LLC Passive Airbnb

How to Incorporate An LLC For Your Airbnb Business In 5 Minutes or Less

How to Incorporate An LLC For Your Airbnb Business In 5 Minutes or Less

I would not recommend incorporation if you are not taking this business venture seriously. It is only for those who are more serious about committing to a lifestyle that is financially rewarding while maintaining the freedom to travel more.

Another key benefit is that the LLC will make you look more official. Most landlords prefer to work with a person who’s taken serious steps to incorporate. Finally, most property management companies will not work with you unless you have two years worth of business “credit history.”

How do you start building a business credit history? Well, you’ve guessed it.


Let’s talk about the mindset and the pros and cons of incorporation. Then I will show you how to actually get incorporated in 5 minutes or less.

Generally speaking, there are two types of mindsets when it comes to incorporation: reactive vs. proactive. You should decide which approach you will want to cultivate. It’s not only useful in business, but in life as well. Generally speaking, a proactive mindset is more productive.

Incorporate An LLC: The Proactive Mindset

This is where you decide to take on an active approach to how you envision your business venture. You are taking a proactive measure to mitigate against uncertainties that may happen to your business in the future. The benefit of being proactive is that if there was a lawsuit, you would be better protected under an LLC or an S-corp.

Incorporate An LLC: The Reactive mindset

This is where you simply failed to take on the proactive mindset and you have to react to an immediate uncertainty that might force you to incorporate. Essentially, you are putting out a fire.

There are pros and cons to why you should incorporate. In this blog post, I want to walk you through my experiences and thoughts on why I decided to incorporate before I started my Airbnb Arbitrage business and the mistake that I’ve learned.

Incorporate An LLC: The Do it Yourself Way

There are two ways to get incorporated: do it yourself or outsource it to a third-party software company. I used the latter approach. However, if you’re interested in doing it yourself, then check out this link. It’ll give you a step-by-step approach to getting incorporated.

Note: it takes a lot more work to do it yourself. You might even wonder if you did it right. For a couple of hundred dollars, you can easily outsource this task more efficiently and put your mind at ease.

Helpful Tip: If you need your corporation or LLC formed in a hurry, you can pay the state an expedite fee for a faster turnaround. Some states even have instant online filings.

Incorporate An LLC: The Other Way

At the end of this blog, I hope you’ll get to avoid a mistake that cost me $800 dollars if I had just waited 12 days later to incorporate. The process I’m about to show you will take you less than 5 minutes. Take out your timer and let’s begin.

Step 1 – Find a Name for Your Business

LLC Passive Airbnb

The first step to incorporating your business is making sure your business’ name is available for use. Fortunately, all 50 states have online databases where you can search for the availability of your proposed name. This search can be found on the secretary of state’s website.

For example, California Secretary of State is

Once you’ve landed on the site, run searches until you find a name someone else hasn’t taken (hopefully, you don’t need to run more than one search).

Helpful Tip: Most secretaries of state websites offer or make it sound like you need to reserve your business name. You don’t need to reserve the name. In fact, reserving the name may even slow down the formation of your business entity, as you’ll be required to provide proof that you reserved the business name—a process that is known for being confusing, even to the government agencies requesting the proof of ownership.

Step 2 – SwyftFilings

There are so many companies online offering the same services. Just to name a few: Swyftfilings, Incorporate, Incfile, and a few others. Most of these companies are competitive and based on my research, these 3 companies are the best out of a dozen.

I chose Swiftfilings because of two reasons:1) I found that their sign-up process to be the easiest, and 2) their customer service absolutely rocks! Their customer service always came through when I had questions.

If you’re forming a corporation, the governing documents are called bylaws. For LLCs, the documents are known as operating agreements.

I decided to incorporate as an LLC, but please do your own research to see what is best for you before you incorporate. I also want to mention that I am not a lawyer, so I don’t know what is best for you in your current situation. Again, this is why it’s important for you to do your own research on which type of incorporation is best for you to reduce taxes.

The Process to File Online

Incorporate An LLC

Choose your type of incorporation and the state that you’re filing it in. From my experience, it’s the easiest if you were to file it in your own state. I reside in California, so I chose California.


Incorporate An LLC

Pick a package that works best for you. I chose “Standard” because I didn’t really need a lot of features that “Premium” offered. There’s also nothing wrong with “Basic” package. 😉


Incorporate An LLC

Fill out the required information. Make sure you’re giving your birth name because this will be filed with your state officially.

Incorporate An LLC

This is where your previous research comes in handy.


Incorporate An LLC

Do not worry about giving all the details. You’ll need to give an overview of what you’re planning to do.


Incorporate An LLC

I used my home address as my business address. It’s okay not to have a business address for now and you can change it later. PO boxes might work for some states, but California doesn’t allow that.


Incorporate An LLC

My LLC will be managed by me. If you have partner or partners, then this is where you fill out their information.


Incorporate An LLC

You are required to have a registered agent. But if you have a CPA, then this is where you opt out and enter your CPA’s address as your registered agent.


Incorporate An LLC

I opted out because you’ll have to do research into your own city/town’s regulations on STR.


Incorporate An LLC

This is a free webinar, so I would just get in and learn. However, they will try to upsell you later on. In my experience, it’s best to find a local CPA that is more familiar with your local laws and taxes.


Incorporate An LLC

It’s nice that they give a payment plan option. I paid it in full.

The $800 Dollars Lesson

Incorporate An LLC

Fill out your payment information and you’re done!

If you’re in California, then this lesson will apply to you. If you’re in some other state, then perhaps this lesson will also be equally true. I incorporated on December 16th of 2016. Because I incorporated in 2016, I had to pay the California Franchise Board $800 dollars in order to maintain my legal status as an LLC. I talked to my CPA and he told me that if I had waited just 12 days, I wouldn’t have to shell out $800 dollars.

The Lesson?

LLC Passive Airbnb

Always incorporate in the new year! It’ll save you some money.

How was that? Did you take out your timer and time the whole process?

If you need help with filing, please give SwyftFilings a try. You will not be disappointed in how easy it is.


Sign up now and receive 5 mini-lessons to get you started. This training is absolutely FREE. Click Here to learn more about how you can leverage other people’s properties to build a 6-figure business on Airbnb.

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