How to Form an LLC in Minnesota
This guide to starting an LLC in Minnesota provides step-by-step instructions on filing formation documents, obtaining tax IDs, and setting up company records.
Overview
LLCs are the most popular business structure because they are inexpensive to form, provide flexibility to the owners, and are easy to run. Forming your LLC legally establishes your business, limits your personal liability, and gains tax flexibility. The following step-by-step will help you as you undertake this process.
Fast Facts: Your Budget and Timeline
Here is an overview of the total paperwork, cost, and time it takes to form an LLC in Minnesota. Be sure to read the final step in this guide - "Ongoing Filings" - to understand your ongoing costs to maintain a compliant Minnesota LLC.
- Minnesota Limited Liability Company Articles of Organization
- Operating Agreement
- IRS Form SS-4: Obtain an EIN
- Form ABR: Minnesota Revenue Application for Business Registration
- Formation: $135 by mail. $155 online or expedited in-person.
- Formation: ~5-7 business days by mail. ~24hrs online.
Step-by-Step Minnesota LLC Instructions
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Check Name Availability
The legal name of your LLC may not conflict with any other registered name. Check availability of your desired name by conducting a name search.
Name Search: Minnesota Secretary of State
Name searchName Reservation: Optional Suffix: The limited liability company name must: (1) be in the English language or in any other language expressed in English letters or characters; (2) contain the words "limited liability company," or must contain the abbreviation "LLC"
§ 322C.0108 Minnesota Statutes -
Appoint a Registered Agent
Before you officially file to create your Minnesota LLC, you will need to decide who your Minnesota registered agent will be. A registered agent is a business's legal appointee to receive notice of lawsuit and other legal or government notices.
State law requires every LLC to have a registered agent. The registered agent is designated when you file Minnesota articles of organization with the Minnesota Secretary of State.
Our reliable registered agent service fulfills this requirement. You get:
- Same-day documents from our local office in Owatonna
- Immediate online access to state forms with our address and, where required, our signature
- Annual fees from $89 to $99 per state with no additional charges
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File Minnesota Certificate of Formation
File the articles of organization to create your limited liability company.
Agency: Minnesota Secretary of State Form: Filing Method: Mail, in-person, or online
Agency Fee: $135 by mail. $155 online or expedited in-person.
Turnaround: ~5-7 business days by mail. ~24hrs online.
Law: Notes: - Keep the original signed copy in your records. Submit a copy to the state.
- The Minnesota Secretary of State will endorse on the original the word "Filed" and the month, day, year, and time of filing, record the document in the office of the secretary of state, and return the document to the person who delivered it for filing.
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Establish Company Records
Your LLC must keep correct and complete books and records. Your filed articles of organization are the first documents for your LLC’s records. Your LLC will generate many other official records such as:
- Meeting minutes
- Operating agreement
- EIN verification letter
- Amendments and other filings made to the LLC throughout its lifetime
Organizations need a secure, centralized tool for managing and accessing sensitive records. Our Records Manager software offers a simple, efficient way for LLCs to store records, track members and managers, and customize meeting notifications.
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Create the Operating Agreement
Draft an Operating Agreement (potentially using a template) which is the governing document for the LLC. It defines the formalities of how the LLC will run itself such as holding an annual meeting. You will review and adopt the agreement at your organizational meeting.
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Hold the Organizational Meeting
The first meeting of the members of the LLC is the organizational meeting. You will need your filed articles of organization and your operating agreement in order to conduct this meeting. Keep minutes of this meeting and store them in your company record book.
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Get a Federal Employer Identification Number (EIN)
If your LLC has more than one member or will hire employees, it must obtain an EIN. An EIN is also often required to open a bank account.
Agency: Internal Revenue Service (IRS) Form: Filing Method: Mail, phone, fax, or online.
IRS fee: $0
Turnaround: Immediately online or by phone. 4 business days by fax. 4-5 weeks by mail.
Notes: The IRS website is only available during certain hours. Print your EIN before closing your session. For additional guidance, see IRS Pub 1635: Understanding Your EIN.
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Get Minnesota State Tax Identification Numbers/Accounts
Not all LLCs will need to obtain a Minnesota Tax ID and register. Minnesota offers a consolidated state tax registration application.
- Guidance:
- Minnesota Tax ID Requirements
- Submit to:
- Minnesota Department of Revenue
http://www.revenue.state.mn.us/ - Form:
- Form ABR: Minnesota Revenue Application for Business Registration
- Instructions:
- Minnesota Application for Business Registration - Instruction Booklet
- Filing Method:
- Mail, fax, phone, or online
- Fee:
- $0
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Consider Electing S-Corp or C-Corp Taxation
By default, your LLC receives pass-through taxation and the vast majority of LLCs keep this tax classification. Some LLCs benefit from electing S-Corp or C-Corp tax treatment:
- S-Corp treatment can help owner-employees who earn more than ~$75,000 per year save on self-employment taxes. File Form 2553: S-Corp Election.
- C-Corps suffer from double taxation: the corporation pays taxes on profits then members pay taxes on their distributions. If profits exceed $250,000 per owner, you provide employee benefits, or you will re-invest most of your profit in the business, you may benefit from the low tax rates on retained earnings under C-Corp treatment. File Form 8832: C-Corp Election.
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Obtain Business Licenses & Permits
To run your business legally, you must obtain applicable licenses and permits. The easiest way to navigate the wide range of federal, state, and local requirements is to search by your business type and locality using the Small Business Administration Business License & Permit look-up tool.
Minnesota Business License
Not required
General Business License licensure is not required on the State level in Minnesota.
Minnesota does not have a general business license at the state level, but local licenses are often required.
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Ongoing Filings to Maintain Your LLC
You must file federal and state tax returns.
Many states also require business entities to file an annual report to maintain good standing with the secretary of state. If an annual report is required for LLCs formed in Minnesota, view the table below.
Domestic Minnesota Corporation Annual Report Requirements:
Agency: Minnesota Secretary of State Form: Filing Method: Mail or online.
Agency Fee: $0
Due: Annually by December 31.
Law: MN Stat. § 302A.821.
Penalties: Dissolution or revocation on January 1. There is a fee for reinstatement.
Notes: - Anyone with authority may file.
- Original signatures are not required.
- You cannot change your registered agent or principle address on the annual report. You will have to attach an ammendment to your annual report with a $50 fee.
For more details, see our Minnesota annual report information center page.
As your LLC grows, you will need to demonstrate your company’s good standing to banks, customers, and other state agencies. After all the work involved in forming your Minnesota LLC, don’t let a missed annual report filing cause your new business to fall out of compliance.
Tracking and filing annual reports on your own can be time consuming and lead to accidental lapses. Protect your LLC’s good standing with Managed Annual Report Service, which tracks and automatically files reports on time, every time, so you can focus on your business.
Helpful Tools
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Choose which one is right for you.
Limiting Your Liability
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