How to form an LLC in Indiana

Indiana Secretary of State charges $95 online (or $100 by mail) to file Articles of Organization. The biennial report is $32 every 2 years. Realistic year-one cost: $95. Ongoing cost: $32 every 2 years (effectively $16/year averaged) — making Indiana one of the cheapest large states for LLC maintenance.

Online filings through INBiz approve in roughly 1 business day. Mail filings take 5–7 business days. Indiana does not offer a separate paid expedited tier.

No annual report — Indiana uses a biennial (every 2 years) Business Entity Report instead. The fee is $32 online or $50 by mail. The first report is due in the LLC's second anniversary month.

No franchise tax. Pass-through LLCs pay no state-level entity tax. Owners pay personal income tax (flat 3.05%, dropping further) on their share of LLC profits.

Yes. Indiana has no residency requirement for LLC members or managers. You only need an Indiana-based registered agent. Out-of-state owners commonly use a commercial registered agent service.

Yes — particularly for Indiana residents and businesses tied to manufacturing, logistics, life sciences, or RV/automotive industries. The flat 3.05% income tax (one of the lowest), $32 biennial report, no franchise tax, and 1-day online filing make Indiana exceptionally cost-efficient long-term.

Indiana has a flat 7% state sales tax with no local add-ons — one of the simplest sales tax systems in the U.S. If you sell taxable goods or services, register with the Department of Revenue through INBiz. Use tax also applies to out-of-state purchases used in Indiana.

Indiana does not have a state-level general business license. Specific industries (real estate, contractors, food service, professional services) require state licensing through the relevant board. Some larger cities (Indianapolis, Fort Wayne) require local registration.

Indiana LLCs are pass-through entities by default, meaning profits flow to members and are taxed on personal returns rather than at the entity level. Indiana imposes a flat 3.05% individual income tax rate on LLC income reported by members, along with county income taxes that vary by location and typically range from 0.5% to 2.9%. If your LLC has employees, you must register with the Indiana Department of Revenue for withholding taxes and with the Department of Workforce Development for unemployment insurance. LLCs electing to be taxed as corporations pay Indiana's 4.9% corporate income tax instead. Most Indiana LLCs also collect and remit sales tax at the standard 7% rate if selling taxable goods or services.

Yes, Indiana imposes no residency requirement on LLC members or organizers, so anyone — including foreign nationals — can form an Indiana LLC by filing Articles of Organization with the Indiana Secretary of State and paying the $95 fee. Non-residents must designate an Indiana registered agent with a physical street address in the state to receive legal correspondence on the LLC's behalf. If the LLC conducts business in your home state, you will also need to foreign qualify that Indiana LLC in your home state, which typically requires a separate filing fee and ongoing compliance in that state. Members who are non-residents of Indiana are still subject to Indiana income tax on income derived from Indiana sources. Keeping a separate business bank account and maintaining your operating agreement will help demonstrate the legitimacy of the entity regardless of where you live.

Indiana does not issue a general statewide business license, so forming your LLC with the Secretary of State is not the same as being licensed to operate. Depending on your industry, you may need a professional or occupational license from the relevant Indiana state agency — for example, contractors license through the Indiana Professional Licensing Agency or a food handler permit through the Indiana State Department of Health. County and city governments, such as Indianapolis-Marion County, often require local business licenses or zoning permits that you must obtain separately from state registration. If your LLC collects sales tax, you must register for a Registered Retail Merchant Certificate with the Indiana Department of Revenue at no cost. Always check both state and local requirements before you begin operations to avoid fines or forced closure.

To voluntarily dissolve an Indiana LLC, members must first approve dissolution according to the procedures in your operating agreement or Indiana's default LLC statutes under IC 23-18. You then file Articles of Dissolution with the Indiana Secretary of State online through INBiz; the filing fee is $30 and processing typically takes one business day. Before or alongside filing, you should wind up the LLC's affairs — paying outstanding debts, notifying creditors, liquidating assets, and distributing remaining funds to members. Indiana does not require a formal tax clearance letter before dissolution, but you should file a final state tax return with the Indiana Department of Revenue and close any tax accounts to avoid future penalty notices. Keep copies of the dissolution paperwork for at least seven years in case creditors or taxing authorities raise issues later.

An Indiana LLC is usually the better choice for small businesses, freelancers, and real estate investors because it offers liability protection with far less administrative overhead — no required board meetings, no mandatory officers, and simpler record-keeping than a corporation. Indiana corporations must file Articles of Incorporation ($90 filing fee), hold annual shareholder and director meetings, and maintain detailed minutes, while LLCs have no such statutory requirements beyond the biennial report. Corporations become more attractive when you plan to seek venture capital or issue stock options to employees, since investors and equity compensation plans work more naturally with corporate share structures. Both entity types pay a $31.20 biennial report fee to the Indiana Secretary of State. If you are unsure, most Indiana small business owners start as LLCs and can convert to a corporation later if the need arises.