How to Start an LLC in Arkansas

Whether you’re a new or seasoned business owner, it’s important to get your new venture started on the right foot. You’ve probably already decided that a limited liability company (LLC)  is the best legal structure for your company, but you might not yet be aware of the various regulations and required steps for forming your business in Arkansas. 

Learn how to start an LLC in Arkansas and get all the tips you need in one place, from where to file certain forms online to understanding which business licenses you might need.

How to form an Arkansas LLC in 7 steps

Get your Arkansas LLC up and running by following these guidelines.

1. Choose your business name

Conduct an Arkansas LLC search to confirm that your desired name isn’t already taken by another business in the state. Then, ensure that the name complies with the following Arkansas naming guidelines: 

• It must include the words “limited liability company,” “limited company,” or “limited” or the abbreviations “LLC” (with or without periods), “LC” (with or without periods), or “Ltd.”
• The business name must be distinguishable from an existing business name in the Arkansas Secretary of State’s records. This is where an Arkansas business entity search comes into play, which can help you determine which names are available.
• Certain words require additional approvals, such as “bank,” “trust,” “engineer,” “engineering,” and “Razorbacks.” Additionally, medical and insurance businesses must obtain certification and comply with state statutes regarding these industries.
• Words that imply association with a government agency—like “State Department,” “Treasury,” “CIA,” or “FBI”—may be restricted.

Once you have determined that your desired business name fulfills these requirements, you can either begin your LLC formation process or reserve the business name for up to 120 days. To reserve a business name, fill out the online application for the reservation of an LLC name (Form LLC-05) or mail the form to the Secretary of State’s office. 

2. Appoint a registered agent

All LLCs in the state must have a registered agent. Their job is to ensure someone is always available to formally receive official correspondence on behalf of your business.

Arkansas law requires that a registered agent has a physical place of business in the state with a street address (not a P.O. box). Businesses can select a commercial or noncommercial registered agent. Commercial registered agents are individuals or entities serving many clients and acting in accordance with the Model Registered Agents Act of 2007; they must have a listing statement on file with the Arkansas Secretary of State. Noncommercial registered agents do not need to file a listing statement; these are typically individuals or entities that serve fewer clients.

While you can be your own registered agent, it’s a good idea to outsource this role to another person or business to protect your personal privacy and take this task off of your plate.

3. File your certificate of organization

When you have your business name and Arkansas registered agent service, it’s time to file your certificate of organization. Also called articles of organization in some states, this certificate provides basic information about your LLC and officially registers your business in Arkansas.

Visit the Arkansas Secretary of State’s website, where you’ll find Form LL-01 for the certificate of organization, which you can submit online or by mail. You’ll need to provide the following information for your Arkansas LLC registration:

• Company name
• The address for the LLC’s principal place of business
• The name and address of the LLC's registered agent
• The names and addresses of the LLC organizer and at least one member or manager
• Contact information where documents will be returned to
• Contact information where the annual franchise tax report will be mailed
• The effective date of the LLC, if a delayed effective date is preferred (cannot be more than 90 days from the filing date)
• The signature of the organizer

If the Arkansas Secretary of State approves the certificate, your LLC becomes a legal business entity. 

4. Create an operating agreement

Although operating agreements are not required by Arkansas state law, you shouldn’t form an LLC without one. An operating agreement is kind of like an internal business plan, including detailed information about how the LLC will be managed, taxed, and more. 

It typically outlines how internal disputes will be handled, for instance, profit distribution, financial decisions, or management succession. It also acts as another layer of protection from personal liability and offers clarity around the rules of operation, management, transferring of ownership, and dissolution process. For example, dissolving a business that doesn’t have an operating agreement in place means leaving the process up to state law.

An LLC operating agreement should include the following information:

• Basic business information, including the name, purpose, duration, and principal address
• Registered agent’s name and address
• Members’ names, addresses, titles, and contributions
• How profits will be distributed
• How the LLC will be managed, including members’ duties, daily operations, voting rights, or guidelines for meetings
• Tax structure
• Procedures for acquiring new members, transferring ownership, and dissolving the company
• Indemnification and liability clauses

5. Obtain an EIN and open a business bank account

An employer identification number (EIN) isn’t a requirement for all LLCs, but it is for those that are taxed as corporations, multi-member LLCs, and any business that plans on hiring employees. 

Regardless of these factors, getting an EIN is still a good practice for many LLCs because it helps to protect sensitive information. You can use your EIN on all legal and financial documentation instead of supplying your personal Social Security Number. EINs also help your business:

• Appear more credible
• Apply for business permits and licenses
• Manage state and federal taxes
• Open a business bank account

To apply for your nine-digit EIN issued by the Internal Revenue Service, visit the agency’s website, which has instructions for applying online, by fax, or by mail. Alternatively, you can also obtain an EIN with LegalZoom.

Opening a business bank account isn’t technically required to start your Arkansas LLC, but it does help keep your personal and business finances separate, sets up your business for growth, and makes it easier to keep track of your business’s expenses and income. You’ll find that many financial institutions ask for the following information in order to open a business bank account: 

• EIN
• Proof of identification—such as a passport or driver’s license—for account holders
• Formation documents, like a copy of your Arkansas certificate of organization or a business license
• Details about your LLC, including member information

6. Register for state taxes and business licenses

Next, register your business with the Arkansas Department of Finance and Administration through its online portal, Arkansas Taxpayer Access Point (ATAP), which is where you’ll file returns and pay state taxes. Registering on ATAP is a requirement for all LLCs that have employees and/or that sell taxable goods and services. LLCs with employees can also pay unemployment taxes through ATAP, but first they need to register for an employer account number with the Arkansas Division of Workforce Services.

You may also need to secure business licenses or permits with the state or local jurisdiction in which your business operates. Here’s what you might need for your Arkansas LLC: 

• Sales tax permit from the state Department of Finance and Administration, if your LLC sells taxable goods or services.
• General business license from the city and/or county where your LLC is registered or conducts business.
• Professional or occupational license from the relevant agency. You can find more information on the Arkansas Department of Labor and Licensing website.
• Zoning and building permits, depending on the type of business and its location.

Find the business license you need for your LLC with LegalZoom’s business license service, where we take your information and compile a report with links to every permit or license that applies to your business, along with helpful instructions. 

7. File the Beneficial Ownership Information Report (BOIR)

The final step in how to start an LLC in Arkansas is filing your Beneficial Ownership Information Report (BOIR) with the federal Financial Crimes Enforcement Network (FinCEN). This is a new requirement in the United States, with the goal of reducing illegal financial activities.

Businesses only need to file the BOIR once, unless company information changes. The deadlines for filing the report are: 

• Within 90 days of business formation for businesses registered in 2024
• Within 30 days of business formation for business registered on or after January 1, 2025

To determine whether your LLC is required to file a BOIR, take a look at this BOIR compliance and filing guide. If your LLC is not exempt from the requirements, submit an electronic filing through FinCEN’s BOI E-Filing portal by the deadline to avoid incurring legal or financial penalties.

What to do after forming your Arkansas LLC

Even though your business formation process is complete, there may be a few more things to do to ensure your LLC is compliant and set up for success. 

Register a domain name

Having a website for your business isn’t a requirement, but it does help with marketing your company and creating a great experience for your customers or clients. You might not have the bandwidth to set up a website now, but if you plan on getting one up and running in the future, it’s best to reserve a domain name now. 

You can search for and purchase domain names on sites like GoDaddy, Wix, or Squarespace. Make sure that the domain name matches your business name or uses a close variation.

Maintain compliance

It’s important to ensure that your LLC is compliant with ongoing state and local regulations, including state taxes and state or local licenses. 

For any registered LLC, Arkansas requires the submission of an annual franchise tax report. This requirement applies to all domestic and foreign corporations, banks, and insurance companies in Arkansas.

A franchise tax is essentially a tax levied on businesses for the privilege of doing business in the state. In Arkansas, all annual franchise tax reports are due by May 1; late filings will incur a penalty of $25. Find the online and PDF forms on the Secretary of State’s website.

In addition to paying the annual state franchise tax, your LLC will likely need to renew business licenses and permits yearly with the relevant state or local agency. Check with the applicable agency to determine which permits and licenses need to be renewed, when the deadlines are, and if there are associated costs—or, let LegalZoom help you stay in compliance.

Obtain a certificate of good standing

Verify your business’s legal standing and prove to clients and vendors that it is compliant with state law by getting a certificate of good standing. This certificate isn’t required in Arkansas, but it can help with securing loans, expanding to other states, and even obtaining or renewing business permits or licenses (some of which require a certificate of good standing).

Certificates of good standing are issued by the Arkansas Secretary of State. You can purchase and print yours through your business’s profile on the Secretary of State’s website.

Consider a foreign LLC

Planning on expanding your business to other states? To do so, you’ll have to register as a foreign LLC in those states. Because filing requirements and fees vary by state, it may be best to file for foreign qualification through LegalZoom, which creates and files the necessary paperwork with the applicable state agency so you don’t have to.

The cost of forming an LLC in Arkansas

Starting an LLC in Arkansas does involve some upfront costs. Estimate your total costs by using the following list:

• Name reservation application: $22.50 online, $25 by mail (one-time fee)
• Certificate of organization: $45 online, $50 by mail (one-time fee)
• Operating agreement: $0 to $199, depending on if you create one yourself or use legal services (one-time fee)
• Registered agent service: $100 to $300 (annual fee)
• EIN: $0 to $79, depending on if you use a service (one-time fee)
• Business bank account: $0 to $100 deposit is typically required to open an account 
• Domain name: $10 to $50 (annual fee)
• Business license or permit: Cost varies by type of business, industry, and local jurisdiction (annual fee)
• Annual franchise tax report: $150 (annual fee)
• Certificate of good standing: $25 (one-time fee)
• BIOR: $0
• Foreign LLC registration application: $270 online, $300 by mail (one-time fee)
• Total minimum cost: $352.50

How to start your Arkansas LLC with LegalZoom

Get your business up and running seamlessly and stress free with a little help from LegalZoom. With our business formation services, not only can you kickstart your LLC in minutes, but you can also reduce the amount of paperwork on your plate, leaving the heavy lifting to us. Get the guidance you need, submit the right documents at the right times, and ensure compliance for your company with LegalZoom.

FAQs

What are the benefits of filing an LLC in Arkansas? 

There are several benefits of filing a limited liability company, or LLC, in Arkansas, including personal liability protection, the choice of tax classification, and flexible business management and profit distributions. Additionally, LLCs typically involve less paperwork and fewer recordkeeping requirements than corporations.

What are the annual filing requirements for Arkansas?

The annual filing requirements for Arkansas LLCs include the franchise tax report due to the Secretary of State. If you have business permits and licenses, those may need to be renewed annually with the relevant agency.

How long does it take to form an LLC?

In Arkansas, it can take up to 10 days for the Secretary of State’s office to approve a certificate of organization, depending on if the form was submitted online or by mail. However, there are other factors that may affect how long it takes to form an LLC, like conducting a business name search, applying for a name reservation, hiring a registered agent, crafting an operating agreement, and more.

How do I correct filing errors in AR?

For Arkansas LLCs, filing errors on your certificate of organization can be corrected by submitting a certificate of amendment, Form LL-02, to the Secretary of State. This amendment costs $22.50 if filed online or $25 if sent by mail.

How do I dissolve an Arkansas LLC?

To dissolve an Arkansas LLC, first, reference your business’s operating agreement to understand what guidelines need to be followed. Then, submit a statement of dissolution, Form LL-04, to the Arkansas Secretary of State along with your final franchise tax report. The statement of dissolution costs $45 if submitted online or $50 by mail, and the final franchise tax report costs $150.

Rudri Bhatt Patel contributed to this article.