How to Form a Hawaii LLC
By Bazal Razzaq
Updated: August 24, 2023, 12:30pm
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- Select a name for your Hawaii LLC
- Draft a business plan
- Hire a registered agent
- Prepare and file Articles of Incorporation
- Create an Operating Agreement
- Obtain the nine-digit EIN (federal employer identification number) from the IRS
- File your Statement of Information annually
- Final Word
- How To Form An LLC In 50 States
- Frequently Asked Questions (FAQs)
With perks like a strong small business focus, global appeal, and central Pacific location serving as a bridge between the United States and Asia, who wouldn’t wanna form a Hawaii LLC? It doesn’t matter whether your LLC plans on benefitting from the Aloha State’s thriving economy or you’re aiming for a beautiful environment coupled with an amazing quality of life; our comprehensive guide will help you understand all there’s to know while creating an LLC in Hawaii!
#1 Select a name for your Hawaii LLC
Before you begin the formation process, selecting a name for your Hawaii LLC is extremely necessary.
Here are some basic naming requirements for an LLC in Hawaii:
- The LLC name should be distinguishable from existing business names registered with the Hawaii Department of Commerce and Consumer Affairs (DCCA) Business Registration Department. You can also check if your chosen LLC name is available or not on the Hawaii business name database.
- It should also include an appropriate indicator of its limited liability status, such as,
- Limited Liability Company
- Limited Company
- LLC(Most entrepreneurs stick with this one)
- Avoid using certain words related to regulated industries (like “bank,” “insurance,” and “doctor”), as they may require additional approval or documentation.
- Your name shouldn’t include any obscene, vulgar, or forbidden words.
- Remember that words that could confuse your LLC with a government agency (like “FBI” or “Treasury”) are generally not allowed.
For a complete list of naming rules in Hawaii, you can also read Hawaii’s Naming Guidelines.
If you do have a legally compliant name in your mind but aren’t ready to kick start your LLC just yet, there’s always an option to reserve it. You can submit an application for Reservation of Name with the Business Registration Division. You have the option to either file online or by mail. The business name registration fee is just $10.
Note: Remember that you’re under no obligation to use your legal business name(one that’s mentioned in your Articles of Organization document) in the real world. You have the option to use a Trade Name or Fictitious Name, more popularly known as a DBA (doing business as).
You simply need to register your trade name with the Hawaii Department of Commerce and Consumer Affairs. Again, you have the option to register online or by submitting the Application for Registration of Trade Name (Form T-1) via postal mail. The filing fee is $50. It’s important to note that registration isn’t mandatory and doesn’t grant ownership rights, but it does serve as a public notice of your claim over the name.
Lastly, it’s always best to consult with legal professionals or the Hawaii DCCA for the most accurate information regarding the naming requirements for an LLC in Hawaii.
#2 Draft a business plan
A business plan is like a roadmap for your business. It’s basically a document that explains what your business is about, how you’ll make money, who your customers are, and how you plan on reaching them. It also lays out your goals and the steps you can take to achieve them.
Here’s what you can include in your business plan,
- Mission statement of your LLC
- A brief summary
- A proper list of your products and services
- Financial plan
- Marketing and Sales Strategy
- Funding Request
- Operational Plan
- A logistics and operations plan
The more your business plan is compact, structured, and tailored to your specific business, the better it is for your Hawaii LLC. Remember that a solid business plan helps you secure funding from investors and serves as a strategic tool to guide your LLC toward success.
#3 Hire a registered agent
Like every other US state, Hawaii also requires a registered agent to accept and receive all legal, official, and financial documentation and notices on behalf of the LLC. It can either be an individual or business entity and is basically your business’s point of contact with the state.
You have the following options when it comes to choosing a statutory agent for your Hawaii LLC:
- Be your own registered agent.
- Another business entity.
- Hire a registered agent service.
- An individual within the company(manager/employee/member)
- An Attorney, lawyer, or legal facility.
To be a registered agent for a Hawaii LLC, one should:
- Have a physical street address in Hawaii.
- Be a resident of the state.
- Be at least 18 years old.
- Have the legal authority to accept legal documents on behalf of the company and forward them to the appropriate parties within the company.
- Be available during regular business hours to receive legal documents.
- Consent to act as the LLC’s registered agent.
Note: A PO Box is not sufficient as a business address.
#4 Prepare and file Articles of Incorporation
To formally register your Hawaii LLC, you need to file your Form LLC-1: Articles of Organization document with the Hawaii State Department. You can do this online or download the form and send it through fax, mail, or in person. The state filing cost is $50, which is payable to the State of Hawaii and is nonrefundable, plus the state archive fee, which may or may not be refundable.
The mailing address is,
Department of Commerce and Consumer Affairs
Business Registration Division
335 Merchant St.
PO Box 40
Honolulu, HI 96810
The office address is,
335 Merchant St.
Honolulu, HI 96813
You typically need to include the following details in your form:
- The name and business address of your LLC.
- Name, address, and contact details of your LLC’s registered agent
- Names, addresses, and contact details of all LLC’s organizers
- Duration of LLC (if not perpetual)
- The management structure: member-managed or manager-managed
- Management information
- Names and addresses of initial managers (if Manager-managed) or initial members (if Member-managed)
- Will the members/owners be liable for debts
- Effective date
- Filing Fee
- Any additional provisions like ownership percentages or voting rights.
- Signature of LLC’s organizer.
After filing, the State authority will review your document. Once they confirm, your LLC will officially be a legal entity.
#5 Create an Operating Agreement
A well-drafted operating agreement ensures that all LLC members/owners are on the same page regarding business decisions, finances, and operations. It reduces the risk of future conflict, misunderstandings, and confusion between the co-owners and makes the whole journey a lot easier.
While an agreement is not really mandatory in Hawaii, you should have one in place if something goes wrong sometime in the future.
Here are some basic points you can include in your operating agreement,
- LLC name, address, and contact information
- Members/owners’ names and contacts
- Planned duration of the LLC in Florida
- Registered agent’s name and address
- Article of Organization details
- Business goals and mission
- Contributors and their shares
- Ownership, voting, and profit details
- Profit/loss sharing plan
- Adding/removing members process
- Managing the LLC and decisions
- Dissolution terms
- Indemnification and liability clauses
#6 Obtain the nine-digit EIN (federal employer identification number) from the IRS
An EIN is like a Social Security Number(SSN) for taxation purposes. It’s used to identify your business entity for tax purposes and keep track of your business’s tax reporting.
You can get an Employer Identification Number for free from the IRS (Internal Revenue Service. You can submit your form online through the IRS website or download the form and then mail it to the address below,
Internal Revenue Service
Attn: E.I.N. Operation
Cincinnati, OH 45999
Fax: (855) 641-6935
Do you even need an EIN?
Well, you need it if your LLC plans on,
- Hiring employees
- Opening professional business bank accounts
- Applying for business licenses and permits
- Meeting federal and state tax obligations
- And generally smoothly conducting day-to-day business operations
#7 File your Statement of Information annually
Like most US states, LLCs in Hawaii must file an annual report(just another name for a statement of information) with the Department of Commerce, which helps update your business information with the state.
There are multiple names you can use to address an annual report; some of them are,
- Yearly Report
- Annual Statement
- Annual Financial Report
- Year-End Report
- Annual Review
- Yearly Summary
- Annual Performance Report
- Yearly Financial Statement
- Yearly Overview
- Annual Company Report
The cost for filing a hard copy is $15, whereas the fee for online filings amounts to $12.50.
You need to submit a report every year. The time to submit it is based on the quarter of the month when your company was created. Let’s say your company started on April 15th. You should send the report between April 1st and the latest date of June 30th each following year. You don’t need to submit a report in the first year your company was formed.
Remember that if you fail to submit your report due to any reason, you’ll be charged with a $10 yearly penalty and, finally, the dissolution of your Hawaii LLC if you don’t file it for two years straight.
Finally, after forming your Hawaii LLC, don’t sit back and relax just yet but instead, focus on properly complying with the state authorities.
You can follow the steps below:
- Get needed permits and licenses, like health or zoning permits and pro licenses.
- Register with the state’s tax agency.
- Open a business bank account.
- Get a business credit card.
- Buy business insurance.
- Safeguard your name and logo with a trademark.
Collectively, forming and running an LLC in Hawaii can be an easy and adventurous process with the correct direction and guidance. Once you gain a proper understanding of the above steps involved, you can successfully form and maintain a limited liability company in the state.
Frequently Asked Questions
A registered agent is a person or entity responsible for receiving legal documents on behalf of your LLC. In Hawaii, having a registered agent is mandatory for LLCs to ensure important communications are properly received.
Your LLC’s name must be unique and distinguishable from existing business names in Hawaii. You can check the availability of your desired name through the DCCA’s online business name database.
Articles of Organization are official documents that establish your LLC with the state. You can file them online or by mail with the DCCA. The articles typically include basic information about your LLC, such as its name, address, and management structure.
While not required by the state, having an operating agreement is recommended for LLCs in Hawaii. This document outlines the ownership, management structure, and operating procedures of your LLC.
Yes, Hawaii LLCs must file an annual report and pay a filing fee to the DCCA to keep their status in good standing. The annual report provides updated information about your LLC.