How to Form an LLC in Hawaii | 2025 Guide

Hawaii is home to over 139,000 small businesses, accounting for more than 99% of all businesses in the state and employing nearly half of the private workforce¹. Many of these businesses choose to form Limited Liability Companies (LLCs) for the legal protections and tax flexibility they offer.

If you're looking to join Hawaii’s thriving entrepreneurial community, this guide will walk you through how to form an LLC in Hawaii, covering everything from filing Articles of Organization to securing your Hawaii Tax ID number and staying compliant with annual requirements.

Whether you're a local or planning to register from out of state, Hawaii’s streamlined process through Hawaii Business Express makes it easy to launch and grow your company. We'll also discuss the Wise Business account. The global account that can help your company with all things cross-border.

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How to Start an LLC in Hawaii (Step-by-Step)

Step 1: Choose a Name for Your LLC

Your LLC’s name must meet Hawaii’s naming guidelines. It must:

• Include “Limited Liability Company” or abbreviations like “LLC” or “L.L.C.”
• Be distinguishable from other registered businesses in Hawaii.
• Avoid words that imply it's a government agency (e.g., FBI, Treasury).

Check name availability through the Hawaii Business Express portal². You can optionally reserve a name for 120 days for a $10 filing fee.

Step 2: Appoint a Registered Agent

When you form an LLC in Hawaii, you're legally required to designate a registered agent—a person or company responsible for receiving legal documents, state correspondence, tax notices, and any official service of process on behalf of your business.

Your registered agent must meet the following requirements:

• Be an individual resident of Hawaii or a business authorized to operate in the state.
• Maintain a physical street address in Hawaii (P.O. boxes are not accepted).
• Be available during regular business hours to receive important legal or government documents.

You have two options:

• Serve as your own registered agent: If you live in Hawaii and are comfortable using your home or business address for public records, you can list yourself.
• Hire a commercial registered agent service: This is a good option if you live out of state, want more privacy, or prefer to avoid missing important paperwork. These services typically cost between $100 and $300 per year and often include compliance reminders and document scanning.

Step 3: File the Articles of Organization

To legally create your business entity, file the Hawaii Articles of Organization (Form LLC-1)³ with the Department of Commerce and Consumer Affairs. DCCA’s business registration division handles this process and will issue a certificate once your filing is approved.

The standard filing fee is $50, plus a $1 state archive fee. Most online filings are processed within 3 to 5 business days, while mail filings may take longer.

Step 4: Create an Operating Agreement

Although not required by Hawaii law, definitely consider creating an operating agreement. This internal document outlines the ownership structure, member duties, profit sharing, and more. It helps reduce disputes and legitimizes your LLC’s operating procedures.

Step 5: Get a Federal Tax Identification Number (EIN)

The next step is to obtain a Federal Tax Identification Number, also known as an Employer Identification Number (EIN), from the IRS. This nine-digit number functions like a Social Security number for your business and is essential for tax and banking purposes.

Your Hawaii LLC will need an EIN to:

• Open a business bank account in your LLC’s name, keeping personal and business finances separate.
• Hire employees and comply with federal payroll tax requirements.
• File federal business income taxes, especially if your LLC elects to be taxed as an S corporation or C corporation.
• Apply for business licenses or register for state-level taxes, including Hawaii's General Excise Tax (GET).

The EIN is free and easy to obtain directly from the IRS⁴.

Step 6: Register for Hawaii Tax ID Numbers

If your LLC sells goods or services, you must register for a Hawaii Tax Identification Number. This includes the General Excise Tax (GET), which applies to nearly all business activities in the state.

File the Basic Business Application (Form BB-1)⁵ with the Hawaii Department of Taxation to receive your state tax ID. You can file online via Hawaii Tax Online.

What Are the Business Requirements for a Hawaii LLC?

Once your LLC is up and running, you’ll need to meet several ongoing business requirements:

• Annual Reports: They are due each year by the end of the quarter in which your LLC was formed. The fee is $15, or $20 if filing by paper.
• Hawaii Tax Compliance: You must collect and remit the General Excise Tax (GET), typically 4%, plus possible county surcharges.
• Licensing: Some businesses may need additional permits or professional licenses depending on the industry.
• Business Debts: Keep your business and personal finances separate by maintaining a dedicated business bank account to protect liability limitations.

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Once you have established your business with an LLC, you’ll need a business account to manage your US finances. A Wise Business account is easy to open online and comes with no monthly fees. You can convert funds from your home currency to USD with low, transparent fees.

Wise is not a bank, but a Money Services Business (MSB) provider and a smart alternative to banks. The Wise Business account is designed with international business in mind, and makes it easy to send, hold, and manage business funds in currencies. You can get major currency account details for a one-off fee to receive overseas payments like a local. You can also send money to countries.

Some key features of Wise Business include:

Major local account details to receive international payments with ease No monthly account fees just a simple one-off fee for account details Receive payments from e-commerce platforms such as Amazon or via Stripe. Create invoices using the Wise invoice generator or invoice templates. Accounting integrations, including a QuickBooks Bill Pay connection. Bill payments will be synced, matched, and categorized in QuickBooks for simple reconciliation. Access to BatchTransfer. Fast payment of up to 1,000 people.

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What Are the Benefits of Starting an LLC in Hawaii?

Hawaii offers several advantages for LLC formation:

• Limited Liability Protection: Your personal assets are shielded from business-related debts and lawsuits.
• Pass-through Taxation: Profits are passed through to members and taxed at their personal income rates.
• No State Sales Tax: Hawaii uses the General Excise Tax (GET), which applies broadly but can be advantageous depending on your business structure.
• Simple Compliance: Annual reports are inexpensive, and filing is streamlined through Hawaii Business Express.
• No Residency Requirement: Neither members nor managers need to live in Hawaii.

How Much Does It Cost to Start an LLC in Hawaii?

Here’s a breakdown of expected startup costs:

Expense	Cost
Articles of Organization	$50
State Archive Fee	$1
Name Reservation (optional)	$10
Registered Agent Service (optional)	$100–$300/year
Annual Report	$15
General Excise Tax Registration	Free (Form BB-1)
EIN (IRS Tax ID)	Free
Operating Agreement (if drafted)	Varies

Can I Open an LLC in Hawaii Without Living There?

Yes, nonresidents of Hawaii can form and operate an LLC in the state. You’ll need a registered agent with a Hawaii address and must comply with all state tax and licensing requirements.

Can a Nonresident Open a Company in Hawaii?

Absolutely. Foreign nationals and non-U.S. residents can start an LLC in Hawaii. There is no citizenship requirement. However, you must:

• Have a U.S.-based registered agent.
• File through Hawaii Business Express.
• Obtain an EIN from the IRS.
• Stay compliant with Hawaii tax laws, including the General Excise Tax.

Comparison with Other States

Feature	Hawaii	California	Nevada	Texas
Formation Fee	$50	$70	$75	$300
Annual Report	$15	$20	$0	$0
Franchise Tax	No	Yes	Yes	Yes
Sales/Excise Tax	GET (4–4.5%)	7.25% sales tax	6.85% sales tax	6.25% sales tax
Foreign LLC Ownership Allowed	Yes	Yes	Yes	Yes

Hawaii stands out for its low formation and maintenance costs, making it budget-friendly for startups. However, its General Excise Tax (GET) applies broadly to all business income, even for service-based businesses.

California offers unmatched market access but burdens LLCs with high taxes, strict compliance, and an annual franchise tax.

Nevada appeals to businesses seeking privacy and no state income tax, though ongoing costs like the annual list and business license fees add up.

Texas has no personal income tax, but it imposes a high formation fee and a franchise tax on most revenue-generating entities, making it less ideal for lean startups.

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FAQs About Hawaii LLCs

Are There Privacy Protections for Hawaii LLCs?

Hawaii LLC formation documents do require listing the organizer’s name and registered agent, but you can retain privacy by using a third-party registered agent or legal service to mask your personal address.

Why Do People Use Hawaii for LLCs?

Entrepreneurs choose Hawaii for LLC formation because of its low fees, efficient online systems, and the predictability of the General Excise Tax. The state also supports remote filings and allows non-resident ownership, making it ideal for digital-first businesses.

Is a Hawaii LLC Tax-Free?

No. While there’s no state income tax on unincorporated businesses per se, your LLC is still subject to the General Excise Tax and may owe federal income taxes depending on how you elect to be taxed through the IRS.

Before you can legally transact business in Hawaii, you must register your entity with the state and meet all local tax obligations.

What Are the Disadvantages of a Hawaii LLC?

While Hawaii offers many benefits for small business owners, there are a few downsides to consider when forming an LLC in the state:

• The General Excise Tax applies to gross receipts, not net profit.
• Limited privacy due to public filing requirements.
• Required annual reports create a recurring compliance step.
• Potential local licensing complexities depend on the industry you are in.

Conclusion

If you're ready to protect your personal assets and legitimize your business, forming an LLC in Hawaii is a smart move. You can file everything online through Hawaii Business Express, and the low startup costs make it easy to get started. Just be sure to keep up with your annual reports, pay your General Excise Tax, and handle any local licenses your industry might require.

Learn How to Form an LLC in State
Alaska
Alabama
Georgia
Florida

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Sources:

1. Small Business Profile: Hawaii – SBA Office of Advocacy (2024)
2. Hawaii Business Entity Search
3. Hawaii LLC Formation Forms – Department of Commerce & Consumer Affairs
4. Apply for an EIN – IRS
5. Hawaii Department of Taxation – General Excise Tax Forms