How to Start a Food Truck LLC

July 27, 2022

How to Start a Food Truck LLC

Your Food Truck Business

How do you start a food truck LLC?

If you want to start a food truck, you must legally register your food truck with a specific business structure. This will entitle you to start your food truck business.

You have various options to register your business within your state, but in this post, we’ll focus primarily on starting a food truck LLC.

So, if you have a passion for your food truck and cooking, but are a little unsure of the business side of things, keep reading. Our hope is to clarify the fundamental questions of what it takes to open up the food truck business of your dreams.

Start a Food Truck LLC

Setting up a Food Truck LLC is one viable option for food truck operators and owners to get their business off the ground in a given jurisdiction.

As mentioned earlier, you have different options for legally setting up your food truck business. For example, you can create one of several business structures that may work for your food truck, which we list below. But first, let’s talk about what an LLC is – and why you might need a Food Truck LLC.

What is an LLC?

A “Limited Liability Company” is one business structure that can be legally formed for your business. Essentially, it creates a separate legal entity apart from you as a person.

This separation allows you a bit of professional insulation from business activities. In other words, creating a separate business will enable you to breathe a little easier as the burden of your entire business rests not with you but with the business itself. In addition, this “limited liability” helps to protect your personal assets from things like debts or perhaps civil judgments that may have occurred through the course of your business.

There are single-member LLCs and LLCs for partnerships with more than one member. Additionally, you will have the option to establish your LLC as an S-Corp. While not in the scope of this article, an S-corp is a particular business tax classification. I should note that not all people or businesses qualify as an S-corp LLC.

Does Your Food Truck Need an LLC?

Yes. Your food truck needs an LLC – or another business structure to operate legally in the United States. While your preferred design may not need to be a limited liability company, your food truck must still be registered as a legal business structure. The type of structure you choose is a matter of preference due to tax considerations, investor wishes, or the kind of business operation you intend to run.

Is setting up an LLC hard?

No. Setting up an LLC is often relatively easy and painless. Most states allow you to establish your LLC online. You can also quickly renew your LLC online or by mail.

Are there Other Options for a Food Truck?

Yes, you have various other options to set up a business structure. While there are plenty of reasons why you might choose to establish and operate an LLC for your food truck, other options exist. Other everyday business structures include:

Corporation
Partnership
Non-Profit Organization
Sole Proprietorship
Limited Liability Company*

*We’ve included LLC as a list because there are a couple of general ways to open an LLC for tax purposes. This includes having a single-member LLC or an LLC as an S-corp. Both have benefits that you’ll want to look at.

Further Reading: Benefits of Starting a Food Truck

Are there Particular Benefits to Setting Up a Food Truck LLC?

Yes, starting a food truck LLC has a variety of benefits.

First, it allows you to operate as a legal business entity in your state. Your business structure, like others, opens the door for you to get your business licenses, open a business bank account, get an EIN and hire employees.

Second, it protects you from certain general liabilities that may occur in the natural course of doing business.

Third, an LLC provides enormous flexibility that other business structures can’t always offer. This includes the ease of maintaining your LLC. For example, you must annually submit your LLC filing and provide a nominal renewal fee to keep your LLC. You can have one-member LLCs or multiple-member LLCs.

Once established, an LLC also provides the credibility you need to work with other partners, stakeholders, and vendors. They will be more willing to do business with you if you already have an established business.

Do I need a lawyer to set up a Food Truck LLC?

While you can use a lawyer or an online legal service to establish your LLC, you can also do the setup yourself online. For example, if you can set up an Instagram account, you have what it takes to set up an LLC.

Most states make it easy.

Typically, you will first have to choose a name for your business, appoint a registered agent, and file your articles of incorporation with your state. In addition, you may want to (or need to) file an operating agreement and get your EIN.

How Much Does a Food Truck LLC Cost?

The cost of setting up a limited liability company will vary depending on the state or jurisdiction.

The administrative cost of setting up your LLC will often be determined by your state’s secretary of state’s office.

For example, it costs about $200 to start an LLC and $60 to renew your LLC annually in Washington State. In California, currently, they waive the first year, but an $800 “tax” is required to renew your LLC before you can operate.

Your initial fees to set up and your annual costs will vary depending on where you operate.

How Should I Prepare to Setup My Food Truck LLC?

Understand privacy issues
Name your food truck
Select an address
Have a registered agent
File your articles of organization
Sign an operating agreement
Obtain your EIN
File reports regularly

Understand Privacy Issues

Everything you submit to the government regarding your business is public record. Your name, phone number, address, or other pertinent information is accessible to the public.

Have Your Food Truck Name Ready

Before you file your Food Truck LLC, you will want to have chosen a name before you finalize your name, research to ensure that the name you wish to doesn’t violate anyone’s copyright. For example, selecting the name “Starbucks mobile coffee” or “In and Out Burgers and Dogs” will probably not be a good idea.

Have an address

You may choose to use your own home address or a business address. Either way, you must provide a business address to register your company.

Determine a registered agent

Every LLC that is established will need to have a registered agent. A registered agent is a person that is responsible for the correspondence and maintenance of the LLC with the state’s secretary of state’s office. Some businesses choose to elect or pay someone to be the registered agent. In addition, many business owners establish themselves as registered agent on file.

File the Articles of Organization

The organization article for your food truck is a document that establishes your business in your state. The document is to operate your food truck legally. Commonly, the state will provide you with the form to fill in or download from their website. It will include the name of your business, the list of members, the address of the registered member, and the management arrangement (whether the members or a hired manager will manage it).

Prepare an operating agreement

And operating agreement Some states require an operating agreement to be signed as you apply for your LLC. An operating agreement is an agreement between partners on how your business will be operated. For example, the operation may include the division of labor, responsibilities, and which members have decision-making power.

You Have Your Food Truck LLC; what Comes Next?

During the process of obtaining your LLC, you should also obtain your Employer Identification Number.

Often, you can apply for your Employer Identification Number (EIN) when you register as an LLC. However, if this isn’t possible, you can easily apply for your EIN through the IRS website.

File Your Report Annually

Your LLC must be renewed annually. This can be done online or through the mail. If you fail to renew your LLC, your LLC will be dissolved. However, at a later date, you may re-establish your business at the initial cost.

Conclusion

In the end, establishing an LLC allows you to get down to business. An LLC opens the doors you need for you to do your job – selling great-tasting food and beverages.

Getting your Food Truck LLC is a relatively easy and painless process. In most states, the fees are reasonable.

This is an exciting step to starting your food truck. Once you do that, you can take your food truck business in any direction.

From here, you might want to work on your: