax benefits and reduce LLC formation costs. Moreover, some business owners have their LLC franchises in multiple states. In such cases, they register their LLCs or franchises as foreign LLCs in all states where they operate their business.
If you have an LLC in any other state and wish to open a franchise in Pennsylvania or want to form an LLC in Pennsylvania while you are a non-Pennsylvania resident, you can form a foreign LLC by downloading a foreign LLC application and mailing it to:
Pennsylvania Department of State,
Bureau of Corporations and Charitable Organizations,
P.O. Box 8722,
Harrisburg, PA 17105.
You also need to submit a Pennsylvania LLC Docketing statement along with your Foreign LLC application.
Pennsylvania Foreign LLC Filing Fee: ($250 – nonrefundable)
II. Hiring Employees in Pennsylvania
To run your business in a compliant manner, you have to follow the State of Pennsylvania Department of Labor & Industry’s guidelines while hiring employees for your existing business or new LLC. Some of the major points are stated below;
- Verify the employment status of individuals, such as whether the potential employee is a US resident; if not then are they permitted to work in the US, are they of a certain age to work for that particular job, etc
- Report new hiring to the state
- File quarterly reports on wages and taxes
- Report job refusal
III. Acquire Relevant Business Licenses and Permits to Operate in Pennsylvania
To successfully operate your LLC in Pennsylvania, you must acquire permits and license to comply with federal, state, and local government regulations. For instance, to operate a pest control business, you need to acquire a license from the department of agriculture and fulfill the state’s certification requirements, etc
The requirements and fees for business licenses and permits vary from state to state. Work thoroughly on prerequisites and compliance-related information for your business before officially filing your LLC with the state. However, the following resources may help;
- Hire a reliable, professional service like ZenBusiness to do a license and permit search for you. Many LLC formation services do this as a part of their LLC formation packages.
- Visit the US Small Business Administration (SBA) guide for federal license and permit information.
- The government of Pennsylvania website’s State License Search section helps you learn the state’s license requirements.
- Visit your local county clerk’s office and seek information about local licenses and permits.
IV. Obtaining a Certificate of Good Standing in Pennsylvania ($40- nonrefundable)
A Certificate of Good Standing, aka Certificate of Compliance in Pennsylvania, verifies that your LLC has been legally formed and is being operated and maintained in a compliant fashion. This document is needed for;
- Filing your business as a foreign LLC
- Seeking funding and investments from banks or other people
- Acquiring or renewing relevant business licenses or permits
You can request the certificate of subsistence online from Pennsylvania’s Secretary of State’s official website.
V. Dissolving Your LLC in Pennsylvania
In case you no longer wish to continue your LLC in Pennsylvania at any point in the future, you must officially dissolve it; otherwise, you may face tax liabilities, penalties, and legal troubles.
Pennsylvania LLC Dissolution Fee: ($70 – nonrefundable)
In Pennsylvania, you can dissolve your LLC by following 3 basic steps:
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We hope this article has helped you in every aspect of forming an LLC in Pennsylvania. If you still have any questions or confusion, please ask in the comment section.
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