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Here are the steps you need to take to form an LLC in Alabama. For more information on how to form an LLC in any state, see our article Forming an LLC - A 50 State Guide.

If you're ready to set up your LLC today, you can do so in any state through LegalZoom for $149 plus filing fees. To get started, click here.

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Step 1. Choose a name for your LLC

The first step to forming your LLC is to come up with a name. When doing so, there are a few things you need to look out for.

1. Follow Alabama's naming guidelines

When forming an LLC in Alabama, your businesses name must comply with the following:

  • Alabama's law requires that your LLC name include the word Limited Liability Company (or any abbreviations of this, including LLC or L.L.C.).
  • The name you go with cannot mislead the public as to your businesses was organized for a purpose not included in your articles of organization.
  • Restricted words (e.g. Bank, Attorney, University) require additional paperwork and may require a licensed individual, such as a doctor or lawyer, to be part of the LLC.
  • Prohibited words are those that would cause the public to mistake the name of your LLC with a federal or state agency (e.g. FBI, Secret Service, Treasury etc.)

2. Check that the name is available

The name must be distinguishable from the names of other businesses already on file with the Alabama Secretary of State. You can check Alabama's business name database to see if your name is available.

3. Reserve the name

Once you've chosen a name for your LLC, you need to reserve it before filing any documents. This can be done online or by mail.

4. Check to see if the domain is available

You don't necessarily need a .com domain, but if you want to make sure you're going to have a domain, it's best to get one before you file any documents with the state. You can check to see if your domain name is available on GoDaddy.com.

Step 2. Choose a registered agent

In Alabama, you are required to nominate a registered agent for your LLC.

A registered agent is a person or business that agrees to send and receive legal papers on behalf of your LLC, such as service of process of legal action and state filings.

Your registered agent must be a resident of Alabama - either a business entity or an individual.

You can learn more about registered agents here.

Step 3. File your certificate of formation

Filing your certificate of formation with the state of Alabama officially registers your LLC with the state.

The certificate of formation must include the following:

  • The LLC's name, purpose, and address
  • The names and addresses of organizers (and managers, if any)
  • The name and address of its registered agent.

You must also attach the following (if applicable):

  • A terms and conditions explanation (if members have the right to admit additional members)
  • The circumstances, if any, that result in the LLC’s dissolution.

You can download the PDF here. The filing fee is $100.

Step 4. Prepare your operating agreement

You aren't required to have an operating agreement in Alabama, but it's a good idea to have one in place that outlines the ownership and operation procedures of your LLC.

Check out this guide for more on creating an operating agreement for your LLC.

Step 5. Get an EIN

An Employer Identification Number (EIN) is basically a social security number for your business. It's used by the government to identify your business and track tax payments.

You'll need an EIN to file federal and local taxes, and some bank accounts require you to have one in order to open an account with them.

You can get your EIN here.

Step 6. Get your required business licenses

Depending on your business type and location, your LLC may need to obtain other local and state business licenses.

Here's a list of required Alabama business licenses.

Step 7. Pay your state taxes

Alabama requires LLC's to file a Business Privilege Tax and Annual Report with the Alabama Department of Revenue 14 weeks after the beginning of the LLC's taxable year.

The minimum annual tax is $100.

In some cases (such as if you have employees or if you'll be collecting sales tax), you'll have to register with the Alabama Department of Revenue, which you can do online or on paper.

Other things to keep in mind

Special rules for professional services

LLCs in Alabama can provide professional services, but only one specific type of service may be provided by each LLC, and all owners of the LLC must be licensed to perform the service.

Foreign LLC's doing business in Alabama

LLC's organized outside Alabama must register with Alabama's secretary of state to do business in Alabama, and must have a registered agent inside Alabama.

You can register online for a filing fee of $250.

If you're ready to set up your LLC today, you can do so in any state through LegalZoom for $149 plus filing fees. To get started, click here.

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