Forming an LLC (Limited Liability Company) in Alaska is easy and affordable. The following are few procedural steps on how to start an LLC in Alaska. LLCs can be formed in two ways, domestic and/or foreign. If you are planning to set up an LLC in states other than Alaska, visit How to Start an LLC.
On this page, you’ll learn about the following:
- Why an LLC in Alaska
- How to Form an Alaska LLC
- After Starting your Alaska LLC
- Top businesses to start in Alaska
Why an LLC in Alaska
There are several reasons why one should form an LLC in Alaska. Apart from the prime location and rich natural resources, the state is proved to be the most business-friendly place in Northern America. Located in the north-west side of the United States, Alaska has tourism, fishing, natural gas, and oil industries to dominate their economy.
In the past few years, significant economic development takes place that encourages people to form Alaska LLC. A business-friendly, with low tax, Alaska is an appropriate state for forming an LLC.
- Microloan Program for Women – If you are a woman and in Alaska, then it would be easier to start your business. Under this facility, women entrepreneurs can get up to $10, 000 for their start-ups.
- Small Businesses Economic Development – Under this facility, an LLC can get a loan amount of up to $300,000 for the formation or expansion of their LLC.
- Rural Development Fund – LLCs that are placed in community areas can get this financial support. To qualify for the loan one has to choose an area with not more than a population of 5000. Up to $150,000 for an individual and $300,000 for businesses owned by more than two people. The tenure of such loan repayment is up to 25 years.
If you want to set up your start-up in the state of Alaska, you will certainly enjoy various tax benefits. The state offers tax credits to the businesses that enhance the education sector, area development, and of course economic development.
- New Area Development – Businesses that are located on the northern side or operating in that area may receive a tax credit of up to $6 million. A specific location such as places located south of 68 degrees North Latitude is qualified for this credit facility.
- Contribution to Education – You may enjoy a tax benefit of $5 million in a year if your company contributes to the Universities and non-profit colleges. 50% tax benefits will be given to the company for a contribution of $100,000. For contributing amounts between $100,000 and $300,000, a 100% tax credit will be provided.
- Tax benefits for Veteran Employment – If your LLC employs veterans (disable or non-disable), then you can enjoy tax credit of up to $2000 for non-disabled veterans and $3000 for disabled veterans in Alaska.
Lowest Tax Burden in the United States
Alaska, along with the other six states such as Florida, Washington, Texas, Nevada, South Dakota, and Wyoming has the lowest tax burden in the entire United States. In 2009, it earned 4th Rank in State Business Tax Climate Index.
No Residency Requirement
To operate or form an LLC in Alaska, you do not need to reside in the state. You can take LLC services to get your documentation done. All you have to do is find a good LLC service, appoint a registered agent who has a permanent address in the state, pay filing fees, fill up the forms and the work will be done.
How to Form an Alaska LLC
Suppose you’re planning to invest in a profitable type of business or maybe about to set up your business in Alaska. In that case, forming an LLC in Alaska is the simplest option for you.
An LLC or a Limited Liability Company a hybrid business entity combining a corporation’s characteristics with a partnership or sole proprietorship. This section gives you a step-by-step guide on How to Start an LLC in Alaska.
Step 1: Decide a Name for Your LLC
If you are to start an LLC in Alaska, the first thing you do is decide on a business or company name, and how to name your LLC may be tricky. Thus, you have the option to choose a name that complies with the Alaska business naming requirements. It must also be easily searchable for potential clients. Here is a step-by-step guide to follow when naming your LLC.
Why do you need a proper business name?
If you want your LLC to have special identification, your company name is essential. However, many people face lots of issues by avoiding focus on choosing a business name for their Alaska LLC business formation filings.
Because of this, here are some of the major benefits of choosing the best LLC corporate names.
- To help establish a company’s presence in the market, a proper business entity type will help you. This also creates a new identity that will resemble your LLC.
- After you’ve properly chosen the name for your LLC, you will have no problems finishing the registration process.
- You can only get the EIN number when you have your name registration certificate with you.
What are the requirements when deciding a name for your LLC?
A name search is vital to make sure your business’ name is unique. Check the availability of your name with Business Entity Search on the Alaska Secretary of State’s website. Reserve the name by completing the Name Reservation Request Form for Domestic Entities.
- Don’t include words that could confuse people about your company. Words like ‘treasury, state department.’
- You should also avoid restricted words like ‘bank, attorney, university,’ because they may require a lawyer and more paperwork.
- As for a business website and your URL name, check if your name is still available for domain use with NameCheap.
Reserve a business domain
Even if you don’t have plans to set up a website today, it will help if you buy a domain to avoid others from using your name for their website, so do visit NameCheap for your domain name and Kinsta for web hosting.
If you have decided on your URL name and have reserved it, set up a professional email account with Google GSuite.
Step 2: Assign a Registered Agent in Alaska
A registered agent, or business entity, is a person that will act or work on your behalf. This person or business will receive significant tax forms, legal documents, a notice of lawsuits, and other official government correspondence in Alaska. Choosing Alaska-registered agents for your LLC is required.
Make sure your registered agents are residents of Alabama. It could also be a business. Here are the recommended agents and employees for you:
These five LLC formation services are recommended agents’ registered services as they are authorized to conduct business in Alaska. Compare them to check the best yet cheapest option for you. Besides, they can guarantee you professional service because they have been operating their business for years.
Step 3: File Articles of Organization in Alaska
A Certificate of Name Reservation is needed to file Articles of Organization, as other states call it. You need to make reports of this certificate with the Alaska Secretary of State. You may file them online or by mail, which costs $250.
This Certificate of Formation is a legal document needed to form your successful business officially. It will indicate details about your LLC in Alaska, like if it is a member-managed or managers-managed.
Before you start filings, you must already have your LLC name and registered agents or employees. You will attach a copy of your Name Reservation Certificate along with a list of the services that your Alaska LLC will offer.
How to File Online
Go to the Secretary of State Online Service. Select “non-subscriber.” Fill out the online form. The website will alert you if your county does not support online filings after selecting your principal county.
How to File by Mail
If you prefer filing real-life forms for your Indiana LLC registration, then you can download the Alaska Limited Company Certificate of Formation. Read the form thoroughly and fill it out. It will have to fill, among others, your name, city, state, zip code, and signature.
Step 4: Create Your Alaska LLC Operating Agreement
An operating agreement is a document that legally outlines the proprietorship and operating procedures of your LLC This document is vital as it ensures that all business owners are on the same page regarding how they operate, thus reducing future conflicts.
Starting an LLC in Alaska does not require you to have a comprehensive operating agreement, but it is ideal to have one that contains all your details of business operation.
Step 5: Filing a Alaska LLC EIN
The Employer Identification Number or, simply, the E.I.N. is a nine-digit number given by the Internal Revenue Service (IRS) to make it easier to identify types of business for tax purposes. It is like a Social Security number dedicated to a business.
It is also called a Federal Employer Identification Number (FEIN) or a Federal Tax Identification Number (FTIN). You will need this number for tax filing and to determine tax classification options. This would be necessary for community and economic development.
Internal Revenue Service
Attn: EIN Operation
Cincinnati, OH 45999
Fax: (855) 641-6935
After Starting your Alaska LLC
After forming your LLC, there are still some things that you will need. Take note of the following:
- Get a company business account
- File Alaska business permits & licenses
- Get liability for business insurance with coverage for employees
- File an Alaska LLC annual report or biennial report
- Already existing LLCs that wish to operate in Alaska must register as a foreign Alaska LLC.
This page has provided you with steps to LLC formation and filing processes. You now have to remember upcoming filing deadlines and filing fees or filing costs, including fees for late filings to make sure your LLC is up-to-date. It is also necessary to know when to file federal taxes like federal income taxes, employee taxes, and self-employment taxes.
Top businesses to start in Alaska
If you have successfully decided to form an LLC in Alaska, then the next decision is regarding businesses that one can choose. So, here are the best businesses that are most successfully running in Alaska state. Here is a list of top businesses that you can choose from.
1. Oil And Gas Servicing Business
Those who don’t know the ranking of Alaska should note that it is 4th in the country. A notable amount of share to the state’s GDP is due to the large production of crude oil. Now there are big bulls in the field of production, but still, there is a scarcity of servicing businesses. Now machinery that works 24*7 will go through wear and tear and require timely servicing, which increases the scope of this business growth.
2. Frozen Fishing Foods Business
If you see the coastline of Alaska, then it is the longest in the USA, which makes it a perfect place to do frozen fish-related food business. The supply from one state to another is mainly done in frozen form to keep the product safe for eating purposes. Moreover, Alaska has also become one of the most significant hubs for fish export business, due to which one can think of starting this frozen fish and seafood business in Alaska.
3. Petroleum Product Marketing
With the vast amount of crude oil production, Alaska State is entering the businesses related to the marketing of petrol-related products like jellies. The main reason for joining this business is that the production of these products is more, but the marketing techniques are not applied efficiently. That is why people are now coming up with new ideas for marketing petroleum products. Also, if you should have a better idea, the funds don’t matter much.
Some small business opportunities that one can also consider are:-
· Restaurant Business
· Tutoring Services
· Digital Printing Services
· Cake Shop Business
Alaska LLC Formation Review
Time needed: 1 hour and 5 minutes.
Just to recap, here are the easy steps again when forming an LLC in Alaska. Click on the steps in this list to read the full detail.
- Name your Alaska LLC
The first thing you must do is to choose a company name, which should include the phrase “limited liability company,” or one of its abbreviations (LLC or L.L.C.).
- Choose a registered agent
In Alaska, it is mandatory to select a registered agent for your LLC. You can check out our list of our 5 Best LLC Services in the United States.
- File a formation certificate
Filing a formation certificate is necessary when forming an LLC. Depending on the state, it could be called any of the following: Certificate of Formation, Articles of Organization, or Certificate of Organization.
- Create operating agreement
A company operating agreement is not a strict requirement but something encouraged when you start an Alaska LLC.
- Get an EIN
The Employer Identification Number (EIN), also called Federal Tax Identification Number, serves to identify a business entity like a social security number but for a company.
A “domestic LLC” is one that conducts business in a state where it was formed. Meanwhile, a “foreign LLC” is an existing LLC that extended business to another state.
For Domestic LLCs, it is vital to have a Certificate of Name Reservation and Certificate of Formation. For the foreign LLCs, you must have a Certificate of Good Standing.
The cost to form an LLC varies per state.
Seldom do L.L.C.s use D.B.A. or a ‘Doing Business As’ name nor a fictitious business name. However, if you want to have one, you make read more about DBAs here.
This document is vital as it ensures that all business owners are on the same page regarding how they operate, thus reducing future conflicts.
>Your name should have “L.L.C. or LLC” or the phrase “limited liability the business.”
>Do not include words that could create confusion between your LLC and any government business.
>Words like ‘bank, attorney, university’ are restricted as well.
>Lastly, your name should distinguish from other limited liability corporations, limited partnerships, or registered limited liability partnerships.
Typically, you can file your LLC name online or by mail. Check with the state where you will set up your LLC name. Take note that the fees for business names may also vary per state.
As for a website and your URL name, check if your name is still available for URL use with NameCheap to see if your name is available as a web domain. Even if you don’t have plans to set up a website today, it will help if you buy a URL. Buying it can help to prevent others from getting your name; check out WPEngine, Kinsta, and GoDaddy for hosting and building your website.
No. Never mail these documents or payments to the Secretary of State directly.
The reason you might need an E.I.N. is that it would help for three reasons:
>Opening a business bank account
>Filing and managing federal and state taxes
>Hiring employees or agents
You are not required a Social Security number when getting an EIN. You can proceed to fill out I.R.S. Form SS-4 and leave section 7b blank. You must then call the IRS at (267) 941-1099 to complete your application. Agents or employees will help you with that.
International EIN applicants do not need an SSN to get an EIN.
The filing fee for your Alaska LLC Articles of Organization is $250. A Registered Agent must be a resident of Alaska or a corporation, such as a registered agent service , authorized to transact business in Alaska. The Registered Agent ensures proper service of process, also known as a notice of litigation.
Since there is no personal income tax in Alaska and LLCs by default receive pass-through taxation, the LLC does not pay income tax either. Pass-through taxation means the business itself does not pay taxes.
A registered agent service ensures that your annual reports and other forms are filed efficiently and on-time, saving you from the penalties of delinquent filings and the stress of having to do it yourself. LLC owners report business income and losses on their personal tax returns.The physical street address and the mailing address may be the same, and if so, fill out both fields. Ask us about government Agency, business activity, business credit cards,Liability Insurance, Limited Liability Protections, Tax documents, Formation Documents, Professional licensing, Individual tax returns, Income tax return, Sales Tax Rate, Pass-Through Entity, paper submissions or anything from the article in the comment box.