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How to Set Up an Arkansas LLC on Your Own

Technically speaking, you don’t have to use an LLC formation service like ZenBusiness or LegalZoom. These services are incredibly helpful, but you can save money by completing the process yourself.

You can read our complete guide to DIY an LLC setup in Arkansas, but here’s a quick look at the process:

Choose a business name

Every LLC in Arkansas needs a name that’s memorable and gives potential clients a good idea of what goods or services are available. The name also needs to be unique — both for legal reasons and so your business stands out from the competition.

Appoint an AR registered agent

As we’ve mentioned in this guide, every LLC needs an agent who can accept service of process on your behalf. In all states, you can act as your own registered agent as long as you have a physical address in the state. That said, we generally recommend that you appoint someone else (like an online service) to act as your agent.

File the Articles of Organization

This document, once filled out and filed, officially forms your business in the state of Arkansas. You’ll need to provide some important information, including your contact information, your business address, signatures for your LLC’s members, and more. Arkansas has a $45 filing fee.

Setting up the LLC is as easy as 1-2-3; it’s the maintenance requirements that are a bit more complicated:

Register for and pay taxes

If you have employees, you’ll need to get an Employer Identification Number from the IRS. Then there are state-specific taxes, too. Arkansas charges graduated income taxes; the individual rates range between 5% and 6.9%, and corporate rates fall between 1% and 6.5%. Beyond that, the biggest tax burden is the Franchise Tax. You will also need to account for sales taxes (6.5%) and other miscellaneous taxes. More information can be found at the Arkansas Department of Finance and Administration.

Get licenses and permits

There’s no general state business license in Arkansas, but many local cities and counties require them. You may also need to apply for industry licenses; you can find a full list of professional licenses at the Arkansas Division of Workforce Services.

Create an operating agreement

Even single-member LLCs should create a “master document” that sets out how the business will operate, both now and in the future.

File your annual report

The Arkansas annual report actually goes hand-in-hand with the annual franchise tax, so you’ll file with the Department of Finance and Administration, not the Secretary of State. There is a minimum tax of $150 annually.

Obtain business insurance

Every business with employees needs to maintain workers’ compensation insurance and a commercial vehicle policy for company-owned vehicles. You may also want to get a general business liability policy, too.

Get a business bank account

You should sign up for a business bank account so you can write checks and make purchases in the name of the business instead of pulling from your personal accounts (a legal no-no).

This is just the tip of the iceberg, though. For more detailed guidance, we recommend contacting an attorney or checking out the full Arkansas LLC Formation Guide.

What Is an Arkansas LLC?

LLCs are formal legal entities that are typically taxed similarly to sole proprietorships and general partnerships, in that the owners include any company profits or losses into their personal returns — the LLC itself does not owe income taxes. For more a more in-depth description see: What is an LLC?

The Total Cost of Forming and Maintaining an LLC in Arkansas

In addition to the costs of a business formation service or hiring an attorney (which are optional, as we’ve discussed), there are quite a few other required and optional expenses when forming and maintaining an Arkansas business. You cannot form an LLC in Arkansas without filing the Certificate of Organization, the document that officially registers your business in the state. This document costs $45 to file electronically and $50 to file by mail.

Your LLC will also need to file the Annual Franchise Tax Report each year. There is a flat filing fee of $150. This form is pretty simple, but it keeps the state up-to-date about some vital business information. Read more about Arkansas costs – Arkansas LLC costs.