A limited liability company (LLC for short) is a way to legally structure a business. It combines the limited liability of a corporation with the flexibility and lack of formalities provided by a partnership or sole proprietorship. Any business owner who seeks to limit his or her personal liability for business debts and lawsuits should consider forming an LLC.

Here are the steps you need to take to form an LLC in Iowa. For more information on how to form an LLC in any state, see Nolo's article How to Form an LLC.

1. Choose a Name for Your LLC

Under Iowa law, an LLC name must contain as the last words, "Limited Liability Company," or the abbreviations "L.L.C." or "LLC." "Limited" may be abbreviated as "Ltd." and "Company" as "Co."

Your LLC's name must be recognizably different from the names of other business entities already on file with the Iowa Secretary of State. Names may be checked for availability by searching the Iowa Secretary of State business name database. You may reserve a name for up to 120 days by filing an Application for Reservation of Name with the Secretary of State. The application may be filed online, or by mail. The filing fee is $10.

2. Appoint a Registered Agent

Every Iowa LLC must have an agent for service of process in the state. This is an individual or business entity that agrees to accept legal papers on the LLC's behalf if it is sued. A registered agent may be an individual who resides in Iowa, or a domestic or foreign business entity authorized to do business in Iowa. The registered agent must have a physical street address in Iowa.

3. File Certificate of Organization

An Iowa LLC is created by filing a Certificate of Organization with the Iowa Secretary of State Business Services Division. Unlike most states, the Iowa Secretary of State does not provide a downloadable form or online form for the certificate—you will have to draft your own or have a lawyer prepare one for you. The certificate must include:

• the LLC's name
• the LLC's address, and
• the name and address of the LLC's registered agent.

The certificate may be uploaded and filed online or by mail. The filing fee is $50.

4. Prepare an Operating Agreement

An LLC operating agreement is not required in Iowa, but is highly advisable. This is an internal document that establishes how your LLC will be run. It sets out the rights and responsibilities of the members and managers, including how the LLC will be managed. It can also help preserve your limited liability by showing that your LLC is truly a separate business entity. In the absence of an operating agreement, state LLC law will govern how your LLC operates. If an operating agreement is created, it does not need to be filed along with the Certificate of Organization.

5. Obtain an EIN

If your LLC has more than one member, it must obtain its own IRS Employer Identification Number (EIN), even if it has no employees. If you form a one-member LLC, you must obtain an EIN for it only if it will have employees or you elect to have it taxed as a corporation instead of a sole proprietorship (disregarded entity). However, there are practical reasons it makes sense for SMLLCs to obtain an EIN as well; read our article on when to get an EIN. You may obtain an EIN by completing an online application on the IRS website. There is no filing fee.

6. File Biennial Reports

All LLCs doing business in Iowa must file a Biennial Report with the Secretary of State every two years. You can file the report online at the Secretary of State website or download a pre-filled form from the same site. The report is due in odd-numbered years by March 31. You should receive notification from the Secretary of State before the report is due. The filing fee is $30 for online filings and $45 for filings by mail. For more information on Iowa LLC Biennial Reports, see Nolo's article Iowa LLC Filing Requirements.