Start an Idaho S Corp

1. Choose a Business Name

In Idaho, you can choose almost any name you want for your S Corp. If you try to use a name that’s the same or very similar to an existing Idaho LLC or Corporation, it might not get approved. Idaho corporations will need to have some sort of variation of “corporation,” “incorporated,” “company,” or “limited” in their name. Similarly, Idaho LLCs need to have a variation of “limited company,”  or “limited liability company” in their names.

2. Appoint a Registered Agent in Idaho

Idaho law requires all corporations and LLCs to have a registered agent. A registered agent is just a person or entity you designate to receive official notices and legal documents. A registered agent must have a physical address in the state.

You can be your own registered agent or let someone else, but it doesn’t give them any authority or control over your business. As an option you can use ZenBusiness’s registered agent service to comply with the state requirement.

3. File Articles of Incorporation/Certificate of Organization 

To form a corporation, you need to file Articles of Incorporation with the Idaho Secretary of State (SOS) and pay all state filing fees. For an LLC, you need to file a Certificate of Organization with the SOS. We can handle either process for you.

4. Create an operating agreement

Create an LLC operating agreement. Operating agreements outline the rules and procedures for the management of the LLC as well as establish ownership percentages, how profits are divided among members, and much more. 

Your Idaho operating agreement also makes your business appear more legitimate to banks, investors, potential business partners, and the courts. While the state doesn’t legally require you to file an operating agreement, if you don’t have one, your LLC will be governed by default by Idaho’s LLC laws, which might not reflect your wishes.

Once an operating agreement is signed by all the members, it becomes legally binding. You don’t need to file it with any government agency, but keep it with your other important legal business documents so you can refer to it easily. 

What should be included?

Typical concepts in an LLC operating agreement may include:

• Procedures for admitting or removing LLC members
• Allocation of profits and ownership
• Management structure and voting requirements
• Procedures for dissolving the LLC and dividing its assets

Unsure as to how to create an operating agreement for your LLC? We offer a customizable template to help get you started. Our chatbot walks you through the process of creating your agreement and allows for e-signature of the document through HelloSign.

5. Apply for an EIN

Apply for a federal employer identification number. Unless you’re a single-member LLC without employees (and sometimes even then), you’ll likely need to get an Employer Identification Number (EIN) from the Internal Revenue Service (IRS). Even if you don’t legally need an EIN, getting one can help you open a business bank account or obtain credit to grow your business. 

You can get your LLC’s EIN through the IRS website, by mail, or by fax. If you don’t want to deal with that particular government agency, we can get it for you. Our EIN service eliminates the hassle.

6. File Form 2553 to apply for S Corp status

Complete and submit the form to apply for S corporation tax election. Once your LLC or corporation formation is approved by Idaho, you need to file Form 2553, Election by a Small Business Corporation, with the IRS to get S corp status. 

The Internal Revenue Service requires you to complete and file your Form 2553: 

• Within 75 days of forming your LLC or C corporation, or no more than 75 days after the beginning of the tax year in which the election is to take effect

OR

• At any time during the tax year preceding the tax year the election is to take effect.

One note for limited liability companies wanting to file as an S corp: If your LLC is past the 75-day election deadline, you’ll also need to file Form 8832, Entity Classification Election, to elect to be taxed as a corporation. Then you file both Form 8832 and Form 2553 together via USPS-certified mail. 

Every one of the members or shareholders must sign the consent statement portion of the form. The IRS website has more information on how to file Form 2553.