If you want to learn how to form an LLC in Hawaii and make your business dreams come true, the time is now! And we’re here to help.
This guide will teach you everything you need to know to bring your business to life. We will walk you how to form an LLC in Hawaii and answer some of the commonly asked questions about Hawaii LLC formation.
Ready to get your business off the ground? Let’s dive in together!
Choose a Name for Your Hawaii LLC
Choosing a unique name is always the first step in forming your Hawaii LLC. We recommend choosing a name that is easy to pronounce, easy to remember and relevant to your business.
Your name should also comply with Hawaii’s LLC naming requirements:
- The chosen name must include “LLC” or “L.L.L” or “Limited Liability Company.
- Purely geographic names, or landmarks registered with a recognized historical registry, are not allowed.
- Restricted words, such as Attorney, Bank, and University, may require extra paperwork. Besides, a licensed person, such as a lawyer or doctor, must be part of the LLC.
You can learn more about LLC naming requirements by reading the Hawaii naming rules.
Check name availability in Hawaii
Ensure the name you choose for your Hawaii LLC is not already taken by another business. This is simple to do by searching the Hawaii state website for business names.
Check the URL availability in Hawaii
You should also check if the preferred name of your Hawaii LLC is available as a web domain. Even if you do not intend to make a website for your business, we recommend buying a URL to stop others from acquiring it.
Hire a Registered Agent
Once you’ve chosen a name for your Hawaii LLC, it’s time to hire a registered agent.
A Hawaii registered agent is a business entity or an individual authorized to accept official documents on behalf of your LLC.
In Hawaii, a registered agent can be you, any person within the company or a trusted third party. Whoever it is, a registered agent in Hawaii must fulfill the following conditions:
- Must have a Hawaii physical street address. A P.O. Box address will not be sufficient to accept documents in Hawaii.
- Must be available at all working/business hours to accept legal documents.
If you are not a Hawaii resident, you can hire an official local registered agent. Professional registered agents in Hawaii will cost between $50 and $300 a year and are a great choice to streamline your operations.
We’ve highlighted three of our favorite providers below…
Northwest Registered Agent ($125 per year)
Northwest is a reputable Hawaii registered agent, boasting knowledgeable staff and exceptional customer support services. They also have Corporate Guides that provide personalized assistance throughout your entire business journey.
With Northwest, you get comprehensive registered agent features and services, which include the following:
- Automated privacy by default
- Same-day scanning of local documents
- Free mail scanning and forwarding
- Lifetime Corporate Guides support
You can even go paperless, too. With Northwest, you will get a digital account to access essential business forms and documents.
ZenBusiness ($199 per year)
ZenBusiness offers competitive value for money and excellent customer support. The company’s highly-rated standard service costs $199 per year. Upgrade to ZenBusiness’ Complete, however, and you will get a year of worry-free compliance.
Standard services you get with ZenBusiness include the following:
- Annual document filing alerts
- Good standing coverage
- Two free annual amendments/changes to your filings
There’s nothing not to like about the ZenBusiness service.
LegalZoom ($249 per year)
LegalZoom is probably the most well-known registered agent service in the business. That stature equates to higher pricing, however, and its annual fee is $249.
That’s not to say the company doesn’t offer value for money. With LegalZoom, you do get a vast range of registered agent features and services, such as unlimited cloud storage, a compliance calendar, and business data protection.
Register Your Business
You need to complete an Article of Organization form (LLC-1) to register your business in Hawaii. This form requires you to provide the following information:
- Member Liability
- The business mailing address
- Registered agent’s address and name
- LLC name
- Length of duration for the LLC
- Address and name of the managers
- Your signature
The easiest and fastest method to register a business in Hawaii is to file an Article of Organization with Hawaii Business Express. You will need an active email address to create an account using your LLC name and have your credit card handy.
If you do not want to register your business online, you can download the LLC-1 Article of Organization Form, print it out and fill it in. Next, mail the filled Article of Organization LLC-1 form and a money order or check for the $50 fee plus an additional $1 State Archive fee. You can also send them in person to the following address:
Hawaii Department of Commerce and Consumer Affairs – Business Registration Division
335 Merchant St.
P.O. Box 40
Honolulu, HI 96810
Mailed Article of Organization LLC-1 forms take 14 days to process, while hand-delivered forms take 3-5 days. However, online processing takes just 1-3 days, with a $25 expedited processing fee to make things even faster.
Create an Operating Agreement
A Hawaii Operating Agreement is an internal document used to outline the operating procedures and proprietorship of your LLC legally. It is an important document that ensures all business owners or partners are on the same page when it comes to how they run their businesses — and reduces the chances of future conflicts.
When it comes to creating an Operating Agreement for your Hawaii LLC, you should know that it is not a requirement by the Hawaii state to have a comprehensive operating agreement.
Nevertheless, we highly recommend creating one. This will be vital in making future business decisions, especially when it comes to selling or dissolving your LLC in the future.
Obtain all Licenses and Permits
You may need to obtain certain licenses and permits, depending on the business activities and location of your Hawaii LLC.
In Hawaii, county and state business privilege licenses and permits are issued via the county probate offices. For instance, they offer businesses and LLCs with the following:
- New licenses and permits
- Copies of licenses and permits
- Transfer of licenses and permits
- Renewal of licenses and permits
- Any other amendments to the licenses and permits
If you need assistance obtaining your Hawaii business license and permit, you can use a service like MyCorporation’s business license and permit compliance package. They have skilled and experienced professionals who will do everything for you. For instance, they will identify all the licenses and permits needed by your Hawaii LLC and give you all the information required to obtain them.
Acquire Federal and State Tax IDs
The Federal and State Tax ID is a nine-digit number, sometimes called an Employee Identification Number (EIN). Acquiring it will enable you to file taxes and open a bank account under your Hawaii LLC’s name.
Obtaining a federal and state tax ID in Hawaii is free. You can apply for it via the IRS website. Be sure to use the details in your Article of Organization (LLC-1).
According to the rules and regulations of the IRS, a Hawaii LLC with two or more members must get a Federal and State tax ID.
Single-member LLCs in Hawaii will require one if they choose to be taxed as an S-corp or corporation or have any employees. If your single-member Hawaii LLC does not have employees, you can use your Social Security Number. However, all other LLCs in Hawaii must have a Federal and State tax IB.
Open Business Bank and Credit Accounts
Your Hawaii LLC requires its own bank and credit account to maintain its status as a limited liability. This is because your LLC is a legal entity with liabilities and assets separate from yourself and other business owners.
If you mix personal and business finances, a court can declare your LLC as not being a genuinely separate entity, and you can be held liable for any damages.
To open an account, you must have the following documents:
- A copy of Hawaii LLC Article (Certificate) of Organization
- Your LLC’s federal and state tax ID
- Your LLC’s operating agreement
- An LLC resolution to open a Hawaii bank account if your LLC has two or more members.
If you’re looking for a bank account, choose from one of the highly regarded banks below:
Purchase Hawaii Business Insurance
Once your Hawaii business is up and running, you’ll need to purchase business insurance policies.
State laws affect which business insurance policies you require in Hawaii. Some insurance policies are mandatory, while others are optional. Some of the most common Hawaii business insurance policies you should purchase include the following:
- General liability insurance: It protects your LLC from the high costs of lawsuits and covers common business risks like advertising injury, customer property damage, and customer injury.
- Workers’ compensation insurance: It covers employees’ lost wages and medical costs of work-related illness and injuries.
- Commercial property insurance: It pays for replacing and repairing damaged, lost, or stolen business properties.
- Business owner’s policy: It bundles commercial property insurance and general liability insurance.
You can get a competitive quote for all your Hawaii business insurance needs by visiting a comparison website like Insureon.
Buy an LLC Formation Package to Speed Up the Process
Forming a Hawaii LLC on your own is straightforward if you follow the steps above. But, buying an online LLC formation package can speed up the process.
LLC formation service providers, like ZenBusiness, Northwest, Incfile, and LegalZoom, will allow you to optimize the process of forming your Hawaii LLC at a minimal cost.
You only need to choose a name for your LLC, and the LLC formation service provider will handle the rest. For instance, LLC formation packages include features and services for all stages of forming your Hawaii LLC and beyond, including the following:
- Live expert assistance
- Assistance applying for federal and state tax ID
- Tax preparation and advising
- Registered agent services
- An intuitive dashboard to store and view all documents
One of the many benefits of buying an LLC formation package is that you will get a money-back guarantee if the state fails to accept your filing or you aren’t satisfied with their services.
FAQs About Forming an LLC in Hawaii
How Long Will It Take to Form My Hawaii LLC?
It can take up to 14 business days to process LLC formation documents in Hawaii. However, this processing time can be expedited with online filing, which takes 3-5 business days. You can also speed up the process further by a fee of $25 to have your LLC formation processed in 1-3 business days.
How Much Does It Cost to Set Up an LLC in Hawaii?
Setting up a Hawaii LLC with the Hawaii Business Registration Division – Department of Commerce and Consumer Affairs costs $50, plus an additional State Archives fee of $1.
Can I Act As my Own Registered Agent in Hawaii?
Yes! You can appoint yourself a registered agent for your Hawaii LLC. However, this is not always a wise decision. For instance, as a Hawaii LLC registered agent, you must always be available during regular working hours, and you need to have a physical presence in the state.
Therefore, hiring an outside registered agent like ZenBusiness would be a great idea.
Can I Form a Single-Member LLC in Hawaii?
Yes, and the process and steps of setting up a Hawaii single-member LLC are identical to those discussed in this article.
It’s easy to form an LLC in Hawaii. It does not involve too many complicated steps. However, it is essential to get each step right.
Getting assistance from a reputable LLC formation service provider will give you confidence and ensure your Hawaii LLC is formed efficiently and quickly.
If you have any questions about forming an LLC in Hawaii, let us know in the comments below!