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How to File an Alabama LLC Certificate of Formation

A lot goes into the conception and planning of a new business. It is the Certificate of Formation that will make the LLC in Alabama official. Being prepared before sitting down to complete the application will help you finish it efficiently.

First, have all of the required information handy. You will be asked for the following information:

  • Name of the Alabama LLC
  • A copy of the Name Reservation Certificate
  • The name and mailing address of the registered agent
  • The name(s) and signature(s) of the organizer(s)
  • Your AL Entity ID number (Provided on Name Reservation Certificate)

Second, the Certificate will be filed with the Probate Judge in the county where the LLC will be located. The cost of filing the Certificate of Formation is a minimum of $150, so have a credit card or check ready to go. The fees are as follows:

$100 – Standard processing

$200 – Expedited processing

$50 – Minimum Probate Judge fee

Some judges do not accept credit cards or handle expedited processing. Always call the Probate Judge in your county to learn the specifics. If using a check, it is payable to the Alabama Secretary of State.

Finally, processing time varies depending on which option you choose. If you’re in a hurry, the expedited processing option, which will process within 24 hours of the date of receipt, might be a good choice. Standard processing will typically take 3-5 business days. However, during heavier processing times, it can take as long as 14 business days. The payment and certified copy of the Certificate will be sent to the Alabama Secretary of State within 10 days of filing.

 

Filing Options

When filing the Certificate of Formation, use one of the three methods below.

Mail

For a hardcopy of the application, click here. The original application, two copies of the application, a copy of the Name Reservation Certificate, and payment can be mailed to the Office of the Judge of Probate in the county where the LLC will be located.

In Person

For a hard copy, click on the link above. The original application, two copies of the application, a copy of the Name Reservation Certificate, and payment can be brought in person to the Office of the Judge of Probate in the county where the LLC will be located.

Online

As of early 2019, three counties process applications online: Jackson, Montgomery, and Baldwin. The state is in the process of getting the remaining counties online. Check with the Probate Judge in your county for more information.

The filing date is effective immediately on the date that the Certificate is filed by the Probate Judge. You do have an option to delay the filing, but it must be filed within 90 days that the Certificate application is signed.

 

Want Help Filing Your Certificate of Formation?

If you decide to use your time building your business rather than completing paperwork, but don’t want to spend the money on an attorney, an LLC formation service is a great compromise.

Lots of services are out there but do vary in perks offered, processing times (theirs, not the state’s), and price.

In general, a service will collect and review your information, prepare the documents, and send them to the Office of the Judge of Probate in the appropriate county. They will contact you when the Certificate of Formation has been filed.

One additional benefit offered by some services is a free year of registered agent service. Others offer order tracking or notifications of future legal requirements needed with the state.

After reviewing all the top LLC creation services available, we found IncFile and Northwest Registered Agent the best overall options. While neither of them have as high brand power as the industry giant, LegalZoom, both services have great customer support, prices and offer a free registered agent in Alabama.

 

(Post Formation Checklist) After LLC Formation

After you have filed the formation documents with the state, it’s important not to overlook a few critical details.

Taxes and Reporting

On the federal level, most LLCs do not pay taxes directly to the government. Instead, they report income and losses on the owner’s personal 1040 tax returns. Schedule C is often used for reporting. Unless the LLC chooses to be taxed as a corporation, a single-member LLC is taxed as a Sole Proprietorship and a multi-member LLC is taxed as a Partnership.

In Alabama, all LLCs are required to file a Business Privilege Tax Return and Annual Report with the Department of Revenue on or before three and a half months after the beginning of the LLC’s taxable year.

A separate form ( Form BPT-IN) is needed for the first return which is due two and a half months after the LLC has organized.

The returns can be sent to one of the following addresses:

If not making a payment, send your return, Form BPT-V to:

Alabama Department of Revenue

Business Privilege Tax Section

PO Box 327431

Montgomery, AL 36132-7431

If you are making a payment, mail your return and payment to:

Alabama Department of Revenue

Business Privilege Tax Section

P.O. Box 327320

Montgomery, AL 36132-7320

Licensing

A business privilege license and in some cases, a store license or municipal business license are needed before a business can begin operations. The business privilege license is issued by the County Probate Judge or License Commissioner in the county where the business is located. The license runs from October 1 through September 30, and needs to be renewed in October annually.

The store license applies to businesses where either retail or wholesale merchandise of any kind is sold.

The Municipal Business License is similar to a professional license. It applies to businesses that involve a particular occupation. The list can be found here. Requirements and fees vary according to the license.

In addition, local governments may require additional licenses and permits.

When all of the mechanics of setting up an LLC in Alabama have been completed, someone like Fanny can get down to the business of setting up a website or creating a logo.