How to Start an LLC in Rhode Island (RI LLC 2024)

How to Start an LLC in Rhode Island: If you’re looking to start a Rhode Island LLC, you’ve come to the right page. Setting up an LLC is easy and cost-effective. To form an LLC, you must follow a few steps that include naming your LLC, hiring a registered agent, filing your formation documents, doing the operating agreement, and finally obtaining the EIN. You can easily set up your LLC at a very low cost in Rhode Island. Though, you must pay the mandatory state filing fee. These fees and charges can be tax deductible, making the LLC formation cost almost negligible.

On this page, You’ll find all the steps that must be taken to ensure that your Rhode Island LLC has been correctly formed. We recommend you read the whole article very carefully, word by word, don’t miss anything 🙂

How to Start an LLC in Rhode Island

An LLC (aka Limited Liability Company) is a hybrid business entity combining a corporation’s characteristics with a partnership or sole proprietorship. It separates your personal assets from your business assets, thus giving you personal asset protection. For an LLC, members’ personal assets are not affected by business debts. However, in some cases, if the LLC is sued for business debts, courts might pierce the corporate veil and use the owner’s personal assets to meet their corporate liabilities.

If you wish to start an LLC in Rhode Island, you must file your Articles of Organization with the State and pay a filing fee of $150. While it’s the most important step, it’s not the only one. There are 4 other crucial steps to follow to get your LLC formed in Rhode Island. Below are all 5 steps that explain everything you need to do to start a Rhode Island LLC in 2024. Let’s get started! You can always hire a professional LLC formation service in RI to set up your LLC instead of doing it alone; a Pro service will ensure everything is done properly.

Step 1: Decide a Name for Your Rhode Island LLC

The first step while forming a limited liability company in Rhode Island is to give a proper name to your LLC. Before you name your business, you must know that the name should be easy to remember, available in the state, and follows all the LLC naming guidelines.

Rhode Island LLC Naming Guidelines

There are a few specific requirements all the LLCs in Rhode Island have to follow while naming their Company. Some of the most important requirements are as follows:

• “Limited Liability Company”, “LLC”, and “L.L.C.” – any one of these has to be used as a suffix in your business name.
• You cannot use any name for your business that is confusing or misleading. Terms such as “Treasury”, “State Department”, “FBI”, “CIA”, etc. shouldn’t be included.
• Terms like “Bank“, “University“, “Attorney“, “Doctor“, etc can be added only after the additional requirements by Rhode Island State Government are fulfilled.
• (Optional) It’s better to name your business something for which your desired domain is available.

Important Links –	Submit Offline Form to –
Rhode Island Business Entity Search – Online Name Search Name Reservation Form – PDF Name Availability Standards – Guidelines Rhode Island LLC Name Search – Instructions	Office of the Secretary of State Corporations Division 148 W. River Street Providence, Rhode Island 02904-2615

Reserve Business Name for Future

If you do not wish to file your LLC right now but want to hold the name you have decided on, then you can reserve your LLC name for 120 days. To keep the name, you must file a name reservation application and pay $50 to reserve your name with the Rhode Island Secretary of State. An additional $2.50 fee should be paid for online filing.

Doing Business As (DBA) or Trade Name

Once you have a legal name for your LLC, you can register it. However, it is not mandatory. You can, instead, use DBA, Fictitious Name, or Trade Name. In that case, you must register your name with the Rhode Island Secretary of State by submitting an Application to Register a Trade Name in Rhode Island along with the filing fee of $10.

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Step 2: Assign a Resident Agent in Rhode Island

The second step to forming an LLC in RI is to appoint a Resident Agent (also known as a Registered Agent in most states). A Resident Agent is a person or business entity working on your LLC’s behalf. This person or business will receive important tax forms, legal documents, all notices of lawsuits, and other official government correspondence in Rhode Island. Hence, hiring a competent Rhode Island Resident Agent for your LLC is necessary.

Make sure your registered agent is a resident of Rhode Island or has a physical street address. This address will be used as the principal address of your LLC to receive any legal documents. Most LLC formation companies also provide registered agent services. Below are two great LLC formation services; even if you buy their cheapest plan (normally $0), you also get registered agent service and other services at a very reasonable price.

These two are our top recommendations for registered agent service, as they are competent and authorized to conduct business in Rhode Island. Some LLC formation services also offer standalone Rhode Island registered agent services. You can purchase only Registered Agent services without purchasing any other LLC formation services. This standalone service might become handy if you are doing it yourself and don’t want to disclose your home address or you don’t want to pierce the corporate veil.

Registered Agent Consent Application

In Rhode Island, there is no separate Consent Letter to be produced to the Secretary of State. At the time of change of Registered Agent (or the name or address), the new Registered Agent has to sign the consent letter. It comes with the Application form to Change the Registered Agent. The filing fee of $10 should be paid for it. For more information on the same, read our guide on Rhode Island Registered Agent.

Step 3: File Articles of Organization in Rhode Island

The third and most important step in forming a Rhode Island LLC is to file the Articles of Organization. This Rhode Island Articles of Organization is a legal document that is required to register your business with the Rhode Island Secretary of State. It costs $150 (by mail and $208 online) to file your formation certificate in Rhode Island.

The Articles of Organization include details like the name of the LLC, the registered agent’s name, address, employees’ details, and the structure of the company (member-managed or manager-managed). Before hiring employees in Rhode Island LLC, one should know about the rules and regulations thoroughly. Also if you are expanding your existing business (an LLC) in other states to Rhode Island, you must register as a Rhode Island Foreign LLC.

Processing Time: Normally, it takes around 5-7 business days (approx) to get your LLC formed in Rhode Island. The processing time for online filing might be a little faster than offline filing. With an additional cost, you can get expedited filing as well. However, the document processing time can be changed due to various factors.

Every LLC owner has to pay the filing fees to register their business in Rhode Island. This fee is mandatory but also tax deductible. If you’re doing it yourself (filing on your own), it will not cost you any additional service fee. However, it is not feasible to do that as the DIY process might be delayed, complicated, and messy, especially if you’re a novice entrepreneur. Hence, it is recommended to get professional guidance to get your LLC formed in Rhode Island.

Step 4: Create Your Rhode Island LLC Operating Agreement

Moving on to the fourth step, filing your operating agreement. An operating agreement is a document that legally outlines the proprietorship and operating procedures of your LLC. For an LLC with a spouse, you must need an operating agreement for that. This document is vital as it ensures that all business owners are on the same page regarding how they operate, thus reducing future conflicts.

When it comes to filing a Rhode Island LLC Operating Agreement, the state does not require you to have a comprehensive operating agreement, but it is ideal to have one that contains all the details of your business operation that helps in taking future business decisions, especially if you decide to dissolve Rhode Island LLC later. Hence, having an operating agreement may not be necessary, but it is surely ideal.

The operating agreement draft can be created for free if you don’t hire a professional. However, there is an advantage to appointing a proficient person/service. You will get a businesslike quality operating agreement at a very cheap fee, which will help you in the future. Hiring a professional service means you can sleep well at night 🙂

Step 5: Filing a Rhode Island LLC EIN

The Employer Identification Number (aka EIN) is a nine-digit number given by the Internal Revenue Service (IRS) to make it easier to identify the type of business for tax purposes and taxes in general. The EIN is necessary for any active business or any form of business.

An EIN number in Rhode Island is needed when the LLC hires employees. Hiring employees in Rhode Island LLC requires following specific rules and regulations. On the other side, EIN for Rhode Island foreign LLC should be obtained if your LLC is based in other states.

To obtain EIN (aka FEIN), one must fill up a form (Online or by mail) and submit it to the IRS. Enter details of your LLC, and finally, complete the form and send it to the address given. You can also get an EIN Assistant to help you with the process.

Mail to: Internal Revenue Service, Attn: EIN Operation, Cincinnati, OH 45999

Fax: (855) 641-6935 | Fee: Free

Note: You don’t need a Social Security number when getting an EIN. You can proceed to fill out I.R.S. Form SS-4 and leave section 7b blank. You must then call the IRS at (267) 941-1099 to complete your application. Agents or employees will help you with that.

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Congratulations, you are now done with all the necessary steps to form your Limited Liability Company in Rhode Island. If you do it yourself, it should take you a long time to understand and do all the steps properly.

However, if you use ZenBusiness, it should be way faster. You will always have a live chat option and phone support with experts for any help you need. Their worry-free service will make things easier for you.

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After Starting Your Rhode Island LLC

After forming your LLC, there are still some things that you will need. The most important thing is to separate your business and personal assets. LLCs have limited liability protection that protects your personal assets from business liability. This is called a corporate veil. However, the corporate veil can be lifted or pierced by the court if the LLC is sued. In that case, the owners of the LLC become personally liable for their corporate debts. A few things like appointing a legit registered agent, having enough capital, and filing all the major documents with the state can save the LLCs from being pierced into the corporate veil.

Apart from that, there are a few things you need to take note of,

• Get a company business bank account.
• File Rhode Island business permits & licenses
• Get general liability insurance and professional liability insurance with coverage for employees.
• File a Rhode Island LLC annual report or biennial report

This page has provided you with steps to LLC formation and filing processes. You now have to remember upcoming filing deadlines and filing fees or filing costs, including fees for late filings to make sure your LLC is up-to-date.

The LLC formation processing time in Rhode Island is 3-4 business days if filing offline or online. Check how long it takes to form an LLC to know about the tentative timelines.

Cost of Rhode Island LLC

LLCs can be formed by spending very less price, considering its pass-through tax structure. Apart from the mandatory state filing fees, you don’t have to bear additional service charges if you do it yourself. Following are the fees and taxes LLCs in Rhode Island must pay to register and run a business in the state. Forming an LLC is no doubt cost-effective compared to other business structures. However, the fees and charges (tax-deductible) that you must pay to the state, such as name reservation fee, name filing fee, LLC filing fee, and Franchise Tax & Sales Tax (If applicable). Here are the main fees and taxes you must pay while forming your limited liability company in Rhode Island,

Fees/Tax	Amount to be Paid
Name Reservation Fee (online)	$50
Name Reservation Fee (By mail)	$52.50
Certificate of Formation Fee	$150 (by mail and online)
LLC Annual Fee	$50
Sales Tax	7%

In Rhode Island, an LLC name reservation is not mandatory. You can register your LLC name at the time of registering your LLC. If you wish to hold the name for some time without registering your LLC, then you can do that online. Your LLC name will be reserved for 120 days without registering your LLC. It can be done by paying $50.

In Rhode Island, an Annual Report has to be produced every year. It costs $50. Also, the State of Rhode Island requires LLCs to pay a Sales Tax of 7% every year. Read our guide on LLC costs in Rhode Island for more information.

Rhode Island Foreign LLC

If you are interested in forming a Foreign LLC in Rhode Island then you need to file the Certificate of Foreign LLC to the Rhode Island Secretary of State. Foreign LLCs allow you to operate your business in more than one state. Along with the Certificate of Foreign LLC, you need to submit some more documents like the Certificate of Good Standing, etc. to the Rhode Island SOS to form your foreign LLC in Rhode Island. To know more in detail, check out our guide on Rhode Island Foreign LLC.

Reasons to Start an LLC in Rhode Island

If you look at Rhode Island’s insights, it is one of the smallest states in the USA but has large opportunities for businesses. Industries are established in the state and are thriving well due to the business environment and incentives offered. So, if you are also willing to start a Rhode Island LLC, here are some of the benefits the state government offers to their LLC start-ups.

Incentives for Small Businesses

Any new Rhode Island LLC that is starting up as a small business will be eligible for plenty of incentives and tax benefits provided by various government entities. A glimpse of some of them is shown below.

• Any capital gained by the small business will be excluded from the taxation list for some time to invest more in strengthening their foundation. Also, many modifications are to be made in the company’s structuring, for which some amount is to be paid to the government. A business is also exempted from these taxes. Read more on Rhode Island’s classification of LLC tax.
• Some specific activities are listed by the Rhode Island state government and clarify that if the LLCs follow these activities, they will enjoy some tax credit.

Small Business Loan program

In Rhode Island, small businesses are liable for 98.9% of the state’s income. That is why the government started a special loan program named Small Business Loan Fund Program. It ensures that any small business looking to level up should not miss an opportunity due to a money crisis. The maximum capital one can derive from the loan is $500,000, which is more than sufficient for carrying forward any expansion-related activity.

Innovation Network Matching Grant

The INMG program is designed for LLCs in Rhode Island that is medium to small in size. The key industries to whom these grants are provided the healthcare, food and agriculture, life sciences, etc. These businesses are considered essential for running human life, and that is why the incentives are provided to such businesses on the tax they file with the state government.

Best Businesses in Rhode Island

To form an LLC in Rhode Island, you need to gain complete knowledge of the smallest state’s businesses. Several businesses are well flourishing in the state, but only a few have contributed hugely to its GDP. Here is the list of those top 3 businesses

Tourism Industry

One of Rhode Island’s most prominent players, tourism, provides jobs to 50,000 people of such a small state. The state’s total contribution to the country is around $5.75 billion, and the reason behind this is the top-class tourism spots in the state. There are many historical monuments in the state with a long 400 miles of seashore.

There is a place named Benefit Street, which is most popular in the state, and people love to stay around that place due to its artistic and intellectual centers.

Manufacturing sector

The textile mills and jewelry businesses of the state are very famous around the country. For a very extended period of time, the jewelry businesses of the state are also known as the world’s jewelry capital. The jewelry is focused on the inexpensive yet beautiful stones that are procured from the seashore easily.

Other than jewelry, there are some production houses for electrical appliances also in the state. All of these businesses have combined contributed an amount of $4.65 billion to the state’s GDP.

Fishing and Agriculture

Due to the long seashore present in the state, the businesses related to fishing activities are thriving well. A vast mackerel market, cod, striped bass, etc., fishes due to its commercial demand. The state is also dependent on its agriculture sector for milk, sweet corn, and potato. The overall contribution of both these sectors is around $.12 billion.

Some small businesses that are working goof in the state are:-

• Special cultural food businesses
• Custom jewelry shop
• Fabricated metal products business

Rhode Island LLC Formation Review

F.A.Qs

In Conclusion

When it comes to forming an LLC in Rhode Island, it is much simpler than other business structures. In Rhode Island, starting a small business or a start-up is easy because of its diverse resources. For small budget holders, forming a limited liability company is desirable. The steps explained in this article are generic steps for starting a business in Rhode Island. It is recommended to consult an attorney or service provider.

In Rhode Island, while establishing an LLC, make sure you check with the local bodies like the city council and district office to get updated with local regulations. We recommend ZenBusiness, one of the best LLC services that offers LLC formation at $0 (+ state filing fees). Hiring a professional service would make things easier. From having a registered agent to complying with the local and state government, everything will be smoother than doing things all by yourself.