The Easiest Way to Start an LLC in Hawaii

Quick facts about forming an LLC in Hawaii

Filing Fee	$50 (additional $1 if filed by mail)
Processing Time	1–3 business days online
Annual Report Fee	$15
Registered Agent Required	Yes, must have a physical address in Hawaii
State Franchise Tax	None for LLCs, there is a General Excise Tax
General Excise Tax (GET)	4% of gross revenue (4.5% in Oahu)
Business License	Yes, $20 for a GET license
Managing Authority	Hawaii Department of Commerce & Consumer Affairs

How to start a Hawaii LLC in 5 steps

A detailed explanation of each step follows. Additional information on many aspects of starting an LLC in Hawaii is available from the Department of Commerce and Consumer Affairs’s Business Registration. More general information about LLCs is also available.

1. Name your Hawaii LLC
2. Choose a registered agent
3. File articles of organization
4. Obtain a GET license and Hawaii Tax Identification Number
5. Create an operating agreement
6. Apply for an EIN

Step 1: Name your Hawaii LLC

Start by naming your limited liability company if you haven’t already. If you have, make sure that the name you’ve chosen complies with Hawaii’s LLC naming requirements and isn’t already taken.

All LLCs registered in Hawaii must have business names that comply with the following requirements:

• LLC: The official name must contain “limited liability company” or an abbreviation thereof. Acceptable abbreviations are L.L.C. and LLC. Other abbreviations that Hawaii businesses commonly use include “Ltd.” for limited and “Co.” for company.
• Distinct: The name must be distinct from all other businesses and all trademarks registered in the state. Sometimes a personal name or location can be used to make a business name distinct (e.g., Joe’s Italian Carryout, Big Island Heating and Air Conditioning). The Hawaii DCCA’s Business Registration Division further details the precise regulations that govern whether a business name can be considered similar to another name that’s registered in the state.
• Not Confusing: No business names that could easily be conflated with federal or state agencies are permitted. This extends to agencies such as the FBI, CIA, FDA, NSA, Secretary of State (SOS), Attorney General (AG), Office of Hawaiian Affairs (OHA), Department of Land and Natural Resources (DLNR), and many more. Some Honolulu and other cities’ departments might also have to be considered.
• Restricted Terminology: Certain terminology is restricted from use in business names, unless the business legitimately meets the credentialing requirements. This extends to terms such as doctor, attorney, accountant, bank, insurance and others. Additionally, terms that denote registered historical landmarks or geographic locations are prohibited. Some of the more prominent historically registered places are Aloha Tower, Diamond Head, Honolulu, Kailua Oahu, Kauai, Olamana, Pearl Harbor and Wailuku Maui.

You can check whether a business name is available in by performing a Hawaii business entity search.

Along with meeting all official regulations, it’s also wise to consider the branding, memorableness and URL availability of a name. 

Reserve a business name

Once you have a business name that meets all of the regulations and that you like, you can reserve it through the Department of Commerce and Consumer Affairs (DCCA) Business Registration Division’s Hawaii Business Express.

An account is needed to log onto the platform, but you can access many business documents once you have an account. One of the forms is to reserve a business name. Reservations last for 120 days after they’re accepted. A $10 fee ($25 for expedited processing) is charged to reserve a business name.

Alternatively, you can choose your business name when you officially set up the limited liability company. Choosing a name is part of filing your LLC’s Articles of Organization (see Step 2).

File a trade name/DBA (optional)

While your official business name must have some form of “limited liability company,” the name you regularly use doesn’t necessarily have to contain this or an abbreviation of it. A trade name allows your business to function under an assumed name for marketing purposes.

You can file for a trade name through Hawaii Business Express or by completing an Application for Registration of Trade Name (Form T-1). The form can be mailed to the DCCA Business Registration Division at P.O. Box 40, Honolulu, HI 96810. It alternatively can be dropped off in person at 335 Merchant Street, Suite 201, Honolulu, HI 96813.

The trade name filing fee is $50 ($20 additional for expedited processing).

Trade name is Hawaii’s terminology for doing business as (DBA). The trade name functions essentially as a DBA would.

Register your name for trademark

/products/trademarkYou can further protect your Hawaii LLC’s name by trademarking the name with the DCCA. Trademarking prevents other businesses from using the name for commercial purposes within the state. In some cases, you may want to trademark your business’s official name, trade name, and/or an abbreviation of either.

You can register a trademark for your name online through Hawaii Business Express, or via mail by completing the Application for Registration of Trademark (Form T-2). The form can be mailed to P.O. Box 40, Honolulu, HI 96810, or it can be dropped off at 335 Merchant Street, Suite 201, Honolulu, HI 96813.

The fee for trademarking a business name is $50 ($20 additional for expedited processing). For more information about trademarking in the state, the DCCA has an extensive three-page packet on the subject.

If you’d like to protect your LLC’s name even further, a federal trademark might be available. Extending trademark rights throughout the country (and not just in Hawaii) can prove wise if your business ultimately intends to expand. If you don’t foresee the business expanding into other states, a federal trademark is probably unnecessary.

Federal trademark applications can be filed with the United States Patent and Trademark Office. The searches required, and the filing process can be more intensive than trademarking in Hawaii is.

Step 2: Choose a registered agent

The purpose of a registered agent in Hawaii is to serve as the official contact for your LLC. They may receive tax notifications, service of process notifications, and other important communications from the state or other entities.

You may choose an individual or a commercial registered agent service to act as your LLC’s registered agent:

• Service: Hiring a registered agent service can afford your business greater privacy because the agent’s address can be used as the official contact address. A service is also helpful if you’re unfamiliar with how to manage official communications.
• Individual: Should you choose to use an individual, they must have a street address somewhere in Hawaii (P.O. Boxes don’t qualify). They generally should be available during normal business hours and be comfortable signing for official communications when necessary.

More information about a registered agent is available from the DCCA’s Business Registration Division.

Step 3: File articles of organization

Articles of Organization must be submitted to legally establish your Hawaii LLC. These are the foundational documents for forming this type of business (as well as several other types).

State fees

Hawaii charges a $50 filing fee when you submit the articles of organization, and the fee isn’t refundable. The fee is payable by credit card or check, depending on how you choose to file.

There’s also a $1 state archive fee for non-online submissions (mail, in-person, fax or email), but this nominal charge can be refunded. Hawaii State Archives will refund the fee if you informally ask them to. You can reach the state archives at (808) 586-0329 or [email protected]. 

For further information, we have compiled a complete list of Hawaii LLC fees.

Requirements

The process of actually forming an LLC in Hawaii is fairly straightforward, and generally has only two major requirements:

• Articles of Organization: The Articles of Organization for Limited Liability Company (Form LLC-1) requires information about your new LLC. You’ll have to provide basic details (i.e., name, address, organizers), duration (i.e., at-will or until expiration date), management structure (i.e., manager-managed or member-managed), organizer’s liability (none, partial or all), and a registered agent. All organizers must sign the form.
• Registered Agent: Like most other states, Hawaii requires all LLCs operating in the state to designate and continuously maintain a registered agent. The registered agent is designated in Article III of the Articles of Organization, and they can be an individual or a commercial registered agent service. (See Choose a Registered Agent.)

Select states have additional requirements for operating agreements and/or publication. These aren’t requirements in Hawaii, although drafting an operating agreement still is a best practice. (See Create an Operating Agreement.)

How to file

The Articles of Organization should be filed with the Department of Commerce and Consumer Affairs – Business Registration Division. You can submit the articles several different ways:

• Online: Create an account on Hawaii Business Express and complete the form by following the prompts. Pay the fee by credit card when you complete the filing process.
• Mail: Send a completed and signed form to Department of Commerce and Consumer Affairs, Business Registration Division, 335 Merchant St., P.O. Box 40, Honolulu, HI 96810. Include a check made out to Department of Commerce and Consumer Affairs, written out for the exact amount due.
• In-Person: Bring a completed and signed form to the Business Registration Division’s office, which is at 335 Merchant St., Room 201, Honolulu HI 96810. Pay the filing fee by credit card, check or cash while at the office.
• Fax: Send a completed and signed form to the Business Registration Division at (808) 586-2733. Include a completed Business Registration Division Credit Card Transaction Form to pay the filing fee by credit card.
• Email: Send a completed and signed form to the Business Registration Division at [email protected]. Include a completed Business Registration Division Credit Card Transaction Form to pay the filing fee by credit card.

If submitting a paper form (mail, fax or email), the form must be completed in type or black ink, but scans and photocopies are accepted. More information can be found on the DCCA’s Business Registration – Domestic Limited Liability Company page.

How Long Does It Take to Get an LLC in Hawaii?

The time it takes to form an LLC in Hawaii depends on how you file your formation documents.. If you file online through the Hawaii Business Express portal, your LLC is usually approved within 3 to 5 business days. Online filings move faster because they’re processed automatically and don’t require manual handling.

If you choose to file by mail, expect it to take up to 2 weeks, not including mailing time. Paper filings must be manually reviewed by the DCCA, which can extend processing times, especially during peak filing periods like the start of the calendar year.

If you’re in a hurry, Hawaii also offers expedited processing for an additional $25 fee, which can reduce approval to 1 to 2 business days for online submissions. This is a good option if you need your LLC approved quickly to open a business bank account or sign contracts.

Step 4: Obtaining a GET License and Hawaiʻi Tax ID

Every LLC doing business in Hawaiʻi must register with the Hawaiʻi Department of Taxation to obtain a Hawaiʻi Tax Identification Number (HI Tax ID) and a General Excise Tax (GET) license. These registrations allow the state to track your tax filings and authorize your business to collect and remit the GET, which applies to nearly all business activity in Hawaiʻi.

How to Register

After forming your LLC with the Department of Commerce and Consumer Affairs, your next step is completing the State of Hawaiʻi Basic Business Application (Form BB-1). This application is used to obtain both your HI Tax ID and your GET license. You can file online through the Hawaiʻi Tax Online portal or submit the form by mail.

Costs

The fee to obtain a GET license and HI Tax ID is a one-time cost of $20. This fee is paid when submitting the BB-1 application. There is no annual renewal fee for the GET license, but you must continue filing GET returns for as long as your LLC is conducting business in the state.

After You Register

Once your application is processed, the state will assign your HI Tax ID and issue your GET license. Your LLC will then be responsible for filing GET returns monthly, quarterly, or annually, depending on your total gross income. Because the GET applies to gross receipts, most LLCs factor this into their pricing or operating budget. More information is provided in the tax section below.

Step 5: Create an operating agreement

The purpose of an operating agreement is to clearly explain the legal structure of an LLC. A well-drafted agreement will detail roles, ownership stakes, and the general operations.

The ownership section of an operating agreement should list each owner and what responsibilities and privileges they have. Contribution requirements, disbursement payments, management changes, ownership changes and dissolution are some main points to cover. 

Non-ownership issues, such as the general carrying out of operations, can also be detailed. So can miscellaneous items that owners would like to address when forming the LLC.

Is an operating agreement a must?

Although LLCs are not required to draft a Hawaii operating agreement, but creating one is recommended. Some of the issues covered in an operating agreement (e.g., management structure) are questions on the Articles of Organization.

Additionally, a thorough operating agreement can head off any disagreements that might arise later over owners’ contractual obligations.

State requirements

Since Hawaii has no operating agreement requirement, there isn’t an official list of what should be covered by an operating agreement. If the Articles of Organization are used as a guide, however, ownership, duration, management and individual liability should all be included. So too should details such as those mentioned above (i.e., contributions, disbursements, etc.).

Step 6: Apply for an EIN

Per federal tax regulations, all LLCs in the United States need to obtain an employer identification number (EIN). An EIN may alternatively be referred to as an FEIN or FTIN at times.

An EIN acts as a unique identifying number for an LLC, similar to how a Social Security number (SSN) is a unique identifying number for individuals. You’ll use an EIN to identify your LLC when filing taxes (both federal and state), hiring new employees, and opening new financial accounts.

You’ll obtain an EIN from the IRS (and not Hawaii or another agency). The number is obtained by submitting IRS Application for Employer Identification Number (Form SS-4), which you can do several different ways:

• Online: Complete the form directly on the IRS’s website. The online form is only available between 7 am and 10 pm EST, Monday through Friday.
• Mail: Send a completed and signed form to Internal Revenue Service, Attn: E.I.N. Operation, Cincinnati, OH 45999.
• Fax: Send a completed and signed form to the IRS at (855) 641-6935.

There is no fee regardless of how you choose to apply. The fastest option is online during the allotted hours, as this will result in the immediate issuance of a number.

You can alternatively use a service to conveniently take care of obtaining an EIN. We offer a hassle-free service, taking care of the entire process and quickly obtaining a number for your LLC.

What to do after you’ve opened an LLC in Hawaii

After completing all initially required filings, your LLC should be officially formed. There are some additional details that should be attended to at this time, so you can ensure the smooth operation of your business.

Understand your ongoing LLC fees

All LLCs are required to file an annual report in Hawaii along with a $12.50 fee. A late fee is assessed if annual filing doesn’t get completed on time, and failing to make an annual report for two years in a row can result in automatic dissolution.

The annual report is filed through Hawaii Business Express’s Annual Business Reports page. Payment can be made with a credit card when submitting the annual report.

Obtain relevant business licenses and permits

Depending on what your LLC does and where it’s located, you might have to secure licenses and/or permits. While Hawaii has some license and permit requirements, most of these are regulated by local municipalities.

A nearby attorney who helps businesses in the area should be familiar with all locally required licenses and permits. Someone in the municipal or county government will also know whether anything is required.

If you need any licenses or permits, be prepared to pay a small fee when obtaining them. It’s not uncommon for local governments to charge $100 or less for most, but some may have higher fees. Again, an attorney or government worker will know the exact fees for your area.

Comply with the State’s tax requirements

Once your LLC is officially formed and has its own EIN, the business will need to comply with a host of tax requirements.

How your LLC will be taxed

LLCs are known as “pass-through” businesses, as they don’t actually pay taxes on revenue. Instead, they pass any revenue taxes onto business owners (and others) in the form of income tax.

This isn’t to say that LLCs don’t pay other taxes, however, and they also commonly remit taxes to the Hawaii Department of Taxation and the IRS.

The amount that’s taxed at these rates depends on whether an LLC is taxed as an LLC or an S Corp. You can choose between the two options, which is a somewhat more recent choice that the IRS has allowed:

• LLC Taxation: Standard taxation has owners pay both income tax and FICA tax (see below) on all the money they receive from the business. All income is subject to both types of tax.
• S Corp Taxation: The alternative S Corp taxation still requires business owners to pay income tax on all the profits received, but FICA isn’t paid on all profits. This option lets business owners pay themselves what amounts to a “reasonable salary” for the work that they do. What constitutes a reasonable salary depends on an owner’s role.
Both income and FICA taxes are still paid on the reasonable salary that owners receive. Any additional disbursed profits are only subject to income tax, and not FICA.

The Federal Insurance Contributions Act (FICA) assesses taxes to fund Medicare and Social Security. The combined FICA tax rate is 7.65%, which breaks down into a Medicare tax of 1.45% and a Social Security tax of 6.2%.

The S Corp taxation option is more complicated than the simple LLC setup, and you should be prepared to pay additional bookkeeping, payroll and accounting fees if you opt for S Corp tax status. Avoiding the 7.65% FICA tax could result in significant savings if owners receive sizeable disbursements simply on account of their ownership interest.

FICA taxes only apply to federal taxes, and thus choosing S Corp status won’t actually impact how Hawaii taxes salary and disbursements at the state level.

Because this is a somewhat complex decision, you should consult an accountant before opting for S Corp status. An accountant will know how to evaluate which option is best for your LLC’s situation. (Should you need to change the taxation selection, you can do so annually.)

Income tax

Income tax is paid on all money earned from your LLC, regardless of which taxation option is chosen. Both salaries and profits/distributions are subject to income tax.

Federal and state income taxes both follow a tiered system, where higher rates are changed on higher incomes:

• Federal income tax ranges between 10% and 37%
• Hawaii income tax ranges between 1.4% and 11%
• Local municipalities normally don’t charge income tax in Hawaii

Which federal and state forms are filed to report income from an LLC depend on the LLC’s structure and owners:

• Federal: The Partnership Return (Form 1065) or the Schedule C (Form 1040) can be filed to report income with the IRS. The former is most often used for multi-owner LLCs and the latter for single-owner ones.
• State: The Hawaii Individual Income Tax Return (Form N-11) is the most common form that’s filed with the Hawaii Department of Taxation. Other forms may be used if you’re out of state, or in certain other situations. If another form is needed, all forms can be downloaded from the Division’s Tax Forms and Publications page. There’s also a searchable database of state forms.
• Federal Unemployment Tax

Owners of LLCs can have an accountant or other qualified tax professional file income taxes arising from a business. Alternatively, individuals can complete and submit the forms themselves.

Sales tax / General excise tax

Hawaii doesn’t have a statewide sales tax, but instead uses a general excise and use tax. General excise tax tends to be broader, and can be assessed on almost all business activities. Products, services, commissions, rental incomes and more are all usually subject to this tax.

The statewide general excise tax (GET) is 4% for most transactions, except wholesale transactions are taxed at a lower 0.5% rate. Oahu additional adds its own 0.5% surcharge on local non-wholesale transactions, using revenues from the surcharge to fund the city’s mass transit. There isn’t any federal general excise or sales tax.

Because the state’s general excise tax is so broad, your LLC will undoubtedly be responsible for collecting it and remitting it. The tax might be remitted monthly, quarterly or annually. It can be paid through Hawaii Tax Online or by mailing in the appropriate general excise and use form, and most businesses remit payments either monthly or quarterly.

Self-employment tax

Should you choose the LLC taxation option, FICA taxes will be replaced by self-employment tax. 

Self-employment tax encompasses both the individual’s and the business’s Social Security and Medicare tax responsibilities. Traditional employees pay 7.65% FICA tax, and their employers pay 7.65% FICA tax. Since your LLC doesn’t actually pay any FICA tax, the burden is passed onto you in the form of a doubled self-employment tax.

The self-employment tax rate is 15.3%, which includes 12.4% Social Security tax and 2.9% Medicare tax.

Should you need to pay self-employment tax, quarterly payment of your estimated self-employment tax may be required. Estimated payments can be made through Hawaii Tax Online, or mailed along with an Individual Income Tax Payment Voucher. Mail-in payments are sent to Hawaii Department of Taxation, Attn: Payment Section, P.O. Box 1530, Honolulu, Hawaii 96806.

Payroll taxes

Should you choose the S Corp taxation option, FICA taxes will be assessed on your reasonable salary at a rate of 7.65%. These are paid by your LLC. 

Payroll taxes don’t apply if you choose the LLC taxation option, as the 7.65% is already included in self-employment tax.

Other state taxes

Hawaii doesn’t charge any other state taxes, but there is an annual report fee of $12.50. The annual report can be filed online through Hawaii Business Express. The platform has a specific page for finding your business and filing the report.

Open a separate bank account

Business finances should be maintained apart from personal finances so your LLC will need its own bank account..

On an accounting level, separate business finances make it easy to see a business’s revenues, expenses and profitability, which in turn makes it easier to give owners correct distributions. Should your business ever be audited, separation will also be helpful when answering questions. Maintaining separate finances also lends your business an air of credibility when receiving or making payments, and sometimes can help maintain the LLC’s corporate veil.

FAQ