How to Start an LLC in Maine

Whether you’re a new business owner or looking to establish an existing business as an LLC, the process of setting up your first LLC can seem overwhelming. There are several regulations and rules that you need to follow in order to get your business legally established, which can seem intimidating to a lot of people. Fortunately, we’re here to help take some of the stress of this procedure off your shoulders. In this guide, we will be discussing each step of the process involved in setting up your LLC. We’ll also be giving you a rundown of all of the regulations you need to follow, documents you need to file, and fees that need to be paid so you can understand how to establish your LLC for as little as $175!

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Step 1. Naming Your Maine LLC

One of the most important steps in setting up your Maine LLC is naming it. Your LLC name should be unique and distinct from other businesses in the state, in addition to following the below naming rules.

Legally Required Designation

In line with Maine LLC regulations, the name of your business must contain the phrase “limited liability company” or one of the following abbreviations:

• LLC
• L.C.
• LC
• C.
• Limited Company

Unique Name

In order to pick an LLC name that is available and distinguishable from every other business in the state, you should run a search using the Maine Secretary of State’s business database tool. This will help you narrow down your ideas and avoid any type of infringement with your chosen LLC name.

If you find a name that you like, you can file an Application of Reservation of a Name ahead of time. This document will hold your chosen LLC name for up to 120 days before filing. It has a $20 filing fee and must be submitted through the mail to the address below. You can expedite the processing of this form for an extra $50 and have it processed in 24 hours.

Secretary of State

Division of Corporations, UCC and Commissions

101 State House Station

Augusta, ME 04333-0101

 

While searching for an LLC name, you may also want to perform a domain name search. Even if you aren’t sure that you want a business website immediately, it is a good idea to purchase a matching name ahead of time, as this will reserve it for when you need it.

Restricted Words

When choosing an LLC name, keep in mind that you are not able to include any words that run the risk of confusing your business with a government entity. This can include words like “Treasury,” “IRS,” “FBI,” or “State Department.”

You should also be aware that using words such as “bank,” “trust,” or “contractor” may require the presence of a properly licensed individual in your LLC and filing additional paperwork.

Using a Trade Name

You can use a trade, or DBA (doing business as), name for your LLC in Maine. This means that you will continue using the legally registered LLC name on all official documents, but will use a different registered name when interacting with the public.

To register your DBA name in Maine, you will need to file a Statement of Intention to Transact Under an Assumed or Fictitious Name. This form must be filled out and mailed to the address below, with a check made out to the Maine Secretary of State for the $40 filing fee. You may also choose to pay the $50 expedited fee for 24-hour processing.

Secretary of State

Division of Corporations, UCC and Commissions

101 State House Station

Augusta, ME 04333-0101

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Step 2. Appoint a Registered Agent

A registered agent is required for every LLC established in Maine. Your registered agent will be responsible for receiving all legal documents, government communications, and necessary tax documents, acting as a contact point between your LLC and federal agencies or the state of Maine. They will also be the responsible party that is contacted in the event of a lawsuit against your LLC.

You can appoint any Maine resident or a business that is authorized to conduct operations in the state as your registered agent. As long as your appointee has a valid Maine address, they are eligible to be your registered agent. You can review a list of commercial registered agents that are registered with the Secretary of State’s office here.

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Step 3. File Your Articles of Organization

In order to officially establish your LLC in Maine, you will need to file your Certificate of Formation. This document will need to include information about your LLC, some of which we’ve included below for you to review.

• Your LLC’s name
• Your LLC’s effective date, if not immediate
• If your LLC is a low-profit LLC (skips down to our [ANCHOR TO #FAQs]FAQs[END ANCHOR LINK] for more information on this)
• If your LLC is a professional LLC (such as an accountant, chiropractor, or veterinarian)
• Your LLC’s registered agent name and address
• The signature of an authorized person in your LLC

The Certificate of Formation must be filed by mail and will need to include the Filer Contact Cover Letter (this can be found on the form). There is a $175 fee for filing the form, and you can choose to pay an extra $50 for expedited 24-hour processing, or an extra $100 for immediate processing.

Send the completed form and check to cover the applicable filing fees to the address below. Without expediting, processing will take between 5 and 10 business days. Once the form has been processed, your LLC can legally start conducting business in the state. You will also receive a Maine LLC Charter ID number.

Secretary of State

Division of Corporations, UCC and Commissions

101 State House Station

Augusta, ME 04333-0101

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Step 4. Create an Operating Agreement

Maine is one of the few states that does require all LLCs to create an operating agreement. An operating agreement sets clear guidelines for how exactly your LLC is managed, the rights that members or managers have, and what to do in the case that your LLC dissolves or experiences a lawsuit.

In addition to being required by the state, most business bank accounts, loan applications, and other business services will require you to have an operating agreement on hand to demonstrate your LLC as a separately operating business entity before you can secure funding or business services.

You will not need to file your operating agreement with the state, but it will need to be created around the same time you file your Certificate of Formation and treated as an important internal document. You may choose to give copies to all members and managers in order to keep everyone involved in your LLC updated.

You can view a Maine operating agreement template here, or you can work with a legal advisor to develop your own unique operating agreement.

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Step 5. Get an EIN/Tax ID Number

Once your LLC is legally established in Maine, you will need to apply for a Tax ID number, also known as an EIN (Employer Identification Number), through the IRS. Any LLC that has more than one member, any single-member LLC that wants to hire employees, or any company that chooses to be taxed as a corporation is required to apply for an EIN.

Your EIN will be used to identify your business to the IRS on all tax documents and necessary government filings. The number acts much like a social security number for your LLC. If you want to hire employees, file federal taxes, open business bank or credit accounts, or apply for business funding, you will need an EIN.

It is free to apply for your EIN with the IRS, and you can file the application online or by mailing it in. Keep in mind that if you are a foreign filer or do not have a social security number, you will need to file for your EIN through the mail.

Online

The quickest and easiest way to apply for your EIN is online, and you will receive your number once your application is completed. Visit the IRS website to apply for your EIN for free.

By Mail

You will need to fill out this form when applying for your LLC by mail. If you are a foreign filer or do not have a social security number, leave section 7b blank. Mail the completed form to the address below. You can follow up on any questions with the IRS at (267) 941-1099.

Internal Revenue Service

Attn: EIN Operation

Cincinnati, OH 45999

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Step 6. Keeping Your LLC Running

Even after your LLC has been established, there are certain rules and regulations that you will need to keep up with to ensure that your business stays running without issue.

File Annual Reports

Every LLC in Maine is required to file an annual report with the state. This report includes basic information about the LLC and keeps the state up to date on your business’s operations. The report is due each year by June 1st and has an $85 filing fee associated with it.

You can download a preprinted annual report from the Secretary of State’s website here and then send it to the address on the form to file by mail (make sure to include a check for the applicable filing fees). You may also file your annual report online, using the portal on the Secretary of State’s website.

Separate Your Business Finances

A business credit or debit account can help keep your LLC’s finances separate from any personal ones, establishing the LLC as an independently operating business. It is not required by Maine to open a business bank account, but it may be a good idea to establish one anyway.

You will most likely need to show your Articles of Organization, Operating Agreement, EIN, or possible other LLC documents to open a bank account for your LLC. Compare all of your options before making a choice on which bank account to open, as different banks will have different minimum required balances or credit spending limits, so you want to be sure that you select something that is the best for your LLC’s needs.

Keep up With Federal and State Taxes

It is important to be knowledgeable of both federal and state taxation requirements to ensure that you avoid any major penalties or tax issues. If you have questions at any point about your taxes or how much your LLC owes, don’t be afraid to reach out to a financial advisor or an accountant to assist you.

Federal Tax Requirements

There are several different tax structures you can choose from to use in your LLC that may meet different company needs; each tax structure comes with its own unique type of federal taxation. This article can help you gain an in-depth understanding of the differences between each type and help you decide which is best for you.

In general, most LLCs are taxed as sole proprietorships or partnerships. This means that you will be expected to file Schedule C along with your individual income tax return to declare any income that you receive through your LLC.

When using this tax structure, you should keep in mind that you will most likely need to pay self-employment tax (which has a rate of 15.3%), in addition to any income tax. You may also need to make quarterly estimated tax payments to avoid any IRS fines.

If you want, you can choose to have your LLC taxed as a corporation, like an S Corporation or a C Corporation. You will need to fill out IRS Form 8832 and IRS Form 2553 to make this declaration. After these forms have been processed, your LLC will be treated as a corporation and expected to file a separate corporate tax return with the IRS.

Maine Business Taxes

While Maine does not have a general business tax for LLCs, it does have a state income tax and a state corporate income tax. This means that for LLCs taxed as sole proprietorships or partnerships (pass-through entities), you will be required to pay taxes on your LLC income as part of your individual yearly state tax return.

The corporate income tax applies to LLCs that have elected to be taxed as either an S or a C Corporation. You can find out more about paying and registering for this tax by accessing the information on the Maine Department of Administrative and Financial Services website.

Sales and Use Taxes

If your LLC will be selling goods or services, you may be liable to pay sales and use taxes. This tax can be registered for through the Maine Department of Administrative and Financial Services (Maine Revenue Services), where you can also find information about calculating this tax, setting up estimated payments, and determining sales tax exemptions.

State Employer Taxes

LLCs that will have employees may be required to pay state withholding and unemployment insurance taxes. Withholding taxes can be registered and paid through the Maine Revenue Services website, while you will need to register for unemployment insurance taxes through the Maine Department of Labor.

Keep in mind that you may also be required to pay these taxes on a federal level, so make sure to double-check what you owe and consult with a financial advisor if you are confused at any part in the process of calculating these taxes.

Acquire Necessary Permits and Licenses

There is no general business license requirement in Maine, but you may be required to obtain permits and licenses on a city or county level. You should check with your locality’s clerk’s office to ensure you have all the licenses you need. This is especially important for professional LLCs that need to meet state requirements to operate in the state.

Information about Maine business licensing can be found here. If you have questions about what is required of you, you can visit the Maine Business Answers website. This organization is designed to provide free assistance to those who are setting up a small business or LLC in the state or have questions about business licensing.

Additionally, you may be required to obtain certain permits and licenses for your LLC on a federal level. Whether this is needed depends mostly on the type of business you are running and the services you are offering. For help determining if you need to meet additional federal licensure requirements, you can use the directory on the U.S. Small Business Administration’s website.

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Maine LLC Resources

The below list of resources can guide you through each step of the process in starting up your Maine LLC.

• • • • • Available LLC name search
        • Available domain name search
        • Reserve an LLC name
        • Register a DBA name
        • List of Maine commercial registered agents
        • Operating Agreement template
        • Certificate of Formation
        • IRS EIN online application
        • Receive a preprinted Annual Report
        • Annual Report online file
        • Maine Department of Administrative and Financial Services
        • Maine Department of Labor
        • Maine business licensing information
        • Maine Business Answers website
        • S. Small Business Administration

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Maine LLC FAQs

These frequently asked questions can help put to rest any remaining worries about starting your LLC up in Maine.