How to Start a Tennessee LLC
Tennessee LLC Formation – Basics & Helpful Information
This article is meant to be a general overview of the Tennessee LLC formation process; including information about how to start a Tennessee LLC and other basic issues related to Tennessee LLCs.
Tennessee LLC Filing Fees
The Tennessee filing fee for the Articles of Organization (to create an Tennessee LLC) is $50.00 per member in existence at the time of filing, with a minimum of $300 and a maximum of $3,000.
Tennessee Filing Time
Regular processing time generally takes at least one business day.
Tennessee Annual Compliance Requirements
Tennessee LLCs are required to file annual reports. You can file your annual report online. The cost to file your annual report is $300, plus service fees for filing online. You can view videos on how to file your annual report on the Tennessee’s Secretary of State websiteSee videos on how to file your annual report →
Your business may also be subject to Tennessee business tax. Generally, if you conduct business within any county and/or incorporated municipality in Tennessee, then you should register for and remit business tax. Business tax consists of two separate taxes: the state business tax and the city business tax.See more info about Business Tax →
Form an LLC in Tennessee
You can use this checklist to help guide you through the process of forming a Tennessee LLC:
Step 1: Decide on a Business Name
The first step in creating an LLC in Tennessee is naming your business. You’ll need to check with the Tennessee Secretary of State to make sure the name you’ve chosen is available. You can do this online via the Tennessee Business Search.
It is also highly recommended that you check the US Patent and Trademark Office to see if someone has a federal trademark of the business name you want (the Tennessee Secretary of State will not check other state’s databases or the federal trademark database). As such, you should sue the following link to have a comprehensive name availability search performed for you.
Your LLC name must contain the words “limited liability company” or the abbreviations “L.L.C” or“LLC”.
Tennessee Assumed Names
An assumed name is similar to a “doing business as” (DBA) name. Although an assumed name is not legally required, it is a wise business practice. The filing fee is $20. Tennessee assumed names are only applicable in Tennessee and are not substitutes for a national trademark filing.See more info on Tennessee Assumed Names →
Step 2: Register your LLC with the State
Tennessee Articles of Organization
A Tennessee LLC is formed by signing and filing Articles of Organization with the Tennessee Secretary of State. You can also e-file the Tennessee Articles of Organization. The Secretary of State staff will examine the articles for statutory compliance and will either approve the articles for filing or reject the articles with instructions on how to resubmit the document.
The Articles of Organization must include at a minimum:
- Name of the Tennessee LLC
- Statutory Agent’s Name and Address
- Physical or street address of the known place of business of the LLC in Tennessee
- Management Structure of the LLC
- Duration of LLC
- Organizer’s Name and Signature
- Fiscal Year Close Month
- Number of Members at the Time of Filing
Tennessee Registered Agent Information
Tennessee requires that the LLC have a Registered Agent (same as a Statutory Agent in other states), which is an individual or a business entity the LLC appoints for the purpose of accepting service of process (lawsuit papers or legal documents) for the LLC.
An LLC cannot be its own registered agent, but the LLC can appoint one of its members as the statutory agent.
Tennessee law requires that the registered agent have a permanent, physical address on the records of the Tennessee Secretary of State at all times.Read more about Registered Agents →
Step 3: Create and Sign the LLC’s Governing Document
The governing document for an LLC is called the “company agreement” or sometimes the “operating agreement”. The company agreement is to an LLC like a partnership agreement is to a partnership (or bylaws to a corporation). The company agreement governs the internal operation of the LLC and is typically a private document that is kept in the company book and the principal place of business (it is NOT filed with the state). The company agreement can address many issues, some of the more common concepts found within a company agreement are:
- Limitations on the members liabilities
- The level of consent needed to take various actions (i.e. simple majority required to add new members)
- The percentage of the LLC that each member owns
- How profits and losses are allocated between the members (typically based on ownership percentages)
- Limitations on transferability
- What each member is contributing to the LLC and what happens is such contributions are not made.
- The authority of the members, officers, managers, committees, etc.
- How meetings are conducted
One of the reasons we recommend using an LLC formation company like IncFile is that they can provide you with a company agreement in connection with their LLC formation services.
Step 4: Get an EIN
After you form an LLC in Tennessee, you can get the EIN. There are a few different ways to get an EIN:
- Apply Online Yourself: The IRS has an online EIN Application you can use to get an EIN. The turn around time on the EIN using this method is only a few minutes.
- Use Form SS-4: You can get an EIN the old fashion way by completing Form SS-4 and mailing or faxing into the IRS. How long does it take to get the EIN this way? According to the IRS: if you mail in Form SS-4, it will take 4-5 weeks to get your EIN. If you fax in Form SS-4 you should have the EIN back in a week if you provide a fax number or 2 weeks if you don’t have a fax number.
- Have a Third-Party Obtain: All of the LLC formation companies have the ability to get the EIN for you. The EIN obtainment charge varies by company, but it is generally between $50 and $100. If you get one of the higher priced packages, they will sometimes throw in the EIN for free.
Step 5: Get Licenses and Permits
After you create your new Tennessee LLC, you’ll need to determine if your business/profession requires any licenses or permits to conduct business.Read more about Tennessee Licensing and Permitting →
Registering a Foreign LLC in Tennessee
If you have a non-Tennessee LLC (aka Foreign LLC) and you are doing business in Tennessee, you may need to register the Foreign LLC in Tennessee. Each state has a different definition of “doing business”. In Tennessee, the kinds of activities that would not constitute “doing business” are outlined in the Tennessee Code Annotated, Section 48-249-902.
The filing fee for the Application for Certificate of Authority in Tennessee is $50 per member in existence on the date of the filing, with a minimum fee of $300 and a maximum fee of $3,000.