How to Start an Alabama LLC
To start an LLC in Alabama, you’ll need to formally reserve your business name with the state ahead of filing for formation. Once your LLC is set up, watch out for the mandatory Business Privilege Tax required within two and half months of formation. You’ll need to continue filing annual reports yearly when you do your taxes.
If you’re feeling overwhelmed about starting your dream business, don’t worry — we have your back. Check out our full guide for LLC formation below. And if you decide you want help, we have dedicated local experts you can rely on.
See how to tackle formation all on your own in our Do-It-Yourself Guide for Alabama LLCs. Or avoid the hassle and do it all (and more) in one easy step with us for only $386 (which includes the state fees).
Plus, you’ll get:
- Access to additional services and filings (EIN application, DBA) including free business documents, annual report reminders, and lifetime client support
- Formation paperwork filed AND state filing fees covered
- Alabama Business Identity service, including domain, website, SSL security, email, and phone
- A year of registered agent service (just $49/year after the first year)
- Business mail scanning
Do-It-Yourself Alabama LLC Guide
“Arnold is extremely helpful he has helped us straighten out and streamline our registrations across several states and has freed me up to focus on our business!”
⭐⭐⭐⭐⭐
— Zac Fagan, Google Review
“I just signed up with ARA and my experience was more than I expected. Customer service is #1 especially Cleo. She is the best in my opinion. ~ :)”
⭐⭐⭐⭐⭐
— Pamela Smith, Google Review
Why Choose Us to Form Your LLC?
We jump through the hoops so you don’t have to. And we offer a lot more than collecting mail.
Increased Privacy
Because our LLC Formation Package includes our Registered Agent Service, you can use our address on your Certificate of Formation which will keep yours off the public record.
Local Expertise
Because our LLC Formation Package includes our Registered Agent Service, you can use our address on your Certificate of Formation which will keep yours off the public record.
Registered Agent
You’ll receive a full year of Alabama Registered Agent Service with a secure online account. That way, in the unlikely even you get sued, no one will come knocking on your door.
Ops Agreement
Many new business owners don’t realize the value of having a clear operating agreement until it’s too late leaving them vulnerable to state defaults. That’s why we provide free LLC operating agreement templates for single- and multi-member LLCs.
Renewal Service
We also enroll you in our Renewal Service for Annual Report filing so you never miss an Annual List filing. This ensures your LLC doesn’t fall into non-compliance with the state and face dissolution, letting you focus on your business.
Business Identity
In addition, we provide a 90-day trial of our website, phone service, and setup assistance to get online fast because we know you want to get to business, not waste months setting up your Business Identity services.
Transparent Pricing
Compare our pricing to our national competitors. They often reel you in with low up front pricing while charging more for unadvertised essential services. We offer lower prices because we want to partner with you for the long run.
| Service | Us | National Competitors |
Alabama State Fees |
$236 |
$236 |
Filing Fee |
$100 |
$0 – $99 |
|
One Year of Registered Agent Service |
$49 |
$199 – $249 |
|
Total |
$385 |
$435 – $584 |
Do-It-Yourself Alabama LLC Guide
Filing on your own? We’ve still got you covered with our step-by-step instructions for how to form and maintain an LLC in Alabama.
1. Bookmark this Guide
Make sure to bookmark this page so you have an easy reference point to return to (just drag this link to your bookmarks bar).
2. Name Your LLC
The name of your LLC must be distinguishable from any other legal business entity registered in Alabama. The name must also include the words “Limited Liability Company” or the abbreviation “LLC” (with or without the punctuation). Once you have reserved your name, you must form a company under that name within one year of the reservation or your certificate for the name will expire. Once you register your business, your certificate will not expire.
You should check to make sure that the name you want is available by searching Alabama Secretary of State Business Entity Records. It’s also a great idea to search for your name in a search engine and check the US Patent and Trademark Office to make sure no one else is already using it elsewhere.
There are also a few words that cannot be used in Alabama without taking extra steps:
- Bank, trust, insurance: Requires an approval letter from the Alabama State Banking Department or the Alabama Department of Insurance.
- Doctor, attorney, engineer, architect, landscaping (for example): Any name using a professional designation requires a copy of a license from Alabama or a letter from the governing agency overseeing the profession giving permission to use the title.
- Any name using one of the above words can’t be completed online and must be mailed with your documentation attached.
Your LLC must have a unique name to Alabama or your Certificate of Name Reservation will be rejected.
3. Complete Your Certificate of Name Reservation
In Alabama you must submit a Certificate of Name Reservation prior to filing your Certificate of Formation (§10A-1-5.11).
You’ll need to provide the following details:
- Type of business entity
- Name of company requested
- Name and address of the requester
- Where the filed certificate should be mailed
- Payment information
You can file online for $28 and get your name approved instantly using the Alabama Secretary of State Online Services website.
Or, if you’re old school, you can file by mail for $25, though approval time varies. If you’re really old school, you can even walk it in and drop it off by hand! You can download and print a copy of the form Alabama Secretary of State Name Reservation Request Form for Domestic Entities website and send it to:
Office of the Secretary of State
PO Box 5616
Montgomery, AL 36103
4. Appoint a Registered Agent
All LLCs formed in Alabama *must list* a registered agent who meets two key criteria:
- Holds a physical address in Alabama (PO boxes don’t count)
- Is available during regular business hours all year long
Your registered agent receives all official and legal notices on behalf of your LLC—including service of legal process—from the Alabama Secretary of State’s office. So, if you fail to maintain a registered agent, your LLC could be administratively dissolved by the state.
You can also be your own registered agent, but be aware you are signing up to receive any service of process (including lawsuit notifications) to your business address during standard operating hours. So if you’re traveling, working remotely, or just away from your office this could create complications for you.
Why hire a registered agent?
Even though you can serve as your own registered agent, many business leaders choose not to. For your privacy, schedule, and to avoid the possibility of being served a lawsuit in front of clients and employees, hiring a registered makes sense. And if you decide to partner with us for that, we can do a whole lot more than document processing to help your LLC get rolling.
5. File Your Certificate of Formation
To make your LLC official, you’ll need to submit a Certificate of Formation with the Alabama Secretary of State. The fee is $208 online.
The Certificate of Formation requires the following information:
- The name of the LLC
- A copy of the Name Reservation Certificate (if filing by mail)
- The name and address of the registered agent
- Signature of the organizer (the person(s) authorized to file your document)
Like your Certificate of Name Reservation, this can be done online or by mail. By mail, the fee is $200.
To file online, visit the Alabama Secretary of State Online Services website.
To download a copy of the Certificate to file by mail, go to the Alabama Secretary of State Business Downloads website. If you mail your Certificate, be aware that this form must be typed. If it is handwritten, it will be rejected. You’ll need to enclose a copy of your Certificate of Name Reservation. This is not necessary if you file online.
6. Draft and Finalize an Operating Agreement
For Alabama LLC’s an operating agreement isn’t required. But it’s still smart business.
Your operating agreement outlines how your business will function, including:
- The rights and responsibilities of members and managers
- The management structure
- How ownership interest is distributed
- How to become a member
- What happens if a member dies
- What happens if you and the other founders die
These details can become essential if your LLC ends up in court. Without your own Operating Agreement, your business will be subjected to the default Alabama LLC statutes. These default laws may not serve your company’s best interest. It’s smart to preemptively outline the rules and regulations of your LLC—just in case.
Our LLC formation service includes a FREE attorney-drafted operating agreement. This can help you avoid paying a lawyer to write one for you. If you’re ready to create an operating agreement, you can get started using our form below.
7. Obtain an EIN
An Employer Identification Number (EIN) is a unique nine-digit number issued by the Internal Revenue Service. It’s required for business in order to complete most financial transactions including:
- opening a business banking account
- processing many kinds of transactions
- hiring employees
- preventing fraud as it reduces your reliance on your personal Social Security number while conducting business
The good news is the process is simple and free. Visit the IRS website to apply.
If you’d like, we’d be happy to file for you. EIN applications are available with our LLC formation package.
8. Apply for Any Necessary Business Permits or Licenses
Business licenses and permit requirements vary by profession and jurisdiction in Alabama. It’s a good idea to check and see which ones you will need to operate. Start by consulting the Alabama Department of Labor: Labor Marketing Information Division Career Resource where you can find an in depth list of all occupations that require licensing and what governing body you need to work with to obtain a license or permit.
9. File Your Annual Report and Tax Returns
Now that your LLC is up and running, your last task is to stay compliant. That means completing all relevant reporting and tax payments on time each year.
- In Alabama, all LLCs must file a Business Privilege Tax return (§40-14A-21 through §40-14A-29), which serves as your annual report (commonly referred to as “Form PPT“).
- During your first year as a business, you’ll also need to file an initial tax return two and a half months after the company formation (which uses a different form, “Form BPT-IN).
After that, annual reports and tax returns are due annually on March 15th.
You can find these forms on the Alabama Department of Revenue Forms site. Both reports require a minimum payment of $50.
FAQs
How do I start an LLC in Alabama?
To start an LLC in Alabama, you must reserve your LLC’s name, choose a registered agent, and file your Certificate of Formation, file and annual report and pay the Business Privilege Tax. It’s also smart to create an operating agreement, get an EIN, and create a website. Our guide above lays out everything you’re required to do to start and keep your Alabama LLC.
If I hire you to form my LLC, do you have any control over my company?
None at all. If Alabama Registered Agent LLC files your formation paperwork, we may be listed as your LLC organizer for privacy reasons. Being listed as an organizer does not give us any ownership, control, or decision making power in your company.
Does Alabama require a name reservation before forming an LLC?
All LLCs must file a Certificate of Name Reservation before submitting your Certificate of Formation. If you are ready to form your LLC, the Certificate of Name Reservation is included in the online application with Secretary of State.
Will you file both my Certificate of Name Reservation and Formation?
If you form your LLC with us, we will handle both the Certificate of Name Reservation and Certificate of Formation on your behalf.
Can I order LLC formation without registered agent service?
Our LLC formation always includes registered agent service. Also, as your registered agent, we can better support your business while protecting your privacy. By partnering with us, you also unlock services for your website, email, phone service and receive reminders to stay in compliance. We’re here to set you up to succeed.
How long does it take for LLC applications to be approved in Alabama?
A few business days for online filings. Mail filings may take longer.
Is a website really necessary?
Not legally for most businesses. You certainly can form your LLC without a website. But in today’s world, most businesses need one to thrive, though no one’s going to force you to have one.
It’s relatively inexpensive and can be crucial for finding new clients. Your website doesn’t just have to be simply informational, it’s also can serve as storefront where you can transact orders and interact with customers.
When you start a business with us, we give you a domain name and website right away. Your domain name is free for the first year (up top a $25 value), then it’s subject to market prices. And your website, email, SSL security, and phone number are each free for 90 days, then $9 after that. We offer the easiest and most affordable way to get your business online right away.
Do I need an operating agreement to form an LLC in Alabama?
Alabama does not list an operating agreement as a legal requirement, but any good business person will highly recommend you create one. Operating agreements protect all members of your LLC, clarify ownership, and avoid the default state rules if any legal challenges arise.
Can I talk to a real person at your office?
Of course! Call our local office at (205) 383-1667 to speak with a real person.