Nevada citizens and businesses pay some of the lowest State taxes in the country. According to the Tax Foundation’s Business Tax Climate Index, 2020, Nevada has ranked the seventh best State. If you are someone looking to start your business journey in the State, then the first step would be for you to select a business structure.
A Limited Liability Company (LLC) can be an excellent choice for the business you are trying to form. It protects your personal assets from legal liability and, at the same time, gives you great operational flexibility.
Nevada has its own set of rules and regulations; if not done carefully, you could risk repeating the procedure. This would mean lost time and money in non-refundable fees. Let us go through the process of forming an LLC in Nevada, and make sure you are well informed and ready to set up your company in the State!
Naming Your Nevada LLC
Your LLC’s name will be the identity of your business. Potential customers, as well as the State of Nevada, will identify your LLC using the name you select. Naming your LLC is also the first step in setting up your business.
The state of Nevada has some specific regulations that guide you on how to choose a name for your LLC. Be sure to follow these guidelines while naming your company.
§86.171 of the Nevada Revised Statutes lays down the guidelines for naming your LLC.
The name should include any of the following words or phrases: “Limited-Liability Company,” “Limited Liability Company,” “Limited Company,” or “Limited” or the abbreviations “Ltd.,” “L.L.C.,” “L.C.,” “LLC” or “LC.”
The name must be distinct from the names of all artificial persons, i.e., organizations and entities registered with the State of Nevada.
The title you propose should not imply that it is the same as another entity already registered with the State. Distinctiveness must be very evident, which means that simply using words such as “and,” “or,” “a,” “an,” “the,” and so on with an already existing name won’t help you in getting your name registered.
Misspelling the terms with different spellings, distinctive lettering, a distinctive mark, etc., would also disqualify you.
In Nevada, certain restrictions are imposed for naming your LLC to ensure that your LLC’s distinctive features are identifiable. For example, names cannot include words like “accountant,” “accounting,” “auditor,” or “auditing,” and “insurance,” or “indemnity” unless certified by the Nevada State Board of Accountancy and the Commissioner of Insurance consent, respectively.
Similarly, you are prohibited from using words and phrases like police, army, federal reserve, etc. These restrictions are imposed because usage of such words can imply that your business is affiliated with a State Agency.
It would help if you looked at Nevada’s exhaustive list of restricted words before finalizing a name for your LLC.
Does Your Business Require a DBA?
A Doing Business As Certificate (DBA), also referred to as a fictitious name in Nevada, allows your LLC to carry out its business under a name other than its original legal name.
For example, Puma’s original name is Ruda (named after its founder Rudolf Dassler). All the rules applicable to the name selection also apply to DBA, except the mandatory inclusion of words and phrases indicating LLC like a limited company, limited liability company, etc.
A fictitious name is best used for branding purposes, especially when you want to expand your business to new markets and include new products in your existing portfolio. But remember that the trade name alone does not protect your personal assets. To avail of the protection of limited liability, you need to form an LLC.
In Nevada, you have to apply with your respective county clerk’s office to have your FBA name registered.
Access Your LLC’s County Clerk and ApplyApply through your county
Fee: Usually $25, check with your LLC’s County
Doing a Name Search and Name Reservation
Before finalizing a name for your LLC, you must ensure that the name you selected is not similar to an existing business. You can use the State’s Business Entity Search portal to see if the name you have picked is available for use.
If you have selected a name but do not wish to form the LLC immediately, you can reserve the name for 90 days. There is also an option to renew your reservation after the expiry of 90 days.
Option 1: Reserve a Name Onlineapply online – OR –
Option 2: Reserve a Name by MailDownload form
Secretary of State
202 North Carson Street
Carson City, Nevada 89701-4201
Registering Your Business Domain
Registering a business domain for your LLC will enable you to take it online with a website. You can register a domain name now, so you do not miss out on it, even if you plan to take your LLC online at a later stage.
You can check currently available domain names.
Choose a Registered Agent in Nevada
A registered agent in Nevada is an individual or business entity that serves as the primary “point of contact” between the Secretary of State and your LLC. As your LLC’s agent, they ensure that you don’t fail to duly respond to any notice or other communication that may be sent to your LLC by the State authorities.
The registered agent shall also receive any process service concerning a lawsuit against your company. Nevada law mandates that your company have a registered agent.
Who Can Be a Registered Agent?
The agent you select for your LLC must be:
- An individual State resident (above 18 years) or
- A business entity that has obtained authorization to conduct business in the State.
The registered agent should be available during business hours on all working days.
Individual v. Registered Agent Service
Though you can appoint yourself as the registered agent of your LLC, having a registered agent service is advisable. A registered agent must be particularly vigilant about deadlines and filings because missing them can cost you a lot of money, and your standing in the state records will suffer. Registered agent services are dedicated to making sure this does not happen.
They are entities established solely for this reason; therefore, they exercise utmost diligence in carrying out their duties. They remind you when your returns and other filings are due and help ensure you don’t miss any deadlines. Also, the registered agent’s address is available for the public to access on the concerned websites. So if you work out of your home or a private office, having a professional registered agent service will help you maintain privacy.
If you wish to expand your LLC’s business into other states, your registered agent service can be valuable in aiding the process. Most commercial registered agents have a presence in multiple states.
Filing the Articles of Organization with Nevada
The Articles of Organization is a legal document that establishes your LLC and gives it legal status. You must file Articles of Organization in Nevada to form a limited liability company. It is to be filed with the office of the Secretary of State. Once this is completed, your LLC is registered and is recognized in the eyes of the law.
Along with filing articles of organization, the state requires you to file the initial list of managers, the State business license application, and the certificate of acceptance by the registered agent.
The state provides a single form to file all of these documents. The forms should include the following details:
- Name of the LLC.
- Nature of the LLC’s business.
- Details on all the members of the LLC.
- Name and address of the registered agent.
- Dissolution date if the LLC has to be dissolved on a particular date and to be left blank if the LLC is to exist perpetually.
- Nature of management: This is the stage in your LLC creation where you have to decide whether it will be Manager-managed (managed by an employee) or Member-managed (managed by one of, or all, the owners).
Option 1: File Articles of Organization OnlineFile online – OR –
Option 2: File Articles of Organization by MailDownload form
Secretary of State
202 Commercial Recordings Division
202 N. Carson St.
Carson City, NV 89701-4201
Fax: (775) 684-5725
Fee: $425 in total = $75 for your Articles of Organization + $150 for the Initial List of Manager or Members + $200 for a Business License Application
Nevada provides 3 expedited service options: 24 hours, 2 hours, and 1 hour. For 24-hour expedited service, the fee ranges from $75-$125. For 2 hours services, the additional fee charged is $500, and for 1-hour services, the additional fee is $1000.
The address for expedited application filing is Secretary of State – Las Vegas North Las Vegas City Hall 2250 North Las Vegas Blvd, 4th Floor North Las Vegas, NV 89030.
Publish Notice of Formation
Nevada does not mandate LLCs to publish a notice of formation.
Create an Operating Agreement for Your Nevada LLC
An operating agreement is a document that outlines the inner workings of your LLC. It also provides a framework concerning the duties of members of the LLC and its managers. An operating agreement acts as a guiding force in matters of the day-to-day functioning of the LLC.
In owning a business, you might get into conflicts with your fellow owners regarding various aspects of the functioning of your LLC. An operating agreement helps you avoid such disputes. Like most other States, the state of Nevada does not require you to file an operating agreement, but it is always a good practice to draft one to avoid internal conflicts.
There are no prescribed templates for an operating agreement, and you may draft one according to the needs of your business. However, irrespective of the nature of your business, it shall be advisable for your operating agreement to cover the following matters:
- Organization Details
- Duties of Members and Managers
- Management and Voting
- Capital Contributions
- Division of Profit and Losses
- Bookkeeping Procedures
- Procedure for adding new members
- Requirements concerning Meetings and Procedures thereof
The State of Nevada has particular regulations that apply to the governance of all LLCs. These provisions apply to your LLC in the absence of an operating agreement. They are stated under Section 86.286.
Writing The Operating Agreement Yourself v. Hiring a Service
An operating agreement can be as detailed as you want and can be either drafted by you or through a professional like an attorney. You may also purchase templates that you can customize to draft the operating agreement of your LLC.
However, it is recommended that you seek the help of an attorney or a professional in preparing your operating agreement. Experts in the laws of Nevada, these attorneys or professionals will help you draft an operating agreement that suits the needs specific to your business model.
Limits of Operating Agreement
There is no fixed format for this agreement. You are at liberty to draft an operating agreement with provisions that you deem fit for your business model. However, you cannot circumvent the law using your operating agreement. Therefore, you cannot include provisions that are banned by law in your agreement.
Obtaining an EIN for your Nevada LLC
EIN (Employer Identification Number or Federal Identification Numbers or FEINs) is an identification number allotted by the IRS. It is a nine-digit number used to identify an operating business entity for taxation purposes. You can think of it as your LLCs social security number. It is a requirement for any organization that wants to hire employees.
You will need an EIN to create a business bank account, apply for business permits, and to file your tax returns as a business owner. The IRS issues an EIN, and you can apply for it online or through the mail.
Option 1: Request an EIN from the IRSApply online – OR –
Option 2: Apply for an EIN by Mail or FaxDownload form
Internal Revenue Service
Attn: EIN Operation
Cincinnati, OH 45999
Fax: (855) 641-6935
File Annual Reports in Nevada
An annual report is a document used by the authorities to get the latest and updated information about all the business entities operating in the State. In Nevada, all companies must produce an annual report known as an “annual list.” The document includes a list of your LLC’s members and employees.
The annual list also includes administrative details about your LLC, such as the name, address, management, and updates made to the same.
As per §86.263, the first filing of the annual list should be done on or before the end of the month in which you have filed your articles of organization. Every subsequent year, you will be required to file this list by the last day of your LLC’s formation anniversary.
For example, if you formed your LLC on the 12th of October 2020, you will have to file the initial list by the 31st of October 2020 and every subsequent year by the end of October. In Nevada, you can file annual reports online using Nevada’s SilverFlume portal.
You may also download the form and file it via mail to: The Secretary of State, 202 North Carson Street, Carson City, NV 89701. The fee is $150 (Non-refundable).
If you do not meet the deadlines, you incur a late fee of $75. If you fail to file the document for more than a year from the due date, you also risk getting shut down by the State authorities.
Tax Liability For Your Nevada LLC
The way your LLC will be taxed depends upon the number of members in your LLC. There are four ways in which LLC will be taxed:
- Sole proprietorship: a business owned by a single person
- Partnership: a business owned by multiple people
- C – Corporation: income is split or segregated for taxation
- S – Corporation: tax liability is split between the business and its owners
Federal Tax Liability
Federal tax liability is fixed and dealt with by the IRS ( Internal Revenue Service). The IRS does not have a specific taxation structure for LLCs. Depending on the number of members and how your treat your LLC for taxation purposes, your federal tax responsibilities will also vary.
If you’re a single-member LLC, you will file your taxes as a sole proprietor or ‘disregarded entity.’ The LLC has to report its activities under Schedule C, Schedule E and/or Schedule F of Form 1040.
If your LLC has more than one member, you will file your taxes as a ‘partnership.’ Apart from filing Form 1040, you’ll have to file your partnership return in Form 1065 and provide information under Schedule K-1 for each partner.
If you would like your LLC to be taxed like a C-Corp or S-Corp, file your taxes under Form 8832 and Form 2553, respectively.
State Tax Liability
In Nevada, if your business sells physical products, you will have to register for a seller’s permit. A seller’s permit allows you to collect sales tax from the consumers and pass it on to the government.
Goods like physical property, furniture, home appliances, etc., fall under the purview of the sales tax. However, there are certain exemptions as well, like prescription medicines, gasoline, and groceries.
If needed, apply for your seller’s permit. There is no fee for application and no expiry period. If you are a business that purchases goods for resale, you are not required to pay the sales tax as long as you show a resale certificate.
Nevada follows a destination-based tax system where the tax is calculated based on the location of the buyer. Therefore, the tax applicable would be based on the county and district taxes applicable to the buyer in addition to the Nevada rates.
The State offers you an online tax portal, making it easier for you to file your taxes. If your firm collects sales tax of less than $1500 per month, you should file the return annually. You should file the return quarterly if you collect tax between $1500 and $10000 per month. If you collect more than $10000 per month, you should file your return monthly.
For annual filing, the deadline is 31st January of the following year. The deadlines for quarterly filings are 30th April, 31st July, 31nd October, and 31st January for the previous quarters, respectively. For monthly filing, the due date is the last date of the following month. Missing the deadline will result in the levy of a penalty by the State.
Miscellaneous Tax Liability
If you’re an employer, you must register for Unemployment Insurance Tax with the Department of Labor and Industrial Relations. You will also need to register for Employer Tax on your employees’ behalf.
If your LLC pays $50,000 in wages quarterly, you are required to pay Modified Business Tax. LLCs with gross annual income above $4,000,000 are required to pay Commerce Tax.
Permits & Licenses
Depending on the nature of your business and the location, you might be required to register for specific permits and licenses. These licenses range from the federal, state, the county level.
Federal Licensing requirements will depend on the business activity carried on by your LLC. If your company is engaged in any area of business regulated by the Federal Government, you will be required to obtain relevant Federal Licenses and Permits.
Some business activities requiring Federal Licenses and Permits are:
- Alcoholic beverages
- Firearms, ammunition, and explosives
- Fish and wildlife
- Commercial fisheries
- Maritime transportation
- Mining and drilling
- Nuclear energy
- Radio and television broadcasting
- Transportation and logistics.
At the State level, most businesses are required to obtain a license. There are certain exceptions. You may apply for your LLC’s business license online using State’s SilverFlume website.
You can also download the form and file it via mail to Secretary of State Commercial Recordings Division North Las Vegas City Hall, 2250 Las Vegas Blvd. North, Suite 400. Or, fill it with Secretary of State Commercial Recordings Division North Las Vegas City Hall 2250 Las Vegas Blvd. North, 1st Floor, North Las Vegas, NV 89030. The filing fee is $200, excluding the formation fees.
In Nevada, you are required to renew your business license annually. You can do this online using State’s SilverFlume website or submit a duly filled Annual or Amended List and State Business License Application by mail.
Apart from a business license, your LLC may also need to obtain a seller’s permit if you plan on selling products subject to sales tax. You can obtain the seller’s permit using the State’s SilverFlume website.
In Las Vegas, most businesses, including home-based businesses, must have a specific city license. Depending on where you operate your business, you may also be required to get the local government’s license and permit. To know more about local licensing requirements, get in touch with the office of your town or county government.
For more information regarding;
Business Bank Account & Phone Number
A business bank account is a separate account for your LLC. When you open a business account, your bank will ask for your LLC’s EIN and other information. You would not want your personal assets attached to any debts recovered from your LLC. The calculation of taxes becomes more manageable as well.
Most network providers offer virtual numbers and business/enterprise plans; you can choose whichever fits your LLC best. A business phone number is a customer’s first point of contact with your LLC.
Having a separate phone number will enable you to be flexible with your active hours. Another option is to have a virtual number that records voicemails for you and forwards calls based on specific criteria to your personal number.
Nevada has various grants and incentive programs, such as the National Association for the Self Employed (NASE) and the Small Business Innovation Research and Small Business Technology Transfer (STTR), which aims to help small enterprises.
Get in touch with your local county or city government office to determine if your LLC is eligible for any of these incentives.
On completing the above steps, your LLC is legally incorporated and ready to do business. Make sure you meet your Annual List and Business License Renewal deadlines so that you do not risk your LLC being involuntarily dissolved by Nevada.
Best of luck to you and your LLC!