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Pennsylvania is a good place to start a limited liability company (LLC). Pennsylvania, unlike most other states, doesn’t charge an annual fee for most LLCs. Pennsylvania also doesn’t require that you purchase advertising to form your LLC.
The state has an excellent business climate that welcomes new businesses. It attracts new residents with a low cost of living combined with a high quality of life. Pennsylvania’s economy is vibrant and diverse.
It takes only 6 steps to start an LLC in Pennsylvania, get it registered with the state, make it official, and set a strong foundation for the future! Soon, you can be the proud owner (called “member” in LLC-speak) of your dream business.
Below you’ll find a detailed explanation of the steps you need to follow to start an LLC in PA.
Here’s a preview of the steps:
Below, you’ll find a detailed explanation to walk you through each step.
The first step is to pick a name for your LLC. When you register your LLC, the name you select will become the legal name for your company.
In the future, you must always use this name on your taxes or whenever you are asked for the LLC’s legal name. However, you may use a different name, called a “fictitious name” or “DBA” name, when the legal name is not required. We’ll be talking more about this below.
Because the legal name will be registered and official, you have to follow some naming rules. Pennsylvania requires that your LLC name:
How do you find out if your LLC name is unique? You can search the state’s database of registered business names to see if any business in Pennsylvania is already using your desired name.
After you’ve selected a name, you need to register it with the PA Department of State Bureau of Corporations and Charitable Organizations. You do this as part of filing the Certificate of Organization form. See Step 3 below for more detailed instructions on how to file the Certificate of Organization.
If you are not yet ready to form your LLC by filing the Certificate of Organization, you can still reserve your chosen LLC name for 120 days. While your name is reserved, no one else can claim it.
Fill out the Name Reservation/Transfer of Reservation form. File it online, along with a $70 fee, using the Penn File system. You can also mail the form with a $70 check made out to the Department of State, sending it to:
Pennsylvania Department of State
Bureau of Corporations and Charitable Organizations
P.O. Box 8722
Harrisburg, PA 17105-8722
The State’s Bureau of Corporations will check to make sure that your LLC name is unique. Don’t start using the name until you hear back from the Bureau that the name is available.
This would also be a great time to check for domain name and social handles availability, to kickstart your online presence.
The LLC name you register with the state on the Certificate of Organization form is the LLC’s legal name. Sometimes, owners want to conduct business under a different name. For example, if your LLC’s legal name is “Jane Smith’s Fine Baked Goods,” and you want to use the name “Magical Cupcakes” in your marketing campaigns or as the name of your store, you have to register the “Magical Cupcakes” name with the Pennsylvania Department of State’s Bureau of Corporations and Charitable Organizations as a fictitious business name.
Although “fictitious name” may sound like something you call the heroine in a romance novel, all it means for your LLC is that it’s a name that is not your own legal name or your LLC’s legal name. A fictitious business name is often called a “doing business as” name, usually abbreviated as DBA. It may also be referred to as the “trade name,” “trading as,” or “T/A.”
In Pennsylvania, unlike in many other states, your fictitious business name doesn’t have to be unique. So you don’t have to check to see if it’s already being used the way you did when you registered your LLC’s legal name.
To register your fictitious business name, fill out the Registration of Fictitious Name form. You will need to include the fictitious name, a brief statement about your business, a street address for your business, and the names and street addresses of the LLC’s members.
The filing fee to register the fictitious name is $70. If you send the form in by mail, enclose a check made out to the Department of State, and send it to:
Department of State
Bureau of Corporations and Charitable Organizations
P.O. Box 8722
Harrisburg, PA 17105-8722
It’s usually more convenient to submit the form and fee online using the Penn File system.
If you want to register your LLC’s name as a trademark, file the state’s Registration of Trademark or Service Mark form. If your trademark is approved, it will be valid for 5 years. You can renew it within 6 months of the time it expires.
You’ll need to include:
Mail the completed Registration of Trademark form, along with a $50 fee to:
Pennsylvania Department of State
Bureau of Corporations and Charitable Organizations
P.O. Box 8722
Harrisburg, PA 17105-8722
Your Pennsylvania LLC must have a registered office. (In other states, this is often called a “registered agent.”) You will need the address when you file your Certificate of Organization.
The address of your registered office can be the same as the LLC’s address, but it doesn’t have to be. It must be in Pennsylvania, and it has to be a physical address, not a PO Box.
Pennsylvania works a little differently than other states. Elsewhere, you would need to provide the name of a registered agent, who must meet certain requirements that vary from state to state. In Pennsylvania, you only need to register an address, not a person.
The registered office must be a place that can receive legal documents. You have two choices for fulfilling this requirement:
We would be glad to help you with the CROP option.
Learn more about what is a PA registered office here.
To make your Pennsylvania LLC official, you need to file a form called a “Certificate of Organization Domestic Limited Liability Company” with the Pennsylvania Department of State Bureau of Corporations and Charitable Organizations. When the Bureau approves your application, your LLC will be officially registered and ready to start its life as a legal entity!
The filing fee for the Certificate of Organization is $125. This fee is nonrefundable.
In the upper left, enter the mailing address where you want the Bureau to send you the filed document and any correspondence. If you give an email address, the Bureau will email you a link where you can download the filing.
Provide the name of your LLC. This will become the LLC’s legal name that you’ll use when filing taxes and for all other official purposes. As mentioned in Step 1, you should check the list of Pennsylvania business names before you request your LLC name to ensure another business has not already registered it.
Include as part of the name either “company,” “limited,” “limited liability corporation,” or an abbreviation of one of those terms. Make sure the spelling and punctuation of the name are exactly the way you want them.
Provide the LLC’s address. This may be either the registered office address or the name and county of a commercial registered office provider. The address must be in Pennsylvania.
List the names of all the people organizing the LLC. If you are forming the LLC on your own, just put down your name.
Check off the appropriate boxes if you provide restricted professional services or are forming a benefit company.
All organizers must sign the certificate.
Include a completed Docketing Statement form when you send in the certificate.
You can file the Certificate of Organization online at the Department of State’s Penn File system. To use online filing, you’ll need to set up an account at Keystone Login if you don’t already have one.
If you don’t want to file the certificate online, you can send it in by mail. Include the $125 filing fee as a check made out to the Department of State. Mail the certificate, Docketing Statement, and check to:
Pennsylvania Department of State
Bureau of Corporations and Charitable Organizations
P.O. Box 8722
Harrisburg, PA 17105-8722
If you have questions about these procedures, you can call the Bureau of Corporations at (717) 787-1057, or check their website. However, the Bureau cannot give legal advice. If you want to know how Pennsylvania law is interpreted or how it applies to your LLC, you should consult a Pennsylvania lawyer who has experience with LLCs.
When you apply for an LLC in Pennsylvania, as in any other state, it’s always a good idea to consult with a lawyer with relevant experience, especially if you are doing it for the first time.
Using a service like Tailor Brands, can also help you automate the process and make the application as hassle free as possible. This will give you more time to focus on what matters most – building your business.
An operating agreement puts in writing the ways that your LLC will be managed and run.
In Pennsylvania, you’re not required to have an operating agreement, but it’s a very good idea to have one.
In multi-member LLCs, the operating agreement helps prevent disputes among the members. The agreement should cover all aspects of the business, including each member’s contributions and responsibilities.
Even if you are the only member of your LLC, you should still have an operating agreement. It helps show that you and your business are separate, which may be important in protecting your limited liability.
Your LLC’s operating agreement may include:
If your LLC has more than one member, all the members should review the operating agreement and sign it.
Pennsylvania has no special requirements for operating agreements. You don’t need to file the agreement with the state. Just keep a copy in a safe place.
Businesses use an employer identification number, usually referred to as an EIN, when they file their taxes. In Pennsylvania, you’ll need an EIN for your LLC if it has more than one member, if it has employees, or if it files taxes as a corporation.
If you are the only member of your LLC, you don’t have any employees, and you don’t pay corporate taxes, you can get your own EIN, but you don’t have to. If you want, you can pay taxes using your Social Security number instead.
There are some advantages to having an EIN even if you aren’t required to get one. An EIN provides protection from identity theft in situations where you would otherwise have to give out your Social Security number. Having an EIN may also give your LLC more credibility.
You can apply for an EIN online on the IRS website. You must do this in a single session, or you will have to start over. The online system is available Monday to Friday, 7 a.m. to 10 p.m.
You can also apply by mail or fax. Fill out Form SS-4: Application for Employer Identification Number. Fax it to (855) 641-6935 or mail it to:
Internal Revenue Service
Attn: EIN Operation
Cincinnati, OH 45999
The easiest way to get an EIN is to let us take care of it for you! This is a service we are glad to offer our LLC customers.
If your LLC is making a profit, you will have to pay income taxes. There are also taxes you may have to pay if your LLC has employees. It’s a good idea to consult a Pennsylvania tax professional to find ways to minimize your tax bill.
Pennsylvania provides three ways to file and pay your LLC’s state taxes. You can pay online using the Department of Revenue’s e-TIDES system. If you prefer, you can use the state’s TeleFile system by calling 1-800-748-8299 or use state-approved third-party software.
Even though your LLC is a business, you pay its income taxes at your personal income tax rate (unless the LLC is organized as a C corporation).
If you have a single-member LLC, the IRS calls that a “disregarded entity.” This term may bring to mind a sad image of an LLC being shunned and ignored. In reality, it just means that the IRS considers the LLC to be an entity that is separate from you as far as your personal risk, but not separate from you for tax purposes.
The IRS treats multi-member LLCs the same as partnerships.
When you have an LLC, the income from the LLC usually gets passed through to the members. If you are the only member of your LLC, then all the income gets passed through to you, and you claim it as personal income on your individual federal and Pennsylvania state tax returns.
If you have a multi-member LLC, then the income gets distributed to the members according to the terms in the operating agreement. Each member will claim their share as their personal income and pay taxes at their individual rate.
There is an exception. If your LLC is organized as a C corporation, then the income doesn’t get passed through. Instead, the LLC pays the income tax, which will be at the corporate, not the individual, rate.
If your Pennsylvania LLC makes taxable sales or provides taxable services, you must register for a sales tax license. You can do that online or by filling out a Pennsylvania Enterprise Registration form available at the Pennsylvania Department of Revenue site or by calling 1-800-362-2050. You must renew the license every 5 years and display it at your place of business.
You’ll need to report your sales tax and remit it periodically to the Pennsylvania Department of Revenue. For more information, see the Department’s Pennsylvania Sales and Use Tax online brochure, or consult a Pennsylvania tax professional.
When you were an employee, your Social Security and Medicare taxes were deducted from your paycheck. Your employer also paid an equal amount on your behalf.
As an LLC owner, it works differently. Instead of having these taxes withheld, you pay them directly to the IRS when you file your federal taxes. Also, you are responsible for paying both the employee’s and the employer’s contributions.
While you are paying your own Social Security and Medicare taxes, you also have to pay the employer’s share of those taxes for your employees, if you have any.
You may not need to deal with this right away if you’re not planning to hire anyone just yet. But as your business grows, the day may come when you hire your first employee.
This will be thrilling, but it will also come with new responsibilities. Your payroll and accounting systems need to be set up correctly to account for these taxes.
If you have employees, you may need to pay unemployment taxes, withholding tax, and workers’ compensation coverage. You can register for these taxes through the Pennsylvania Online Business Entity Registration.
Congratulations! Your LLC is official! Now, there are a few things you can do to make sure your new business gets off to a great start.
Having a separate business bank account for your LLC makes it easier to keep track of your business’s income and expenses, which will be a big help at tax time. A business account also projects a more polished and professional image.
If you have a single-member LLC, having a business bank account separate from your personal bank account helps provide evidence that you and your business are different entities. This may be important in strengthening your claims of limited liability.
In most states, LLCs have to pay annual fees. But in Pennsylvania, a limited liability company does not have to pay annual fees unless it is a “restricted professional limited liability company (PLLC).” PLLCs provide professional medical, legal, veterinary, or psychology services.
If you do have a PLLC, you’ll need to file a Certificate of Annual Registration and pay a fee equal to $610 multiplied by the number of members of the PLLC.
Setting up your financial systems now will get your new business off to a great start and set a solid foundation for the future.
This is a good time to consult a professional. A tax advisor, lawyer, or accountant will help you get all the tax benefits available for your business. Choose a professional who has experience working with LLCs.
You might need a license or permit for your Pennsylvania LLC, depending on the type of business. Starting your LLC in PA is just the first step on your business journey, and making sure you acquire all the necessary licenses and permits will help to keep you and your business in good standing with the state.
If your business impacts the environment or public health, you will need permits from the Pennsylvania Department of Environmental Protection. Other common types of permits and licenses include local (city or county) permits, professional licenses, and zoning permits. You can contact the Pennsylvania Business One-Stop Shop for help in finding out if your LLC needs any permits.
This portion of our website is for informational purposes only. Tailor Brands is not a law firm, and none of the information on this website constitutes or is intended to convey legal advice. All statements, opinions, recommendations, and conclusions are solely the expression of the author and provided on an as-is basis. Accordingly, Tailor Brands is not responsible for the information and/or its accuracy or completeness.
