How To Form an LLC In Rhode Island (RI)?

Want to learn how to form an LLC in Rhode Island? You’ve come to the right place.

Forming a Limited Liability Company in Rhode Island might seem daunting. However, with the right strategy and research, anyone can do it.

This guide discusses every step you need to take to start your LLC in Rhode Island, including choosing a business name, filing the necessary documents, and complying with state laws. We have also reviewed the three best registered agent companies in Rhode Island, as well as our top recommendations for the LLC formation package. Keep reading to learn more!

Choose a Name for Your Rhode Island LLC

Choosing a perfect business name for your LLC is one of the first and most important steps in forming an LLC in Rhode Island. Choosing an LLC name that is easy to remember and pronounce and stands out in search engine results will lead to more business growth.

When you have a business name in mind, run an LLC name search to ensure that the chosen LLC name is available in Rhode Island and unique to all existing business entities in the state.

In addition, there are LLC naming rules and guidelines you must comply with. These include the following:

• Your LLC name must have the designator “L.L.C.,” “LLC,” or “Limited Liability Company.”
• Your chosen business name must not confuse your LLC with other business types and entities.
• The chosen business name must be distinguishable from other LLCs in Rhode Island.
• Restricted terms, such as “university,” “bank,” or other assuming words in your LLC name, require additional paperwork or approval from the right authorities.

Hire a Registered Agent

Rhode Island law requires all Limited Liability Companies to nominate a registered agent during the formation and operation process. The registered agent’s job is to receive legal correspondence and official documents on behalf of the LLC. They must be a business entity or person in Rhode Island with a permanent street address.

You can nominate yourself or any other member as your LLC as a registered agent. However, the designated person must be available at the provided physical street address during all traditional business hours. With that in mind, most LLC owners prefer adding a layer of anonymity to their business by working with a third-party registered agent company.

You may want to consider one of the following registered agent service providers in Rhode Island:

IncFile

IncFile is a number one option if, together with a registered agent, you are looking to purchase an LLC formation package. For instance, purchasing an IncFile LLC formation package will give you a complimentary year of free registered agent services.

At only $119 per year, you can access various registered agent services, including an online personal dashboard, automatic mail forwarding, and custom SMS and email alerts.

ZenBusiness

ZenBusiness is our second recommendation for the best registered agent company in Rhode Island.

Popular for being ranked the  #1 service provider on influential sites, such as Forbes and MarketWatch, ZenBusiness will give you access to many tools to remain compliant with state laws. These include email alerts, a custom dashboard, and document scanning.

ZenBusiness’ registered agent package costs only $199 per year.

Northwest

Northwest is our third recommendation for the best Rhode Island registered agent company. It is a cost-effective registered agent option that will give you access to many tools to help you comply with state laws.

At only $125, you will get access to all the essential registered agent services, including mail forwarding, document scanning, compliance notifications, and document storage. If you hire them in multiple states, you will get a discounted annual fee of $100.

File an Article of Organization

To legally form and register your LLC in Rhode Island, you must file an Article of Organization with the Secretary of State.

While this can sound complex, filing your LLC’s Article of Organization only entails filling out and submitting a standard form available on the Rhode Island Secretary of State website. You can either complete the filing process online via the Rhode Island Online Business Formation portal or file via mail.

Either way, you must provide the following details about your LLC:

• The chosen LLC name
• Detailed information about the hired registered agent
• LLC management structure ( Member-managed or manager-managed)
• Purpose of your LLC
• The effective date of your LLC
• Names and addresses of the LLC members and managers.

The fee for filing your Article of Organization in Rhode Island is $150. Once filed, the approval usually takes one to three business days. You can check if your filing was accepted via the Rhode Island Secretary of State’s online system.

Draq Up an Operating Agreement

The state of Rhode Island does not require LLC members to draft an operating agreement. However, you should consider creating one as an essential step in forming your LLC. For instance, an operating agreement is a legal and internal contract that defines the governing structure of your Rhode Island LLC, shares of LLC losses and profits, as well as the rights and roles of each LLC member.

Creating an operating agreement for your LLC is a straightforward process. You only need to provide the following information:

• The LLC’s purpose, including services and products offered
• The dissolution procedures
• Names and physical addresses of all members and managers
• The ownership percentage of each member
• The distribution of profits and losses
• The voting rights and processes
• The process of admitting and removing members

All LLC members must carefully review and sign the created operating agreement. Although you won’t need to file your operating agreement with the state, you should store it with other essential business records.

If the thought of creating your LLC’s operating agreement sounds intimidating and time-consuming, we recommend hiring an LLC formation company that offers operating agreement packages.

Get Necessary Licenses and Permits

You do not need to obtain a state-level general business license to operate your Limited Liability Company in Rhode Island. However, depending on your profession and the nature of your business, you may need to get a business license and permit from your government.

For example, if you plan to hire employees or sell products subject to sales tax, you must register with the Rhode Island Business Licenses portal or the Secretary of State office for payroll tax and sales tax purposes.

You may also need specific licenses from the Rhode Island Department of Health and Department of Business Regulation if your LLC sells food or restricted products, such as tobacco products and alcohol.

Moreover, certain city and county governments may need local business permits and licenses. Contact your local county office for more information about the local licensing requirements and fees for your LLC.

Get an EIN

If your LLC has more than one employee, you must acquire Federal and State Tax ID. Also referred to as an Employer Identification Number, a Federal and State Tax ID is a nine-digit number used by the IRS for tax purposes. You can think of an EIN as a Social Security Number for your business entity.

Some business entities, such as single-member LLCs with no employees, are not legally required to acquire an EIN. However, we recommend getting one even if you fall under this category. For instance, you will need it to open a business bank account, file tax returns, and hire employees.

Acquiring an EIN is straightforward and free of charge in Rhode Island. You only need to visit the IRS website and submit your application.

Open a Business Bank Account

Business bank and credit accounts separate your LLC and personal finances, enhance your LLC’s credibility, ensure accurate financial records, and simplify tracking transactions. This separation is vital in protecting your personal assets, presenting a professional LLC’s image to suppliers and clients, and complying with tax and legal requirements.

To open a business bank account, you only need to visit a bank with your LLC’s Article of Organization, Federal and State Tax ID, and an Operating Agreement. Some banks may also require a small deposit amount.

Choosing the right financial institution and type of bank account is crucial. So, you should shop around for an ideal bank. Perhaps one of the following might work:

• BankRI
• Centreville Bank
• ​​BankFive

Purchase Rhode Island Business Insurance

Business insurance is crucial to running an LLC as it protects your business and its members in case of claims, injuries, accidents, or natural disasters. Unlike other states, Rhode Island is more firm about business insurance. It requires all LLCs to obtain general liability insurance during the formation process. This insurance policy protects the LLC against claims resulting from property damage and personal injuries.

All LLCs with one or more employees must purchase workers’ compensation insurance. This policy protects employees against on-the-job injuries, illnesses, or even death.

LLCs with company vehicles must acquire an auto liability insurance policy to cover drivers and vehicles.

However, LLCs in Rhode Island must only obtain property insurance if they are residential landlords. However, we recommend purchasing one to cover equipment and property losses due to natural disasters, theft, or fire.

Accelerate the Process with an LLC Formation Package

The above LLC formation steps can be too much, and you may want assistance setting up your Rhode Island LLC. Luckily, you can purchase an LLC formation package and have your LLC formed quickly.

There are dozens of service providers that offer comprehensive yet affordable LLC formation packages. Some are even free of charge.

Such is the case with ZenBusiness. For instance, their Starter package comes with all the essential tools required to form an LLC. You will only be required to pay for the state filing fee. They also have the Pro and Premium LLC formation packages, which cost $199 and $299 annually, respectively. These two packages come with extra benefits, such as expedited filing, worry-free compliance, and domain name.

Northwest is another reputable service provider that offers appealing LLC formation packages that include their renowned Corporate Guides, registered agent, and operating agreement at only $225 per year.

If you have a tight budget for this purpose, you may want to consider MyCompanyWorks. They offer the essential LLC formation tools and services at only $59 plus state filing fees.

FAQs About Forming an LLC in Rhode Island

How Long Will It Take to Form My Rhode Island LLC?

You can get your LLC ready in Rhode Island in three to four business days if you file your Article of Organization online ( or two weeks if you file by mail). Unfortunately, Rhode Island does not offer expedited online and mail filing processing times.

How Much Does It Cost to Set Up an LLC in Rhode Island?

It costs $150 to form a Limited Liability Company in Rhode Island. This is the fee for filing your LLC’s Article of Organization with the Rhode Island Secretary of State. There may also be additional fees for hiring a registered agent, filing annual reports, etc.

Can I Act as my Own Registered Agent in Rhode Island?

Yes. You can appoint yourself a registered agent for your LLC in Rhode Island. However, after considering the requirements for being a registered agent in Rhode Island, most entrepreneurs choose to hire a registered agent company instead. For instance, to be a registered agent, you must be available to work during all regular business hours in this state. You must also have a physical street address in Rhode Island.

Can I Form a Single-Member LLC in Rhode Island?

The LLC filing and payment requirements in Rhode Island apply to both single-member and multi-member LLCs. So, you can easily form a single-member LLC in Rhode Island by following the steps, guidelines, and requirements outlined in this LLC formation guide.

Launch your Rhode Island LLC today

Forming a Limited Liability Company (LLC) in Rhode Island can be straightforward if you follow the required steps.

By following this step-by-step LLC formation guide and taking proactive measures, such as choosing the right LLC name, filing the required paperwork, and complying with the state laws, you will be well on your way to successfully forming your LLC in Rhode Island.

Also see:

• Rhode Island (RI) Secretary of State (SOS) LLC & Business Search
• Rhode Island (RI) Registered Agent Services
• How To Find Rhode Island Bookkeepers