Pennsylvania LLC: How to Form an LLC in Pennsylvania

Pennsylvania LLC

Starting your new business in Pennsylvania? Want to make sure that your personal assets remain safe and secure? You should form an LLC in Pennsylvania. Not only will forming an LLC give you a high level of credibility with your potential clientele, but it will also ensure that your business is risk-free.

Want to learn how to form a Pennsylvania LLC quickly? We are here with a comprehensive guide. Whether you are thinking of forming an LLC for your new business or you are expanding your business from another state into Pennsylvania, this guide will be your friend!

Without further ado, let’s get started!

Quick Summary

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Busy setting your business up and can’t spare the time to go through the whole guide? Don’t worry for we have got you covered! Just read the quick highlights given below and you will be on your way to forming an LLC in Pennsylvania!

The necessary steps for creating an LLC in Pennsylvania are:

  1. Naming the LLC
  2. Selecting a Registered Agent
  3. Creating and Filing the Paperwork
  4. Business Operating Agreement
  5. Acquiring an EIN
  6. Getting Business Licenses/Permits
  7. Filing Decennial Reports

You can either form an LLC in Pennsylvania yourself or get professional help. If you create one yourself, you will save some money in lieu of a professional service fee, etc. However, there will be a lot of legal red tape and paperwork, which will waste your precious time.

Moreover, there is always a risk of you making errors and messing up the paperwork. We are not all lawyers and attorneys after all! Therefore, we suggest that you get professional help forming your LLC.

There are several expert LLC formation service providers out there. You can also read up on our detailed reviews for LLC incorporation services. Our top recommendations are ZenBusiness and IncFile, both highly popular amongst their users.

  • ZenBusiness is known for its useful features, affordable prices, and courteous customer services. With stellar user reviews and multi-tiered package plans, ZenBusiness is a great choice for new business owners!
  • IncFile is a good choice for new entrepreneurs who need professional help but can’t afford to pay hefty fees. IncFile offers a free-of-cost LLC formation package that comes in pretty handy in tight-budget situations!

What is an LLC

Before moving on, let us briefly tell you what an LLC is and how will it benefit your business. A limited liability company is a legal business structure that combines the amazing limited liability feature of a corporation with the lack of formalities and flexibilities of a partnership or a sole proprietorship. 

Any entrepreneur wanting to limit his personal liability for lawsuits, business debts, etc. should form an LLC. For instance, if you run a delivery service, it is likely that you will be late at times. What if the customer decides to sue you?

Will you lose all your belongings in the lawsuit? If you have an LLC, the risk will only be limited to your business assets – your personal belongings such as house, car, etc. will be protected and safe.

Form an LLC in Pennsylvania

To create your LLC in Pennsylvania, there are three main things that you have to do – choose your LLC’s name, find a registered agent for the company, and file the necessary paperwork. The filing fee for the Certificate of Formation is $125. You can file the paperwork online or through the mail.

Let’s delve into the step-by-step process of forming an LLC in Pennsylvania.

Pennsylvania LLC Name

  • Name Availability Search. The LLC name needs to be unique and distinct from the names of all existing businesses in Pennsylvania. Search the Pennsylvania LLC database to make sure that your desired LLC name is available for use. 

So while you are searching for an LLC name, make sure that you check whether the web domain for that name is available or not. This will help you a lot when you are creating a website for your business in the future.

  • Name Rules & Guidelines. There are a few rules and guidelines that you need to follow when it comes to naming your Pennsylvania LLC. For example, the LLC name needs to have a designator at the end such as LLC, L.L.C., Company, Co., etc. 

Moreover, you can’t use designators which will insinuate that you are another type of business entity such as Corporation, Corp, Inc., etc. Furthermore, no vulgar or derogatory words or any terms that will confuse your LLC with a government institution.

  • LLC Name Reservation. Selected your LLC’s name but are not ready to file your paperwork? Your LLC’s name is your brand, it is your identity. It is your first interaction with the target audience. 

Until your LLC is officially formed, the LLC name is up for grabs and any other person can use it. To prevent this, you can reserve your LLC’s name until you are ready to form your LLC. 

You will have to submit a name reservation application with the State of Pennsylvania via mail or online. The filing fee for the name reservation is $70. The name will be reserved for 120 days.

  • Fictitious Business Name. If you don’t want to use the LLC’s official registered name, you can choose a trade name as well. The DBA – Doing Business As – has to be registered with the Pennsylvania Department of State. 

File the application online or via traditional mail and you will be good to do! The filing fee for getting a DBA is $70. When you are searching for name availability, there is another thing that you need to keep in your mind. 

We live in a technologically advanced world and we can’t imagine running a business without having any online presence.

Choosing a Registered Agent for Your LLC

The next thing that you have to do before filing your paperwork is selecting a legally registered agent for your company. A registered agent is a person or business entity that will act as the point of contact between your LLC and the state government.

The registered agent should have a physical street address in the state of Pennsylvania and PO boxes are not allowed. 

When it comes to choosing a registered agent, there are three options. You can be your own registered agent, select a family member, colleague, or friend to become your LLC’s resident agent, or you can hire an expert, professional LLC formation company such as Northwest Registered Agent.

If you become your own registered agent, your personal information such as your name, your address, etc. will become part of the public record. Furthermore, you will have to keep the official working hours in case the state needs to contact you.

This means that you can’t take time off, go on a holiday, etc. Moreover, we are all humans and as humans are prone to making mistakes. If you misplace your mail or forget a deadline, it will have a negative impact on your LLC’s good standing with the state.

The same issues will occur if your acquaintance or family member is the resident agent of your LLC. Therefore, we recommend that you go for the best and safest option – Hire a professional registered agent.

Not only will your privacy remain intact, but you also will not have to worry about keeping office hours or misplacing important mail. 

Filing Your Pennsylvania LLC Articles of Organization

Filing your articles of organization is the most important step in LLC formation. 

You have to provide the following information in the paperwork. Remember that all the information that you will put down on the documentation will become part of the public records. 

  • LLC Name. You will have to give the LLC name that you selected as well as the address of your company. If you don’t want to give out your LLC’s address, you can use the address of the registered agent as well.
  • Registered Agent. The details of the registered agent, such as their name and address, will be part of the paperwork.
  • LLC Organizer. The LLC organizer is the person who forms and files your LLC’s articles of organization. The organizer can be anyone in the LLC, a family friend, etc. However, you should be aware of the fact that the name and address of your organizer will become public so it’s better if you choose an LLC incorporation service to form your LLC. 

In this way, you can use their address without the fear of a breach of privacy.

  • Effective Date. You have the choice to form your LLC immediately or after a period of time. From the time of filing your paperwork, you have 90 days to delay your LLC formation due to any reason, for example, tax period, etc.
  • Type of Business. If you are a professional company such as an accounting service provider, etc. then you will have to specify this as well. Moreover, if you are a benefit company, you will have to mention this since the filing requirements are a bit different for them.

Docketing Statement

Along with the Articles of Organization, you also have to submit a Docketing Statement. It is basically a short form that asks for the information of the person who is responsible for tax reports, etc. 

Moreover, you have to provide information regarding what your business is about so that the state will know whether you are using the business for lawful purposes or not. The LLC filing fee in Pennsylvania is $125 and you can file the paperwork online or through traditional mail.

Previously, walk-in filings were available but due to the COVID-19 pandemic, the protocols changed. It typically takes 7 to 10 business days for your LLC to be formed. You will receive a Welcome Letter along with the approved & stamped certificate of organization. 

Creating the Business Operating Agreement

The next step is to create the business operating document for your LLC. A business operating document is an internal document that you don’t have to mail to the state. You have to keep it with your company records and use it when required.

In an operating agreement, all the members of the LLC are listed along with their shares. Moreover, details about the allocation of profits/losses, etc. are also mentioned. It is basically the primary document that established the powers, rights, duties, obligations, and liabilities of the members of the LLC.

A comprehensive business operating agreement makes sure that all the LLC members are on one page and this reduces the risk of conflict between them.

Getting a Pennsylvania LLC EIN

An EIN is similar to the Social Security Number. While SSN is for a person, an EIN is for an LLC. It is issued by the IRS and is used to open business bank accounts, file taxes, hire employees, etc.

You can apply for an EIN after your LLC is approved from the IRS’s website. You won’t have to pay anything to get an EIN. You can also obtain an EIN via mail, but we recommend you apply online because it is the quickest way.

If you are not a US resident, and don’t have a social security number, then you can’t get an EIN online. You will have to apply via mail and you will have to provide additional information. If you are running a sole proprietorship, and already have an EIN, you will have to get a new one when your LLC is formed.

Filing the Decennial Report

Most states require you to file an annual business report. However, that isn’t the case with Pennsylvania. As an LLC, you will not have to file an annual report. However, you might have to file a Decennial report.

Once every ten years, the Pennsylvania State checks if your LLC has filed anything with the state over the decade. If it has, you will not have to submit a decennial report. Otherwise, you will have to file one. 

The filing fee for the Decennial Report is $70. If you run a PLLC, you will have to file an annual report with the state by April 15th of every year. There is no need for a Decennial report if you are running a PLLC.

A reminder for filing the Decennial Report is sent out a few months before the report is due. If you don’t file the report on time, your LLC name rights will be lost. Other than that, there is no penalty and once you submit the report, your name rights will be restored.

Pennsylvania LLC Business Licenses

The local licenses vary depending on the nature of your business as well as its location. Pennsylvania doesn’t need a general business license for LLCs. However, you have to contact your local county, township, city, etc. to check whether you need a business license or permit to operate. 

To ensure that your business is compliant with all the rules and regulations, and has all the required licenses, we recommend that you take the help of a professional LLC incorporation company such as ZenBusiness or IncFile.

Pennsylvania LLC Business Taxes

By default, LLCs have a pass-through taxation structure. This means that all the profits/losses pass through to the members of the LLC and they file their personal tax returns. You might have to pay local taxes so we recommend that you ask an expert’s opinion on how to manage your LLCs taxes.

The personal income tax in Pennsylvania is a flat 3.07%. Moreover, the state has a sales tax of 6% as well. Furthermore, the local counties also stack on a few taxes. 

LLC in Pennsylvania – Final Word

To run a successful business, you need to put in a lot of effort and hard work. With the help of an LLC, you can ensure that all diligent work doesn’t go down the drain in case your business faces any legal issues. 

Instead of wasting your time going through all the legal paperwork on your own, you need to hire a professional LLC incorporation company. There are several formation services out there that you can hire, but the top-recommendations are ZenBusiness and IncFile.

  • ZenBusiness is known for its useful features, affordable prices, and courteous customer services. With stellar user reviews and multi-tiered package plans, ZenBusiness is a great choice for new business owners!
  • IncFile is a good choice for new entrepreneurs who need professional help but can’t afford to pay hefty fees. IncFile offers a free-of-cost LLC formation package that comes in pretty handy in tight-budget situations!

Here’s to you having a successful LLC in Pennsylvania!

LLC in Pennsylvania – Frequently Asked Questions

You can apply for the EIN from the website of IRS. However, if you don’t have a social security number, you will have to apply via a paper form. To make sure that you do so in the perfect way possible, you should hire a professional LLC incorporation company, though.

The state of Pennsylvania doesn’t legally require an operating agreement from LLCs. However, you need to have one at hand so that when a legal issue arises, you can refer to the rules laid down in the operating agreement to resolve it.

An operating agreement should have the following things at the least.

  • Initial Investments
  • Voting rights
  • Profit/Loss Distribution
  • Rules for the day-to-day operations of the LLC
  • Dissolution of the LLC

Yes, you can certainly form an LLC on your own. Follow the steps that we have mentioned above and you will get your LLC up and running in Pennsylvania. However, the formation of an LLC is a technical and time-consuming process.

As new business owners, it is better that you focus on making your business a success instead of getting lost in piles of paperwork. Therefore, it is recommended that you hire a professional LLC incorporation service that will help you form your Pennsylvania LLC quickly and efficiently.

You have to pay $70 for the Pennsylvania Decennial Report. This is very less as compared to the filing fee of other states and most of them are annual reports as well. It is due after ten years of your LLC formation.

If you have filed anything in the past ten years with the state, you will not have to submit this report. Otherwise, you will have to file the decennial report. It is hard to remember that you have to do something after ten years. 

If you hire a professional LLC formation company, they will remind you even after ten years to ensure your good standing with the state!

No, you don’t have to submit an annual report for a simple LLC. However, if you are running a PLLC ( professional limited liability company) then you will have to submit an annual report and will not submit the decennial report.

If you are going to sell products to customers in the state of Pennsylvania, then you will have to pay sales taxes. For paying the taxes, you will have to register with the Department of Revenue. You can file a physical form or do so online.

The filing fee for an LLC in Pennsylvania is $125. If you want to reserve the name, you will have to pay $70. Moreover, for getting a dba you will have to pay $70 as well. It is better that you hire a professional LLC incorporation service so that they can take care of all the legal requirements!

Cite/Link to This Article

  • Stewart, Suzy. "Pennsylvania LLC: How to Form an LLC in Pennsylvania". One Brick Court. Accessed on April 10, 2021. https://onebrickcourt.com/pennsylvania-llc/.

  • Stewart, Suzy. "Pennsylvania LLC: How to Form an LLC in Pennsylvania". One Brick Court, https://onebrickcourt.com/pennsylvania-llc/. Accessed 10 April, 2021.

  • Stewart, Suzy. Pennsylvania LLC: How to Form an LLC in Pennsylvania. One Brick Court. Retrieved from https://onebrickcourt.com/pennsylvania-llc/.