Step 1) Verify & Secure Your LLC Name
The first step in forming an Alaska LLC is choosing a great business name. Choosing a memorable name that hasn’t been taken by another business in Alaska isn’t only necessary for legal purposes, but for branding too. If your name sounds too similar to an existing business, people will have difficulty differentiating between you and your competition.
Legally, Alaska requires your LLC name to:
- Be “distinguishable” from any other business name on record with the state. They outline exactly what this means here.
- Contain the abbreviation “LLC” or the words “Limited Liability Company” (“Limited” and “Company” may be abbreviated to “Ltd.” and “Co.”)
- Be free of any name restrictions. Your Alaska business name can’t imply that your LLC is a governmental unit, mislead about your corporate purpose, or contain any vulgarities.
What To Do:
Conduct a business name search through the Alaska Department of Commerce. Their website isn’t the easiest to navigate, so we recommend bookmarking the link above rather than trying to hunt it down on your own.
While you’re at it, search for a domain name on GoDaddy to make sure there’s a decent URL available for your business. Having an easy-to-find business website will be extremely beneficial to your brand, so don’t overlook this part just because “launch a website” isn’t the first thing on your to-do list.
Once you’ve established that your business name is available, or modified it enough to make it distinguishable, you can either reserve the name or hustle on through to the formation phase. Alaska doesn’t require business name reservations, so this all depends on how close you are to being ready to form your LLC. If you need some extra time to get all your ducks in a row, you might want to pay the $25.00 to reserve your business name for 120 days.
Remember, this isn’t optional in Alaska-- it’s mandatory.
Quick Note: Before you commit 100% to a name, you may also want to check that there’s a decent URL available for your business. Use Weebly to search your options. If there’s a quality domain name for purchase, we advise buying it right away. Even if launching a business website isn’t on your radar right now, it’s going to be soon, and you might as well nail down a domain name that’ll make it easy for customers to find you!
Step 2) Appoint An Alaska Registered Agent
Before officially forming an LLC in Alaska, you’ll need to decide on a registered agent. Your registered agent’s name and address will be requested on your Articles of Organization, so you won’t get far without knowing these details.
Alaska does not prohibit business owners from acting as their own registered agents, but we encourage you to consider the following before you sign up for the task:
- You’ll be responsible for maintaining normal business hours (9 am to 5 pm) at your address.
- If you run your business from home, you’ll have to make your home address public.
- It’s possible that you’ll be served in front of coworkers, customers or family.
It’s our professional opinion that appointing a professional registered agent is in your best interest, if only to be certain that no important legal documents go missing or unnoticed. Your Alaska registered agent can be an individual who’s a resident of the state, or a company that’s authorized to represent Alaska businesses.
What To Do:
First, if you’re leaning toward representing yourself, check out our registered agent guide for a closer look at the duties involved. If it sounds like something that will work seamlessly with your lifestyle, then by all means, sign yourself up!
Otherwise, the easiest and cheapest way to get professional registered agent services is through an online filing company. Some providers, like IncFile, offer these services for free when you form your LLC with them.
Step 3) File Articles Of Organization
A very exciting step indeed -- once you’re through filing your Articles of Organization, you’ll be a legitimate business in Alaska! But let’s not get ahead of ourselves, here are the details of what this document requires:
- The full name of your business
- Your business’ purpose and NAICS code (find yours here)
- Your registered agent’s full name, physical address and mailing address (must be in Alaska)
- A description of your company’s management
- Name and signature of organizer(s)
- A $250.00 filing fee
If you choose to do this in hard copy, you’ll mail the completed document and $250.00 check to the following address:
State of Alaska, Corporations Section
PO Box 110806
Juneau, AK 99811-0806
Alternatively, Alaska also accommodates online filing, as long as you can pay with Visa or Mastercard. Learn more here.
What To Do:
Sure, you can handle this step on your own, but we still recommend considering the help of an LLC formation service. Why? Not only will they take the reins and make sure your Articles of Organization are filed perfectly, they’ll also provide other necessary products and services at super competitive prices.
Take a look at our top 7 business filing services to find out about various providers’ pricing and features.
Quick Note: Once you’re through with your Articles of Organization, keep it on your agenda to file an initial report within 6 months of your business’ formation. While your online filing provider may notify you, it’s up to you to take care of filing the report on your own (but don’t worry, it’s free).
Step 4) Get An EIN
An EIN, or Employer Identification Number, is the federal government’s way of tracking your business’ activity -- it’s basically like a corporate social security number. Obtaining an EIN is fairly easy, but before you apply let’s make sure you actually need one. Your LLC is required to have an EIN if:
- You plan to hire employees
- Your business has more than one member (i.e. you’re not starting a single-member LLC)
- You plan to be taxed as a corporation
Refer to this IRS page for other specific conditions that require an EIN.
What To Do:
There are a few ways to go about obtaining your EIN, but our recommendation is to simply do it yourself through the IRS. Their free online application is the most efficient method, as you’ll get your 9-digit identification number as soon as you’re done filling it out.
However, if the online approach doesn’t suit you, check out our guide for other ways to get an EIN for free.
Step 5) Draft An Operating Agreement
If you’re the only member of your LLC, you can move right along to step 6.
However, if you’re working with partners, listen up -- having an operating agreement in place is the best way to avoid disputes and maintain control of your business in the face of issues.
While it’s not a legal requirement in Alaska, it’s wise to have a written document that outlines:
- Each member’s title and responsibilities
- The company’s profit and loss distribution
- What percentage of the company each member owns
- What will happen if a member chooses to leave
…and some other logistical details about your business.
What To Do:
Our two favorite approaches to creating an operating agreement are as follows:
- Add a customized operating agreement to your online incorporation package. If you’re already using/planning to use an LLC filing service, this might be the easiest way for you to draft a customized operating agreement.
- Use an online operating agreement template. While most of these services charge a monthly fee, some of them offer free trials that last long enough for you and your partners to create a document you can all agree on. Check out our top 3 LLC operating agreement templates for our recommendations.
Step 6) Open A Business Checking Account
Whether you’re starting a single-member or multi-member LLC, it’s vitally important to keep your personal and business finances completely separate. Otherwise,
- You’ll find yourself in a mess of trouble when tax time rolls around
- Your personal assets may be put at risk
- You won’t be able to take advantage of business banking perks
Opening a bank account designated for business expenses is a necessary first step to smart financial management.
What To Do:
Depending on your location, you can shop around local banks like Northrim and Denali State, and federal credit unions like Alaska USA. Few national banks operate in Alaska, but our favorite that does is Wells Fargo.
Before you commit to any business bank account, make sure you fully understand all the details. Think about what your business’ top priorities are: online banking, easy ATM access, customer service, fee structure, etc. To get started on your research, read our Wells Fargo review or take a look at this comprehensive list of Alaska banks and credit unions.
Step 7) Handle Licensing & Tax Obligations
Acquiring a general business license and any special permits required of your LLC are the final bits of red tape you need to cut through -- after this, you can turn your full attention to building and marketing your brand!
When it comes to permits and licenses, remember to consider federal, state and local requirements:
- Federal: For a list of the business activities that require special licenses, head over to the Small Business Association. They also have a short article on business taxes, although the IRS website is the best resource for detailed federal tax requirements.
- State: You can find out about various Alaska business taxes and apply for a general business license through the Department of Commerce website. For other special requirements, run your eye over their business licensing page.
- Local: Depending on the borough or city in which you’re running your business, you may be required to adhere to other special requirements. To be totally sure you’re not missing anything, contact your local Chamber of Commerce.
What To Do:
If all you need is a general business license, go ahead and apply on your own.
However, if your business activity/location requires you to get quite a few permits and licenses, you may want to consider using a business license research service. These companies will do all the research on federal, state, and local business requirements on your behalf, and send the necessary applications right to your doorstep (or inbox).
Need Help Forming an LLC?
If you’ve got the time and the business-savvy, you may be able to handle the Alaska LLC formation process on your own.
However, many business owners in Alaska opt for professional assistance to make sure everything goes as planned. Here are three reliable services that we have reviewed and recommend:
– IncFile ($49 + state fee) = Best Price & Overall Value
– LegalZoom ($79 + state fee) = Best For Brand Recognition