Form Your LLC in Pennsylvania for Free With Tailor Brands

With over 500k businesses benefitting from its services, Tailor Brands has become a trusted platform for LLC formation and brand-building solutions. What's more? It helps businesses form their limited liability company for free.

Start Your LLC Today

Quick and Easy Formation Process

Tailor Brands offers free LLC formation services, where the only expense required is the necessary state filing fee.

You'll get customizable plans and ongoing customer support to meet the specific needs of your business.

The team simplifies the LLC formation journey by guiding you step-by-step, ensuring necessary legal compliance.

Things to Know Before Forming an LLC in Pennsylvania

The Commonwealth State, Pennsylvania, has some interesting regulations for those who want to form an LLC there.

Here’s everything you need to know before you start an LLC in Pennsylvania:

  • The personal income tax rate for LLCs (since they enjoy pass-through taxation) is 3.07%. With corporations, the tax rate is 9.99%. For C-corps it’s charged on net corporate income and for S-corps it’s on built-in gains.
  • Unlike in other states, you do not need to hire a registered agent to receive your official documents on your behalf. Pennsylvania provides a list of Commercial Registered Office Providers that you can select for this role.
  • If you wish to reserve an LLC business name in Pennsylvania, it will cost you $70. So if you’re not ready to use your business name yet, you can have it reserved for up to 120 days by paying the required state filing fee.
  • Please note that Pennsylvania charges a 6% sales tax on LLCs selling taxable items. An additional 1% local tax is charged for every item purchased, used, or delivered to Allegheny and 2% for Philadelphia.

This next section contains a guide to help you form an LLC in Pennsylvania.

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Name Your Pennsylvania LLC

The first step towards creating an LLC in Pennsylvania is making sure your business name isn’t already taken. You can do this for free on the Pennsylvania Department of State Business Search website. Tailor Brands offers this in its paid package.

Ensure your Pennsylvania LLC name contains the word Limited Liability Company, company, or limited or the initials to each. Also, make sure the name doesn’t contain any words relating to a Corporation, such as corp, or any other restricted words.

Provide an Official Address in Pennsylvania

For your business’s legal correspondence, you’ll need to provide a physical mailing address of an office located in Pennsylvania. This could be a registered agent, although that’s not a requirement in this state, unlike most other states.

Alternatively, you can have a Commercial Registered Office Provider (CROP) receive your LLC documents on your behalf. The state provides a long list of CROPs you can choose from. You’ll need to get into a written agreement with them first.

File Your Pennsylvania LLC Formation Documents

Next, you’ll need to file your LLC Certificate of Organization (or what other states would call Articles of Organization) with Pensylvannia’s Department of State Bureau of Corporations and Charitable Organizations. This will cost you $125. 

You can file a Foreign Registration Statement for $250 to register a foreign LLC in Pennsylvania. Pennsylvania allows for the domestication of foreign LLCs for $125 to make it a domestic LLC in Pennsylvania, and foreign in your home state.

Create an Operating Agreement

While the state of Pennsylvania does not require LLCs to have an operating agreement, it’s advisable to have one. It’s a legally binding document that outlines how your LLC will be operated and what roles members will play in the LLC.

An LLC operating agreement contains details about the business, such as each member’s rights and responsibilities and their initial investments, voting rules, and procedures for dissolution, addition and departure of members, and more.

Get a Federal Employer Identification Number (EIN)

An Employer Identification Number is like your business’s social security number. It’s how the Internal Revenue Service identifies your business for federal tax obligations. So If you plan on having any employees, your LLC will need an EIN.

You can apply for an EIN on the IRS’s official website. However, this process can get difficult and tedious so most people prefer to outsource it. Tailor Brands provides this as an additional paid service making it quicker and easier.

Understand Pennsylvania State’s Tax Requirements

LLCs enjoy pass-through taxation, which means that the business income passes through to the LLC members. Members then report it on their personal income tax returns as well as their self-employment tax, which happens at the federal level.

Some LLCs are eligible for S-corp status, which helps them save on self-employment taxes. At the state level, Pennsylvania imposes state-level payroll taxes at the rate of 3.07% on taxable income, and sales taxes of 6%.

Open a Business Bank Account

You’ll need to open a business bank account to separate your personal and business assets. Mixing business and personal finances can put your personal assets at risk in case your business faces a lawsuit or if it gets into debt.

This way, you’ll be able to enjoy limited liability without question. Having a business bank account also helps make the most of your LLC income. You can open a savings account, a capital reserve, or an investment account for your business.

Research and Acquire Business Licenses and Permits

Pennsylvania provides licenses to businesses to ensure the safety and health of its citizens. Professions that require business licenses from the state include barbers, medicine board, pharmacy, real estate, engineers, cosmetology, nursing, etc.

Besides business licensing, your business may need permits depending on your city or county of operation. You’d need to check with your local authorities for zoning and permit regulations for your city or county, to find out the permits you need.

Get Business Insurance

You’ll need insurance if you plan to hire employees for your LLC. You’ll need worker’s compensation insurance to provide them with medical benefits in case of an injury or sickness and health insurance if you have over 50 full-time employees.

Another form of insurance you may consider getting if you’re offering professional services is professional liability insurance. This type of insurance covers your costs if a customer sues your business for negligence or providing subpar services.

Establish a Business Online Presence

Next, you’ll need to establish an official website to solidify your online presence. It’s not difficult to create a website, as there are numerous website-building tools out there that can help you. Tailor Brands has this service as part of its paid packages.

You’ll need an official domain name for your business and a good website hosting platform. An official website comes with official email addresses as well, that you and your team can use for your business. This all helps add to your credibility.

Market Your LLC in Pennsylvania

Once you’ve got the right documents, have your finances set up, and your LLC is up and running, you can now get the word out. Building a strong marketing strategy to reach your target audience and introduce them to your products and services.

Promote your business using different marketing tactics. Some marketing tactics you could try out include creating a social media presence, partnering with influencer marketers, offering loyalty programs, product giveaways, and more.

Stay Compliant

The state of Pennsylvania only requires restricted and benefit LLCs to file annual reports, unlike most other states. Restricted LLCs need to file an Annual Registration Report while Benefit LLCs need to file an Annual Benefit Report.

This, however, is set to change in 2025 as all states will be required to file an annual report. This will cost $7. Initially, all LLCs only filed a Decennial report every 10 years and the report needed to be filed on a year ending with ‘1’, like 2021.

Why Outsource LLC Formation Instead of Handling It Yourself

While you can handle the formation process on your own, there are too many state regulations to keep up with. As such, it’s easier to have a business formation service do it on your behalf.

Here’s why you should outsource Pennsylvania LLC formation.

Time-Saving

Save the time you would have spent scouring the internet for information on the requirements to start a business and figuring out state regulations. Instead, leave the formation to the experts and use your time to focus on scaling your business, increasing sales, etc.

Great-Support

Customer Support

Forming a business by yourself can be frustrating as you may not know who to consult if you get stuck along the way. But if you outsource, you’ll have the guidance you need to help you understand the process and deal with any challenges that come along.

Simplified Process

Outsourcing your business formation to a third party simplifies the process. The service provider will take most of the load off your back, including most of the paperwork. This way, you will only have to deal with simpler tasks, such as follow-ups, compliance, and more.

Start Your LLC with Tailor Brands

Lite Plan

If you’re looking to file your documents with the state and nothing more, this is the plan for you. Here are the services you’ll get.

  • Preparation and filing: Tailor Brands does not charge anything to file your LLC formation documents with the state. You’ll only pay the state filing fee which is constant regardless of the formation platform you choose.
  • 14 business days processing time: Once you submit your LLC application, the processing time under the Lite plan takes up to 14 business days. This timeframe allows for the standard review and filing procedures. 

If you don’t want any bells and whistles, and simply want professionals to handle Pennsylvania LLC formation for you, then this is the right plan for you.

Experts at Tailor Brands will help you start an LLC in Pennsylvania, but not offer any other add-on services, with this plan.

Price: $0

Essential Plan

The Essential package includes everything in the Lite package plus additional business support services for growing your LLC in Pennsylvania.

  • Annual compliance and updates: Tailor Brands will send you reminders for mandatory report filing and updates for your business. This service ensures your LLC stays in good standing with Pennsylvania state law.
  • Expedited processing: The Essential package offers expedited processing, reducing the formation time to just two business days. With this plan, your LLC is ready to operate in a significantly shorter timeframe.
  • Operating agreement drafting: Tailor Brands offers support in creating an operating agreement for your LLC in Pennsylvania. This document details the management structure and decision-making processes.
  • Bonus $30 Amazon gift card: As an added benefit, Tailor Brands provides a $30 Amazon gift card with this package. It’s a helpful bonus to purchase business essentials or supplies to support your venture’s launch.

Price: $199/year

Elite Plan

The Elite package is the most comprehensive, offering all Essential services plus advanced business branding and online tools.

  • 1-Year free domain & website tools: With the Elite package, you receive a free domain for one year. Tailor Brands also offers DIY websites and online store builders to help you get your brand online.
  • Unique brand logos: As part of the Elite plan, Tailor Brands helps design up to eight unique logos for your business. A professionally designed logo creates a strong brand identity and sets your business apart in the market.
  • Bonus $50 Amazon gift card: You’ll receive a $50 Amazon gift card when you choose the Elite plan. This is to help you invest in any additional supplies or resources you may need to kickstart your business.
  • Business card tools: Tailor Brands also offers digital business card creation tools. With these tools, you can design and share your professional business card online, helping you build connections and promote your brand.
  • Social media tool: The Elite plan includes a social media post maker to help you create branded content for your business’s social media accounts. This tool saves time in maintaining an active social presence.

Price: $249/year

Licenses and Permits Acquisition

As a business owner, you need to comply with various federal, state, county, and local regulations. Figuring out which permits and licenses apply to your business can be overwhelming. With this service, you can rely on experts to handle it all.

The service covers determining the specific licenses you need and obtaining them on your behalf. You can either give a report listing your required licenses for DIY filing or opt for a complete end-to-end service where they handle everything.

Licenses and Permits Acquisition
Trademark Registration

Trademark Registration

Protecting your brand’s identity is essential, and Tailor Brands’ trademark registration service can help you do that. A trademark ensures that your business’s digital assets are legally protected, keeping others from using them without your permission. 

This service simplifies the trademark process by guiding you through the necessary steps. You simply fill out a form and Tailor Brands ensures that your trademark application is properly filed with the U.S. Patent and Trademark Office.

Business Mailbox and Addresses

For privacy and professionalism, Tailor Brands offers a business mailbox service. This service gives you a professional mailing address, so you don’t have to use your home address for receiving business correspondence.

Having a dedicated business address can improve trust with customers and partners. Tailor Brands handles mail forwarding and notifications, making it easy to manage correspondence and keep your business details secure.

Business Mailbox and Addresses
Get Business Insurance

Business Insurance

Through its business insurance service, you can get in touch with trusted insurance providers who offer coverage tailored to your business needs. This way, you can safeguard your business assets and minimize business risks. 

Tailor Brands will help you determine the type of insurance your LLC in Pennsylvania needs based on its type and industry. You’ll receive recommendations on coverage options, ensuring you’re not overpaying for insurance you don’t need.

Business Banking Service

Managing your business finances starts with setting up a dedicated business bank account, and Tailor Brands helps you find the best options. This service connects you with the best banks to open an account for your LLC in Pennsylvania. 

Having a separate bank account for your LLC in Pennsylvania can help with bookkeeping. With this service, you can gather the necessary documentation and create an account for managing your business finances.

Business Banking Service
Tax Filing Service

Tax Filing Service

Tailor Brands offers comprehensive tax filing services to take the hassle out of preparing and submitting your business taxes. You will receive expert advice from accountants who understand your industry and specific tax needs.

The process is simple and efficient. You schedule a tax consultation, during which you’ll receive instructions on how to submit your tax documents. The team will review your paperwork and ensure everything is filed accurately before the deadline.

Personal Limited Liability

This business structure protects your personal assets in the event that your business gets sued or is in debt. An LLC offers similar protection as a Corporation, though not as extensive. The state treats your business as a separate legal entity.

Your LLC can handle its own lawsuit expenses and pay its own debts. However, unlike Corporations, Limited Liability Companies enjoy liability protection without having to deal with numerous formal requirements or double taxation.

LLC-Formation

No Registered Agent Needed

The Commonwealth state does not need businesses to have registered agents like most other states. This does not mean that you shouldn’t have one. It means that you’ll have options. You only need to provide a registered office address.

The state provides a list of offices on its official website that you can use for your correspondence. Once you get into a contractual agreement with a commercial registered office provider (CROP), they can act as your “registered agent”.

Favorable Filing Fees

Pennsylvania annual report filing fee is affordable. According to the new law that took effect in 2022, Pennsylvania LLCs will be required to file their annual reports from 2025. Traditionally, only restricted and benefit LLCs filed these reports.

The rest of the LLCs filed decennial reports (every 10 years) for $70. Now, annual reports will cost $7 every year for LLCs. This filing fee is much more affordable compared to most other states where charges are higher than $50.

Fewer Restrictions

Unlike C-Corporations, LLCs have fewer restrictions imposed on their operations. For instance, C-corps need to file numerous formation paperwork to be considered legal, while LLCs only file a single application with the state for the same recognition.

Also, LLCs get the freedom to decide how their business is operated, how they choose managers, and how they designate responsibility. They have no rules regarding annual meetings and they can have as many members as they want.

Management Flexibility

Pennsylvania has no rules as to who should manage the LLCs. This decision is left entirely to the owners. This includes choosing between a single-member LLC or a multi-member LLC—either owned and managed by a single person or more people.

Members also have the option of having member-managed LLCs or manager-managed LLCs. Owners can either manage their business themselves or appoint a manager to do it on their behalf. Corporations do not enjoy this flexibility.

Increased Credibility

It’s easier to build your credibility as an LLC in Pennsylvania than it is to do so as a Sole Proprietorship. Business entities with this structure are viewed as more structured and formal, and this gives them an advantage when seeking funding.

In Pennsylvania, your business will be required to adopt the words LLC or limited liability company and this adds to its positive outlook. As a result, the people you transact with will know right away that you’re a structured business.

Frequently Asked Questions (FAQs)

Filing for a Certificate of Organization for a domestic limited liability company in PA costs $125. If during filing you decide to acquire a fictitious name or a Doing Business As (DBA), you will pay $70 for registration. Name reservation also costs $70.

Foreign LLCs have different charges for formation in Pennsylvania. Registration for a foreign LLC will cost $250 unless the foreign LLC wants to be domesticated. In this case, the fee is similar to that of forming a domestic LLC ($125).

Restricted professional LLCs pay at least $500 for registration in Pennsylvania.

Some benefits of forming an LLC in Pennsylvania include

  • Personal limited liability: Just like with Corporations, this business structure protects your personal assets if your business gets sued or is in debt. An LLC is treated as a separate legal entity and has its own legal rights.
  • No registered agent needed: Pennsylvania does not need businesses to have a registered agent. They provide a list of commercial registered office providers (CROPs), that can act as your “registered agent”.
  • Favorable filing fees: The Pennsylvania annual report filing fee is affordable. They charge an annual filing fee of $7 every year for LLCs. The fee is affordable compared to most other states that charge $50 and higher.
  • Fewer restrictions: Unlike Corporations, LLCs have fewer restrictions imposed on their operations. For instance, C-Corps need more complex formation paperwork and have more ongoing compliance requirements.
  • Management flexibility: There are no rules as to who should manage LLCs. The owners can manage their business themselves or appoint a manager to do it. Corporations and Partnerships do not enjoy this level of flexibility.
  • Increased credibility: It’s easier to build your credibility as an LLC than it is to do so as a Sole Proprietorship. Business entities with this structure are viewed as more structured and formal, which gives them an advantage when seeking funding.

Pennsylvania Corporations and LLCs both cost $125 to register.

Pennsylvania LLCs are subject to a 3.07% income tax rate while corporations get taxed 9.99% corporate net income tax. Some cities also impose their own local income taxes.

For instance, Philadelphia charges 3.87% personal income tax on residents and 3.44% on non-residents. Besides that, there are a few general differences between LLCs and Corporations. 

For instance, forming a Corporation requires loads of paperwork that go beyond the state level, while LLCs are simpler to form.

Single-member LLCs are only required to pay the standard 3.07% income tax. LLCs that choose to be taxed as C-corps pay 9.99% corporate net income tax. 

LLCs that elect S-corp status are also subject to the same rate as C-corps but only on their built-in gains. Their shareholders,  however, are only subject to the 3.07% personal income tax on their paychecks.

Online filings in Pennsylvania take between 5 and 6 weeks in general. Applications filed by mail take up to 8 weeks, which is longer because of the time your documents are in the mail. 

Expedited filings are available at extra costs. For one-hour filings received before 4 pm, you’ll pay $1,000. 3-hour expedited filings received before 2 pm cost $300 while same-day services cost $100.