Starting an LLC in Vermont is Easy
You can start a Vermont LLC online by registering the Articles of Organization with the Secretary of State. The cost to create an LLC in Vermont is $125.
Follow our How to Start an LLC in Vermont guide below to get started.
To learn how to form an LLC in any state, visit our How to Start an LLC guide.
Step 1: Create A Name For Your Vermont LLC
Before you register your Vermont LLC, you'll need to come up with a name. Your business name needs to be catchy for branding purposes and legitimate for legal purposes.
We go into depth on this topic in our LLC naming guide. We’ll go over the basics below.
Naming Your LLC
First, brainstorm some possibilities. Use our LLC name generator to get the ideas flowing.
Next, make sure your name meets Vermont guidelines:
- it contains the words limited liability company, limited company, LLC, or L.L.C.
- it doesn't contain restricted words or phrases (these often include words like bank, attorney, and university) without approval
- it's distinguishable from any other entity or trade name registered in Vermont
- full list of Vermont naming guidelines
Next, do a Vermont LLC name search with the Secretary of State to find out if your name is available in Vermont.
If your business name is available and meets guidelines, you’ll be able to register it when you file your Articles of Organization with the Secretary of State.
Is the URL available? Before you commit 100% to a name, check to see if there’s a good web domain available.
We recommend buying your domain right away because even if launching a business website isn’t on your radar right now, it will be soon.
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Once you register a domain name for your LLC, consider setting up a business phone system to establish credibility and enhance your customer service. Nextiva provides a plethora of useful features and a quick, easy setup. Try Nextiva.
Using a Vermont Assumed Business Name (DBA)
A Vermont DBA (doing business as), also known as an assumed business name, is any registered name that a business operates under that isn't its legal business name. An assumed business name can be used by any type of business, including a sole proprietorship, partnership, or limited liability company (LLC).
Learn how to get a DBA in our Vermont DBA guide.
Step 2: Appoint A Vermont Registered Agent
When you file your Articles of Organization, you'll need to list a registered agent.
Your registered agent can be a person or a registered agent service. You can act as your own registered agent, but many business owners choose to use a registered agent service.
Here are a few things to think about before you decide to act as your own registered agent:
- You’ll need to be available during normal (9 am - 5 pm) business hours at the address you provide
- If you run your business from home, you’ll have to make your personal address public
- You could be served with a lawsuit in front of your family or coworkers
Recommended: Northwest offers a free year of registered agent services when you form your Vermont LLC ($29 plus state fees) with them.
Step 3: File the Vermont LLC Articles of Organization
It’s time to officially form your LLC by filing Form LLC-1(D) - Articles of Organization with the Vermont Secretary of State.
Recommended: Now is a good time to decide if your LLC will be member-managed vs manager-managed.
You'll need to know the following information to complete the form:
- Entity Name
- Business Description
- Physical Address and Email Address
- Registered Agent Name and Registered Office Address
- Names of Officers or Directors (if applicable)
For more detailed help with completing the form, visit our Vermont Articles of Organization guide.
Mail or Submit In Person To:
Send the form and payment (payable to the VT SOS) to:
Vermont Secretary of State
128 State St.
Montpelier, VT 05633
How long does it take to get a Vermont LLC approved? LLC processing time is one to two business days online or seven to ten business days by mail.
Step 4: Create A Vermont LLC Operating Agreement
Creating a Vermont LLC operating agreement is the only way to legally lock down your LLC’s management and ownership structure. Having an operating agreement in place will give you something to return to if a dispute or lawsuit arises.
Even single-member LLCs benefit from having an operating agreement.
Your operating agreement should outline the following:
- Each member’s responsibilities
- How new members will be admitted
- How existing members may transfer or terminate their membership
- How profits and dividends will be distributed
You can add as many provisions as you want, as long as they don't conflict with Vermont business law. Take a look at our What is an Operating Agreement guide to learn more.
Download a template or create a custom Free Operating Agreement using our tool.
Step 5: Get an EIN
An Employer Identification Number (EIN) is like a Social Security number (SSN) for your company. The IRS and the state of Vermont will use this number to track your business activity.
Your EIN will come in handy when it’s time to:
- Open a business bank account
- File Federal and State taxes
- Hire employees
The best way to get an EIN for your LLC in Vermont is by using the free online application on the IRS website.
Read our Get an EIN guide for instructions.
Steps After Forming an LLC in Vermont
After forming your Vermont LLC, it's important to:
Open A Business Bank Account
A business bank account helps separate personal expenses and company expenses, which is required to maintain your Vermont LLC's corporate veil. A corporate veil protects your personal assets from creditors in potential lawsuits against your LLC or Business.
Learn more by reading this guide to Banking for Entrepreneurs. For a multi-member LLC, you'll also want to set up capital accounts for members. We also recommend checking out our review of the best business bank accounts.
Get A Business Credit Card
A business credit card will help separate personal and business expenses while building your company's credit history. A strong credit history will be useful for raising capital in the form of venture capital, angel investment, or small business loans.
Set Up Business Accounting
Hiring a business accountant is one of the best ways to ensure you’re taking advantage of LLC tax benefits; possibly saving you and your business thousands of dollars per year.
When forming an LLC in Vermont, it’s a good idea to start a relationship with a business accountant as soon as you start your business to help set your company up for success.
Get Business Insurance
Keep Your Company Compliant
Research Vermont Business Licenses and Permits
To operate an LLC in Vermont, you will need to comply with federal, state, and local government regulations such as health permits, building permits, and signage permits.
Business licensing and permit requirements vary from state to state. To get started, visit our How to Get a Business License in Vermont guide. To help facilitate this process, you can also utilize a business license service.
File Your Vermont LLC Annual Report
Vermont LLCs must file an annual report with the Secretary of State each year along with a $35 fee. This is primarily done online, although filers can elect to print their form and submit it by mail along with a check.
Understand Vermont State Tax Requirements
Any Vermont businesses that sell physical products typically must register for a seller’s permit with the Vermont Department of Taxes. Visit our Vermont Sales Tax guide to learn more about seller’s permits and Vermont sales tax.
Vermont LLCs must also file and pay the state’s Business Entity Income Tax annually. The minimum tax due is $250 for entities owned exclusively by Vermont residents.
Understand Your Vermont LLC’s Federal Tax Requirements
Most Vermont LLCs will need to report their income to the Internal Revenue Service (IRS) each year using Form 1065: Partnership Return (multi-member LLCs) or Form 1040 - Schedule C (single-member LLCs).
How you pay yourself will affect your federal taxes. Visit our guide to learn more about how to pay yourself from your LLC.
Know Your Vermont LLC’s Federal Tax Election Options
Pass-through taxation entails a business’s profits passing through to the LLC member’s individual tax returns. Like a sole proprietorship, an LLC is taxed as a pass-through entity, also known as a disregarded entity.
Once this process is completed and after any tax-deductible expenses are taken out, the LLC members pay self-employment taxes and income tax on their portion of the business income.
Alternatively, Vermont LLCs can choose to elect to be taxed as an S corporation (S corp) or C corporation (C corp). If S corporation tax status is elected, LLC members can be taxed as employees of the business, potentially reducing tax burden.
More LLC Resources
- Vermont Foreign LLCs: Forming a foreign LLC allows your company to operate as one entity in multiple states. You can file for a Vermont foreign LLC online.
- Vermont Certificate of Good Standing: A certificate of good standing verifies that your LLC was legally formed. To order, follow our Vermont certificate of good standing guide.
- Dissolving a Vermont LLC: If you are ready to dissolve your LLC, follow the steps in our Vermont LLC Dissolution Guide.
- LLC Legal Forms: TRUiC offers a number of free LLC legal forms including operating agreements, LLC resolutions, and hiring documents.