If you own a business in Arkansas, you might be asking how often you need to renew your LLC. Yes, you do, is the quick response. All LLCs in Arkansas are obliged to submit an annual franchise tax report to the secretary of state of the state. This report and a $150 payment are both required to be submitted by May 1st each year.
A franchise tax receipt is documentation demonstrating that your LLC has paid the state of Arkansas its yearly franchise tax. Because it is necessary in order to conduct business in the state, this receipt is significant. Your LLC might not be able to create a commercial bank account, apply for company licenses or permits, renew professional licenses, or even operate without a legitimate franchise tax receipt.
LLCs in Arkansas could be charged a corporate income tax in addition to the franchise tax. In Arkansas, the current corporate income tax rate is 6.5 percent. However, LLCs that choose to be taxed as pass-through organizations, such as single-member or multi-member LLCs, are exempt from paying corporate income tax. Instead, these LLCs transmit their profits through to the individual members, who are then in charge of filing their own personal tax returns to pay taxes on their respective portions of the income.
Several variables, including whether you choose to hire an attorney to assist you with the process, whether you require any business licenses or permits, and whether you decide to hire a registered agent to receive legal documents on behalf of your LLC, can affect how much it costs to form an LLC in Arkansas. However, the minimal filing cost in Arkansas to create an LLC is $50.
If your LLC is based outside of Arkansas but you intend to conduct business there, you may need to register it with the Secretary of State’s office there. A foreign LLC, or one that was founded in another state, is required by Arkansas law to register with the Secretary of State if it is “doing business” there. This can involve things like having a physical presence in the state (such a building for an office or a shop), employing people there, or even closing deals with clients there.