How to File an LLC in Alaska

There are many opportunities when building a business in Alaska. Business owners can choose C corp or S corp structures, although they’re not ideal for small businesses. A sole proprietorship is another option that simplifies many aspects of starting and running a business. Still, it can expose personal assets to risks during company-related legal battles.

An Alaska LLC offers the best of both worlds. You can retain more freedom, like a sole proprietorship, while gaining liability protection like that of a corporation.

Key Takeaways

• An Alaska LLC is the best bet for a prospective small business owner in the state, providing the freedom and flexibility of a sole proprietorship and the liability protection of a corporation.

• Alaska doesn’t require owners to reserve their business name before starting the business formation process. However, it is strongly recommended that you do so to ensure your name is available.

• The Alaska Department of Commerce doesn’t require you to create an LLC Operating Agreement, but doing so is strongly recommended to help iron out how your business will operate.

What Is LLC Formation?

A limited liability company protects the owner and their partners. Commonly abbreviated as LLC, this structure prevents personal assets from being used to repay company debts. There are extreme scenarios and exceptions where the protection may not apply.

An LLC is a hybrid business structure known as a pass-through entity. It combines elements of a sole proprietorship and a corporation. Therefore, it may still need to pay sales tax and state fees when submitting the formation documents. But the business entity won’t be subjected to paying a business tax.

In addition to the liability and tax benefits of this type of business structure, entrepreneurs choose LLCs to gain more freedom to run their businesses. There are no predefined or state-mandated corporate structures to follow or shareholder demands. Owners can structure the internal management however they see fit and benefit from investors’ capital injections.

Unlike most states, there’s no such thing as an Alaska Secretary of State that oversees business formation. Entrepreneurs must deal with the State of Alaska Division of Corporations, Business, and Professional Licensing to form an LLC and pay state fees. This is a Department of Commerce, Community, and Economic Development branch.[1]

Should You Form an LLC in Alaska?

Every business structure has pros and cons, whether it’s an LLC, sole proprietorship, or corporation. Understanding them will help determine if an Alaska LLC is the legal business entity for you.

Here are some of the benefits:

• Personal assets are better protected and very rarely subject to claims

• LLC owners can create flexible management and ownership structures

• A multi-member LLC and a single-member LLC are equally easy to form

• Pass-through taxation means LLCs don’t pay income taxes, only their members and owners 

• LLCs have fewer regulatory guidelines to contend with

Of course, there are a couple of downsides to consider regarding an LLC formation:

• Some entrepreneurs may struggle to form an LLC

• Transferring ownership in an LLC is complex when compared to S and C corporations

• LLCs must file additional documents such as an initial and biennial report 

• A standard LLC name must contain the words limited liability company or an accepted abbreviation

Step-By-Step Guide To Starting Your Alaska LLC

If you want to form an LLC in Alaska, the process differs slightly from other states. Alaska doesn’t have a Secretary of State; the Department of Commerce handles all business registrations. Secondly, the paperwork varies based on various considerations.

However, the following step-by-step guide shows how to do everything, from naming your LLC to appointing a registered agent to pay the filing fees associated with the business structure.

Step 1: Choose a Business Name for Your LLC

Only a few entrepreneurs realize that choosing an LLC name is one of the most challenging aspects of organizing this business structure. Not only is the business name supposed to be unique, but it must also make sense. It’s more than an identifier for the Department of Commerce. It’s also a name that helps solidify your brand in the marketplace.

That’s why adopting a four-stage process is the best way to avoid most challenges of forming an LLC for the first time.

Stage 1 — Search for Name Availability

Imagine using a business name like “Premium Alaska Fishing Equipment Servicing, LLC.” The Department of Commerce would accept it provided it’s available. But it doesn’t have the ring of a high-end brand until you drop the “LLC” and adapt it slightly. This is a trade name or doing business as a name (DBA).

There are three characteristics you must consider when naming your LLC:

• Alaska LLC name and DBA name availability

• Relevance for your brand

• Potential trademark infringement

None of your names can be an exact match or similar to those used by another company in Alaska. It’s essential to use the Corporations Database of the Department of Commerce to ensure you can use the name you want.[2]

Unfortunately, you can’t search for a company’s DBA similarly. That’s easier to do using your favorite web browser.

Stage 2 — Find and Register a Domain Name

Getting a domain name isn’t a prerequisite to obtaining authorization to do business in Alaska. However, having a domain name and a website makes perfect business sense. Over 70% of people research a company or brand before buying from them. And most of that research is done online instead of via phone, trade shows, etc.

Therefore, conducting a domain name search is something you can do while figuring out your DBA. A quick Google search can tell you if other businesses already use the same name you want to use in Alaska.

Alternatively, you can use a domain registrar like GoDaddy, Bluehost, Domain.com, and others. Searching for an available domain name in a registrar’s database lets you quickly snag the name for your company if it’s up for sale. However, it would be best to refrain from buying until the Alaska Department of Commerce lets you use your LLC name.

Stage 3 — Reserve the Business Name

There are two reasons to reserve your business name, even though the state of Alaska doesn’t require it. First, you want to ensure you can buy your desired domain name as soon as you find one to keep it relevant to your LLC name. Secondly, reserving the LLC name prevents others from using it for up to 120 days.[3]

Therefore, you can take more time and sort out all other paperwork before filing your formation documents. This can include finding a registered agent, discussing the LLC formation with other members, etc.

There are two forms you need to know about:

• The New Business Name Reservation form costs $25 to file. It reserves the name for 120 days while you handle the company organization process.

• The Business Name Registration form costs $25 to file and gives exclusive rights to the DBA name for five years. However, this can only be filed by a company with an Alaska business license.

You can mail the documents to the following address, if you don’t want to file online:

Department of Commerce, Community, and Economic Development

Corporations Section

P.O. Box 110806,

Juneau, AK 99811-0806

You can also use this street address to drop off the paperwork in person:

State Office Building

333 Willoughby Avenue, 9th Floor

Juneau, AK 99811-0806

Stage 4 — Get Trademarks for Your Brand

Getting your Certificate of Organization and being able to conduct business in the state won’t protect your LLC name. Other companies can still infringe on it, and you must defend it in court. Moreover, it won’t protect your DBA and other trade names, logos, and similar identifying brand marks..

Getting trademarks for your brand to establish a solid legal recourse against potential infringement is crucial.

The Department of Commerce, Community, and Economic Development reviews and accepts trademark applications. It’s best to consider searching for similar registered marks with the State of Alaska and the U.S. Patent and Trademark Office. Hiring a specialized attorney is also a good idea.

Alaska trademark registration costs $50 in state fees per single class of goods or services.[4]

Step 2: Fill Out Alaska Articles of Organization

Finding the right name can take longer than filing the Articles of Organization to make your LLC official in Alaska. State law requires filing the form to maintain your good standing and get your authorization to do business in the state.

Luckily, the forms are easy to complete and submit with the proper authorities. But depending on where you are from, you may need to submit a domestic or foreign version of the LLC formation document.

Filing for a Domestic LLC in Alaska

You must file the Articles of Organization Domestic Limited Liability Company form to organize your LLC in Alaska as an Alaska business owner. You must also pay the $250 filing fee, which is more expensive than in most states.[5]

Here is some of the information you must include in the form:

• The LLC business name using the term “limited liability company” or abbreviations like “LLC,” “L.L.C.”

• The purpose of organizing the company

• The Alaska registered agent’s name and address

• The management structure (manager-manager or member-managed)

• Signatures of organizers, if necessary

You may also fill out the credit card payment form and expect to hear back within 10 to 15 business days from the Department of Commerce Corporations Division.

If you don’t want to file Articles of Organization online, you can mail the document to the following address:

Department of Commerce, Community, and Economic Development

Corporations Section

P.O. Box 110806,

Juneau, AK 99811-0806

Remember to also file your Initial Report after submitting the Articles of Organization.

Filing for a Foreign LLC in Alaska

A foreign LLC is a business entity previously organized in a different state or country. You can apply for a foreign LLC Certificate of Registration to conduct business in Alaska.

This form differs slightly from the Articles of Organization but is still easy to complete and file. Here’s some of the information requested:

• The legal name of the LLC, containing the appropriate LLC abbreviation

• The assumed name or DBA

• The company’s purpose and the NAICS Industry Grouping Code for your area of activity

• The home state and date of incorporation of your company

• The registered agent’s name and address

• The principal office physical address and mailing address

• The management and ownership structure

• Contact information

• Credit card payment information

Unlike a domestic LLC formation, foreign incorporation costs $350 in state fees. And you can mail your Certificate of Registration paperwork to the same address:

Department of Commerce, Community, and Economic Development

Corporations Section

P.O. Box 110806,

Juneau, AK 99811-0806

Step 3: Hire an Alaska Registered Agent

Having an Alaska registered agent is a mandatory requirement for an Alaska LLC. Without one, you can lose good standing with the Alaska State Department of Commerce and risk business dissolution. Furthermore, not naming an agent in your formation documents can result in your application’s denial.

Luckily, you have many options for a registered agent. Alaska residents over 18 can serve as your registered agent, as can an LLC’s owner or company officers. Moreover, Alaska registered agent services can handle your legal correspondence and keep you compliant.

An Alaska registered agent has several key responsibilities:

• Processing legal documents like the service of process notices

• Maintaining a registered office, a physical street address to accept documents on your behalf.

• Keep regular business hours

But before you name a registered agent in the Articles of Organization or Certificate of Registration forms, you must get their consent. Registered or resident agents can’t process documents on your behalf unknowingly.

Why Should You Consider a Registered Agent Service?

Being your own registered agent can be tempting when forming a domestic LLC. You can save a few dollars and gain possession of legal documents directly.

But outsourcing the role offers significant advantages:

• You have more flexibility with your schedule and can keep irregular business hours

• You don’t have to make your office address public

• You don’t have to open physical offices in Alaska

• You won’t receive service of process notices or other sensitive documents during client meetings

These are a few reasons why using a third-party registered agent service like Swyft Filings offers privacy, compliance, and peace of mind. In addition, you get 24/7 access to your documents via a personal online dashboard and personalized assistance with regulatory issues. Contact us anytime to learn more about the Swyft Filings registered agent services.

Step 4: Create an LLC Operating Agreement

An Alaska LLC operating agreement is a beneficial contract between the members of an LLC business entity. It’s a legally binding document that defines ownership stakes, responsibilities, roles, and other details about the LLC.

The Alaska Department of Commerce doesn’t mandate this contract. Your ability to receive a business license and authorization to do business in the state has nothing to do with it. However, LLC owners benefit from the legal document whenever in-house disputes arise.

For example, you can use the LLC operating agreement to determine and formalize the management structure:

• Manager-managed LLCs give the chief LLC owner total power to create and modify the agreement

• Member-managed LLCs allow all LLC owners and members to contribute to drafting the document.

Furthermore, you can include other topics in this contract:

• Ownership stakes

• Voting rights

• Profit and loss breakdown

• Buyout plans

• Ownership transfer contingency conditions

Operating your business without an operating agreement can confuse LLC members and even subject LLCs to additional state regulations, much like an S or C corp business structure. Likewise, you may incur more personal liability by not formalizing an operating agreement, stripping some of an LLC's benefits.

Step 5: File for an Employer Identification Number and Business License

Another critical step towards organizing your LLC in Alaska is getting a federal Employer Identification Number, or EIN. It’s the last piece of the puzzle before you can operate legally in the state.

The EIN is your company’s Social Security number and the Internal Revenue Service’s unique code to identify your business. The IRS uses the EIN to determine income tax, business tax, and federal tax obligations. Additionally, your LLC needs an EIN for a business bank account and credit card.

Obtaining an EIN is usually done through the IRS website. It’s a free service with no filing fees. But you can only get your EIN after finishing the LLC formation process. Alternatively, the IRS offers the option to fax or mail the application.[6]

Additional Business License and Permit Considerations

Not all businesses can start selling their products and services after receiving their Certificate of Organization and Certificate of Compliance.

Depending on your industry and the services offered, you may need to search for applicable business licenses. The Department of Commerce website has an extensive database you can search for relevant licenses and permits.

Furthermore, you can also check for potential tax exemptions, endorsements, and veteran discounts. You will only benefit from them if you identify what applies to your LLC and file the correct paperwork. Lastly, note that some business licenses may need to be renewed after a year or predefined periods of inactivity.[7]

Let Us Handle Your LLC Paperwork

An LLC formation isn’t too complicated but it is time-consuming for most entrepreneurs. Even organizing a small business can force you to do many things simultaneously. Fortunately, the filing aspect of your formation documents is easily outsourced.

All you need is an LLC formation service with experience and regulatory knowledge.

The Swyft Filings team has helped over 250,000 businesses since 2015 and is still going strong. Our LLC formation service can help organize your Alaska LLC correctly, keeping in line with all compliance aspects involved.

If you want to know more, contact our team and learn about our personalized Alaska LLC formation service.

FAQs

How much does it cost to set up an LLC in Alaska?

Alaska charges domestic and foreign LLCs differently. Domestic business entities pay $250 in state fees on top of trademark, domain name, and other expenses. Foreign LLCs pay $350 in state fees on top of additional costs.

How is an LLC taxed in Alaska?

An Alaska LLC is a pass-through entity. Therefore, it may have a sales tax but not a business tax. The taxes are passed through to the LLC members.

What are the benefits of an Alaska LLC?

An Alaska LLC has similar liability protection to a corporate business structure and similar management flexibility to a sole proprietorship or partnership. LLCs take the good elements of multiple business structures while limiting the risk associated with each of them.

How do you dissolve an LLC in Alaska?

Dissolving a domestic LLC in Alaska requires filing the Articles of Dissolution form with the Department of Commerce, Division of Corporations. You can do it via mail or file it in person. A foreign LLC must file a Certificate of Cancellation. While this won’t dissolve the LLC it will place it in a withdrawn status. Both documents cost $25 in filing fees.

Bibliography

1. State of Alaska Division of Corporations, Business and Professional Licensing. “Articles of Organization.” Accessed January 29, 2023.

2. State of Alaska Division of Corporations, Business and Professional Licensing. “Search Corporations Database.” Accessed January 29, 2023.

3. State of Alaska Division of Corporations, Business and Professional Licensing. “Corporations – New Business Name Reservation.”  Accessed January 29, 2023.

4. State of Alaska Division of Corporations, Business and Professional Licensing. “Corporations – Trademark Registration.” Accessed January 29, 2023.

5. State of Alaska Division of Corporations, Business and Professional Licensing. “Articles of Organization.” Accessed January 29, 2023.

6. Internal Revenue Service. “Business and Self-Employed – How to Apply for an EIN.” Accessed January 29, 2023.

7. State of Alaska Division of Corporations, Business and Professional Licensing. “Business Licensing.” Accessed January 29, 2023.