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The State of New Hampshire offers a lot of opportunities for small business owners. Aside from a competitive, energetic marketplace, the state boasts funding and development programs in an array of fields. All of these elements make the Granite State a dynamic place to launch your limited liability company, or LLC. Here’s how to establish your New Hampshire limited liability company.
How to start an LLC in New Hampshire
- Name your New Hampshire LLC
- Create a business plan
- Get a federal employer identification number (EIN)
- Choose a registered agent in New Hampshire
- File for your New Hampshire Certificate of Formation
- Obtain business licenses and permits
- Understand New Hampshire tax requirements
- Prepare an operating agreement
- Examine business insurance options in New Hampshire
- Understand financial considerations
- Market your LLC
What is an LLC?
A limited liability company (LLC) is a popular choice of business entity across the United States. Its popularity is due in large part to the benefits it affords business owners. These include legal protections and tax treatment. Owners of LLCs, known as “members,” are generally not held personally responsible for the LLC’s business debts. Instead, liability to repay those debts (or damages from legal claims) stays within the LLC itself.
The other main benefit of running an LLC is its tax status. LLCs generally enjoy “pass-through” tax status—meaning they are taxed one time at members’ personal-income rates. LLCs also usually avoid corporate taxes that state and federal authorities levy on income generated by a business before it’s distributed to owners or shareholders. LLCs can elect for the business to be taxed as an S corporation, which would subject it to corporate taxation in some jurisdictions, but this is rare.
Is an LLC right for you?
The LLC isn’t the only business structure available to New Hampshire entrepreneurs. Others include the sole proprietorship or corporation. To figure out if an LLC is right for you, consider the following questions:
- Do you have personal assets in need of protection? By forming an LLC, you can keep your personal and business assets separate, thereby shielding most or all of your personal assets from creditors of the business and litigants against it.
- Are you looking to limit your tax liability? LLCs, by default, do not pay corporate taxes. They are generally treated as pass-through entities—meaning they are subject to one round of taxation at members’ personal income levels. Traditional corporations are usually subject to “double taxation,” which is both corporate and income tax. It’s important to note corporate taxes only apply to LLCs that choose to be taxed as S corps.
1. Name your New Hampshire LLC
Choosing a name for your New Hampshire LLC is one of the first important decisions you’ll make as a small business owner since it’s the first step toward building enduring brand equity. Your LLC name will communicate your business’s function and mission in a way that’s catchy and memorable. You must also follow these specific New Hampshire LLC naming guidelines:
- The name must be unique. The name of your New Hampshire LLC must be different from any other business name presently registered with a state government agency. You can check to see if your desired name is available by searching the database of existing businesses maintained by the New Hampshire Secretary of State’s office.
- The name must contain certain words. Your New Hampshire LLC name must contain the words “limited liability company,” or an abbreviation thereof (“L.L.C.” or “LLC”).
You can reserve your LLC name ahead of time with the Secretary of State’s office for a maximum of 120 days. The reservation must be filed by mail and include a $15 filing fee.
2. Create a business plan
Writing a business plan is an indispensable step toward building a business, in New Hampshire or elsewhere. A plan will help you identify startup costs and estimate overhead, thereby indicating whether you need to reevaluate your business goals, or pursue additional funding. Business plans can help investors evaluate the potential profitability of your business before they decide to invest.
A workable business plan should include your LLC’s name and a brief description of what you sell: a product, a service, or both. It should also contain a thorough market analysis, an outline of the management structure, profiles of target customers, and marketing, logistic, and financial plans.
3. Get a federal employer identification number (EIN)
An employer identification number (EIN) is a federal tax ID—a nine-digit number assigned to businesses by the US Internal Revenue Service (IRS) to track tax obligations. Think of it like a Social Security Number for your LLC. You’ll need an EIN to register your LLC with New Hampshire authorities, and you can obtain one online through the IRS website, free of charge.
4. Choose a registered agent in New Hampshire
All LLCs in New Hampshire are required by law to appoint a registered agent. A registered agent is an individual or business entity (known as a registered agent service) authorized to accept legal documents and other official correspondence on your LLC’s behalf. You can appoint a member or employee of your LLC to this role, or hire a third-party individual or service. If the registered agent is an individual, they must reside in the state; if they are a service, it must be authorized to transact business in the state. All registered agents must be available at a street address (not a PO box) during normal business hours to sign for delivered documents.
5. File for your New Hampshire Certificate of Formation
To formally establish your LLC in New Hampshire, you must file paperwork known as a Certificate of Formation. Certificates can be filed online or by mail, and must include:
- The LLC’s name
- The business address, email address, and phone number of the LLC
- The LLC’s field and/or business function, e.g., “online fashion retail” or “portrait photography”
- The name and address of your LLC’s registered agent
- A list of all LLC members
- Whether the LLC will be run by a manager hired by the members, or will be managed by the members themselves
- The signature of an LLC member or manager
You must pay a $100 filing fee to submit your Certificate of Formation to the Secretary of State’s office. You must also file an annual report with the Secretary of State’s office, and pay an additional $100 yearly fee.
6. Obtain business licenses and permits
New Hampshire doesn’t require a statewide business license for LLCs. However, if your LLC engages in certain fields of business or occupations, you may need to acquire state-level licenses. The New Hampshire state government maintains a list of all such lines of business, and the New Hampshire Department of Employment Security keeps a list of all licensed occupations. Some counties and municipalities also require business licenses to operate locally. You can contact local authorities at the county or city/town level to determine what local business licenses are required where your business is located.
7. Understand New Hampshire tax requirements
New Hampshire is famous for its special tax environment. The state notably does not levy any income tax on residents. This would cover income LLC members derive from their businesses. There is also no sales tax applied to goods sold in New Hampshire. However, your LLC may be subject to other taxes, including:
- LLC-specific taxes. LLCs in New Hampshire must pay a 7.6% business enterprise tax and a 7.7% business profits tax to the state Department of Revenue Administration.
- Employment taxes. If your LLC has employees, your business will be subject to a 2.7% employer tax.
- Federal income taxes. Although New Hampshire does not apply taxes to earnings members take home from the LLC, the federal government does. The federal income tax rate ranges from 10% to 37% depending on the amount.
8. Prepare an operating agreement
An operating agreement is a document outlining how your LLC will conduct its business. Though operating agreements are not required by federal or New Hampshire law, they can provide helpful guidance for your business’s internal operations, accountability, and goal-setting. A good operating agreement usually includes:
- Your LLC’s business name and primary address
- How long you plan to run the LLC (perhaps indefinitely)
- Information on the LLC’s registered agent
- Information about the Certificate of Formation
- The business’s purpose and mission statement
- An organizational chart listing members and their respective investments
- How profits and losses are divided between LLC owners
- The process for admitting new members and offboarding outgoing ones
- An overall management plan
- Various indemnification and liability provisions
9. Examine business insurance options in New Hampshire
Unexpected losses can be devastating for any small business, including those in New Hampshire. While LLCs offer some personal-asset protection in the event of debts or legal claims made against your business, you may still want to purchase insurance to protect non-covered property. Standard policy packages available in New Hampshire include:
- Workers’ compensation insurance. New Hampshire state law requires that all businesses with employees, even part-time employees, purchase workers’ comp—an insurance package covering injuries or illnesses workers may suffer on the job.
- General liability insurance. General liability insurance provides broad coverage for your business related to losses due to lawsuits from accidents, injuries, or negligence connected to the company or occurring on company property.
- Commercial property insurance. Commercial property insurance covers some or all of the costs associated with repairing or replacing lost or damaged company property. It can cover costs associated with things like fires, weather damage, or even theft.
- Professional liability insurance. Professional liability insurance protects businesses that provide certain expert services, usually in fields like law, accounting, or real estate—this is also known as “malpractice insurance.”
- Cyber liability insurance. Data breaches and ransomware can harm your customers and tarnish your LLC’s reputation. Cyber liability insurance covers those times when your business incurs losses resulting from informing customers of an attack, compensating them in case of a claim, and/or paying for credit monitoring for those impacted.
The Small Business Administration maintains a list of forms of insurance your New Hampshire LLC may need.
10. Understand financial considerations
LLC startup costs might include renting an office, storage, or retail space, commissioning a professionally designed website, or paying for advertising, equipment, and/or software. You may also want to hire professionals, like lawyers and accountants, to support the business. Because these costs can add up, you may be interested in accessible funding options, which lets you repay funding as a percent of your New Hampshire LLC’s daily sales. This allows payments to be tailored to how much money you’re making. You may also consider opening a business bank account or obtaining a business credit card to handle cash flow and overhead.
11. Market your LLC
Once your New Hampshire LLC is launched, it’s time to market it. Marketing your LLC allows you to reach new customers and hopefully turn them into repeat customers. A good marketing plan might include elements such as:
- Market research. Understanding your LLC’s target customer profile is key to growing your business. You can accomplish this by thoroughly researching customer profiles, competitor products or services, and industry trends.
- Advertising and promotion. You can design and place ads by yourself, in a newspaper or on a billboard, for example, or hire an advertising agency to do these things for you. Traditional paid advertising may seem a little out of fashion, but it’s still a highly effective tool for generating new business today.
- Social media. Successful businesses in the digital age must maintain a robust online presence across social media platforms—including Facebook, Instagram, TikTok, YouTube, and others. Consistently publishing content on these platforms that aligns with your brand identity can garner significant visibility and customer engagement.
- Public relations. Developing strong relationships with press in New Hampshire and even with national and foreign outlets may bring more attention to your LLC.
- Customer retention. Building genuine, personalized relationships with customers is one way to turn them into repeat customers. You might do this by leveraging your marketing materials, digital tools, and social media presence to forge authentic connections with consumers.
Starting an LLC in New Hampshire FAQ
How much does it cost to form an LLC in New Hampshire?
Starting an LLC in New Hampshire costs, at a minimum, $100 to file a Certificate of Formation, plus $15 if you’d like to reserve a business name ahead of time. There is also an additional $100 associated with filing your required annual report.
Do you need a New Hampshire registered agent for your LLC?
Yes, all LLCs in New Hampshire must appoint a registered agent to receive legal documents and other official correspondence. You can appoint an individual (such as an employee) or a service, but in either event they must be available during normal business hours at an in-state physical address.
How do LLC state taxes work in New Hampshire?
Although LLC members are not subject to state income tax in New Hampshire, LLCs are subject to certain special taxes, including a business enterprise tax and a business profits tax.