How to Start an LLC in 2026 - Step by Step

Hey, my name is Dan and in this video, I'll show you everything you need to know to set up an LLC. In just 10 minutes, we'll walk through a step-by-step road map for starting your LLC so that each step is less stressful and you know exactly what to expect. If you've been putting this off out of fear or confusion, don't worry. It's actually pretty simple once you see the process in a logical order. By the end of this video, you'll have clear expectations of what's required from you, what your LLC formation might cost, and what mistakes you should avoid. [music] And believe it or not, you can do this entire process by yourself. But if by the end of this video, you still want help starting your LLC, I'll also show you a great option for that, too. So, let's get started. Step one is deciding which state to form your LLC in. For most people, this is a simple choice. You form your LLC in the state where you actually live and do business. That's the default and it's the most common option because states generally expect you to register where you're operating. The term for this is a domestic LLC. You may hear some people say things like just form in Wyoming or in Delaware. And for a small percentage of people, forming a business out of state can make sense, usually for privacy or very specific situations. But doing so can add extra work cost and complexity. This is called a foreign registration. So if you form your LLC in a different state than where you live and work, you may have an extra registration step and create extra recurring work for yourself. For example, if you form in Ohio, but you run the business from Pennsylvania, you may need to register your Ohio LLC in Pennsylvania as well, which adds cost and paperwork. The simple rule is this. If you're doing business in one state, start there. And even if you're only doing business online, you still register where you live and work. Only look out of state if you have a clear reason to do so. And if you're stuck on this, you may want some legal or tax advice before continuing. Step two is choosing your LLC name. Now that you've picked your state, you can now pick your name because your LLC name has to be unique in that state. Start on your state's Secretary of State website and look for a business name search. In Pennsylvania, for example, I'll Google PA Secretary of State business search. I'll try this.pa.gov link for record searches. And there's a business entity search link right at the top. If you scroll down, you'll find a free business search. And this is the type of tool you'll want to find for your state. Once you find it, check if your desired name or if something similar exists. If it's taken, keep brainstorming and search again. Most states require a designator at the end of your name, like LLC or limited liability company. The exact rules vary, so use whatever your state accepts. If you can't find the exact rules on this just yet, that's okay. On the filing paperwork, it will usually tell you the requirements, but we'll get to that soon. After checking that your potential name is unique, do a quick brand check. Look up possible domain names and social media handles. It's fine if the exact matches are taken. You can likely add a small variation of the handles while keeping branding consistent. Finally, do a quick trademark check. Search Google and search the United States Patent and Trademark Office database, too. That's called the US PTO. I'll link that down below. You don't need a trademark to form an LLC, but if you're building a real brand, it's worth double checking before you lock in the name. Step three is choosing a registered agent. A registered agent is a person or company that receives official mail for your LLC, like expected mail, legal notices, and government letters. If your business ever gets sued, you hopefully it won't. This is where the state knows where to send the paperwork. Most states require your registered agent to have a physical street address in the state where your LLC is formed, and they need to be available during normal business hours. Now, you can be your own registered agent, and some people do that. The trade-off is between privacy and convenience. Your name and your address may become public as your own registered agent, and you have to be available during the day to receive documents. You could also use a registered agent service to handle all of this for you. You can use their physical address, and it can keep things more organized. I'll link our registered agent service in the video description below. If you do use a registered agent service, that can also be very helpful for step four, filing formation paperwork with your state. This is the part that officially creates your LLC. And in most states, you do this through your Secretary of State website. The form is usually called articles of organization or something similar. To file, you'll enter your basic info like your LLC name, your business address, and your registered agent. You will also choose a management type, which is just who runs your LLC. Member managed means the owners run it dayto-day. Manager managed means you name one person or a small group to run it for you. If it's just you or you and a partner actively running the business, member managed is usually the right choice. Most states let you file online, but some still allow mail filing as well. Then you pay the state filing fee. It varies a lot, but most states fall between $50 and a few hundred. Some states also offer expedited processing for an extra fee. Processing time can be anywhere from a few days to a few weeks depending on your state. And in a small number of states, there's an extra public notice step. For example, in New York, you may need to publish a short notice in local newspapers announcing your LLC formation. One last thing to be aware of is the organizer. The organizer is simply the person who submits the filing. And in some states, that name becomes public record. Step five is creating an operating agreement. An operating agreement is basically the rule book for your LLC. It says who owns what, who makes the decisions, and how money gets split. Even if you're a single member LLC, it's still worth having. It helps you treat the business like a real separate entity and banks may ask for it. If you have multiple members, this part matters a lot more. You want to spell out the roles, the voting, the profit splits, and you want to do this while everyone is still on good terms. You also want simple whatif rules like what happens if someone wants to leave, if you get stuck in a tie, if someone stops doing the work, or if someone's unable to work. If you're forming a multimember LLC, it's also worth having an attorney review your operating agreement before you move on. Step six is getting your employer identification number or EIN. An EIN is basically a social security number for your business. You will use it to open a business bank account, handle taxes, and hire employees later if you ever need to. You can apply for an EIN for free on the IRS website, and it only takes a few minutes. After you get it, save the EIN confirmation letter and back it up somewhere safe. banks and other services may ask for it later. If you use a registered agent service when creating your LLC, they may offer to get the EIN for you. Step seven is choosing your tax setup. The simple way to think about this is that the LLC is the legal structure and taxes are a separate choice. By default, a singleowner LLC is usually taxed like a sole proprietor and a multi-owner LLC is usually taxed like a partnership. This is normal and that's how many LLC's start and that's how I've personally done it in the past. Later on, some businesses choose to be taxed as an escorp to potentially lower certain taxes, but this is not something you need to decide on day one for most beginners. If you're unsure, this is a good point to talk to a CPA because the right setup depends on your income, your situation, and your plans. Step eight is opening a business bank account. The goal here is simple. Keep your business money separate from your personal money. If you mix them together, it can create legal and tax headaches. So, open a business checking account, deposit income in there, and then pay business expenses from that account. To make tracking easier, use a business debit or credit card for business purchases, and save all the receipts as you go. Then, set up a basic bookkeeping routine, even if it's just a spreadsheet or a simple accounting app. Pick a few categories and review that once a month. And if you want to start building business credit later, this clean separation is the foundation. You'll find a link to the business bank account we recommend in the description below. Step nine is keeping your LLC in good standing. Forming the LLC is the beginning, but you also have to maintain it. Most states require some kind of annual report or renewal, plus a fee, so make sure you know your due dates. Also, keep your registered agent and address information up to date. On the tax side, file what you're supposed to file when you're supposed to file it, and keep clean records for income, expenses, and contracts. And depending on what you sell and where you operate, you may also need local licenses or tax registrations. So do a quick check for your state and city requirements. Now, if you want to save time and avoid any mistakes, I highly recommend using a registered agent service to help set up your LLC, especially if you've never done this before, a good registered agent service guides you through the entire formation process. It helps you fill out the paperwork correctly and make sure you don't miss any state specific requirements. They also keep your personal address private in public records, handle all your legal mail digitally, and often include extras like operating agreement templates, EIN filing assistance, and annual report reminders. Basically, they take the guesswork out of the process and give you the peace of mind that everything is done right. I've put a link to our recommended registered agent service in the description below. And I've also created a separate video that's a complete walkthrough of how to set up your LLC using that service step by step. You can see that video on the screen right now and it's linked in the description as well. Whether you do it yourself or you use the service, the most important thing is that you actually get started. Thanks for watching and I'll see you in the next