Minnesota LLC – How to Form an LLC In Minnesota? (7 Step Guide)

Form Your LLC in MN Hassle-free

Minnesota-LLC

Starting a new business can be a very exciting time, but there are some processes you need to put in place before getting started. One of the most important decisions is which business structure you are going to use. One of the most popular is an LLC. An LLC stands for Limited Liability company, and essentially combines the limited liability of a corporation with the lack of formality and the flexibility of a sole proprietorship or partnership. When you look at it this way, you can see why it is so popular, as you are getting the best of both worlds. It is also relatively easy and inexpensive to set up, which helps to add to its appeal.

Before you start running your LLC, you will have to file it within the state that you are conducting business. Each state comes with its own fees, rules and requirements when it comes to filing an LLC. Today we are going to take a look at the 7 steps you are going to need to take if you are planning on setting up an LLC in the state of Minnesota.

Step 1: Choose a Name for Your Minnesota LLC

Choose-Your-Business-Name

Before you do anything, you’ll need to decide on a name for your LLC, however, that may not be as easy as it sounds. To start with, under the law of the state, an LLC name in Minnesota must contain the words ‘Limited Liability Company’, or the abbreviation of this.

It must also be distinguishable from all of the other business entities in the state that have filed with the Minnesota Secretary of State. Once you have come up with a name that you like, and ensuring it contains the term ‘Limited Liability Company’, you can check that the name, or a similar sounding name, is not already in use by searching the Minnesota business name database. If your name is available but you are not quite ready to file it yet, you can reserve the name for up to 12 months. This can be achieved by filing a name registration with the Office of the Minnesota Secretary of State Business and Lien System. You can either chose to do this online, which comes with a $55 filing fee, in person, which also has a $55 filing fee, or by mail, which costs $50.

There are a few other guidelines you should be aware of, such as your name cannot include any words that would confuse your name with a government agency. These could include words such as Treasury, State, Departments and FBI to name a few. Some restricted words like Bank, Attorney and University may mean that you have to do some additional paperwork, plus a licensed individual needs to be a part of your LLC.

Remember, although you are coming up with the official name for the business, you are also able to register assumed or fictitious business names, which are known as a DBA name (doing business as). This can be very helpful if you want to start up another branch of the business or make your name more memorable. I encourage you to also read on how to file for DBA here. You will still need to register this name with the Minnesota Secretary of State, but it gives you another option in the future to use a different name to the one on your Articles of Organization. You can register for this name both online, which costs an additional $50, or $30 if you wish to go through the filing process online. You must then publish this name for two consecutive issues in a legal newspaper in the county where the principal place of business is.

While you are going through the naming process, it is also advisable that you check online to see if your proposed business name is available as a web domain. If the domain is available, it is advisable that you buy the domain when you register your business name so that someone else doesn’t purchase it, even if you don’t plan on making a business website right away.


Step 2: Get a Registered Agent in Minnesota

Registered-Agent-Service

The next vital step is to appoint yourself with a registered agent. A registered agent is an individual, or business entity, who will accept all legal papers on behalf of the LLC. These legal papers could include important tax forms, legal documents, official government correspondence and notice of lawsuits. Basically, they are your point of contact with the state. Who can be the registered agent of the company is quite flexible, but it must be a resident of Minnesota, a Minnesota business entity or alternatively, it can be a foreign business entity that is authorized to do business in Minnesota. They must also have a physical street address in the state. You could even be your own registered agent, or you could choose to elect someone else who is in your company.


Step 3: Filing the Articles of Organization for Your Minnesota LLC

Articles-of-Organization

This is arguably the most important step when it comes to filing an LLC. You must file your Articles of Organization with the Minnesota Secretary of State. What is on your Articles of Organization depends on your business, but contains all the vital information about your business and registered agent.

You can either file your Articles of Organization by mail or you can file it online. Filing by mail costs a little bit less at $135 and online and in person filings are charged at $155.


Step 4: Create Your Minnesota’s LLC Operating Agreement

Operating-Agreement

Not all states require you to have an operating agreement in order to successfully file an LLC, and Minnesota is one of these. Despite the fact that is it not completely necessary, it is good practice to have one, and is very much advised. The operating agreement is the legal document that outlines the operating procedures and the ownership of the LLC.

It can be a very helpful document, especially in the long run, as it ensures that all owners of the business are completely on the same page about how the business is run. This will reduce the risk of future complications as if there is a disagreement in the future, then the members are able to just look back at the operating agreement which was agreed together.


Step 5: Get an EIN for Your Business in MN

Employer Identification Number

An EIN stands for Employer Identification Number, although it is also sometimes referred to as a Federal Employer Identification Number or a Federal Tax Identification Number. The EINs are made up of nine digits and are assigned by the Internal Revenue Service.

Your EIN will be used to help identify businesses for tax purposes, much like how a Social Security Number works. An EIN is very important for an LLC as you’ll have to use it to open a business bank account, to hire any employees, and to file and manage Federal and State Taxes, so you should get it as soon as possible to make things easier for yourself in the future.

The EIN is free to get from the IRS, and the whole process can be done quickly and easily either online or by mail.


Step 6: Comply with Minnesota TAX and Regulatory Requirements

Depending on where your business is located and the type of business it is, there may be some other business requirements that you’ll have to consider. For example, the LLC may need to obtain local and state business licenses. To check if you need a business license, you can check with the clerk for city where the company’s primary place of business is. If you want to find more about state licenses, the place to look is the State of Minnesota Elicensing portal, as this will tell you all you need to know about business licenses in the state.

Again, depending on the type of business that you have, you may need to register with the Minnesota Department of Revenue. This may be if you have employees or will be selling goods or collecting sales tax.


Step 7: File Your LLC Annual Renewals

Once your business is all set up and running, the hard work is far from done. You will have to remember to meet the annual requirements that come with running a business in Minnesota. An annual renewal must be filed once every calendar year with the Secretary of State, as long as it is before December 31.

It is your choice if you want to file your renewal online or by mail. The cheapest option is by mail at $25, although this might take a little longer. Online or in-person filings are charged at $45.


Use Professional Service to Form Your Minnesota LLC

You don’t have to go through the process of forming your LLC yourself, there is always the good option of getting a knowledgeable third party to do all the hard work for you, usually for a small fee. They will handle the whole process for you, from start to finish, leaving you time to do more important things, such as actually running your business. Although there are many different options available for LLC formation services, two of the best are Zenbusiness and IncAuthority.

#1: Start an LLC in MN With ZenBusiness

Zenbusiness is a strong running in the LLC formation service game. Since its beginnings in 2015, it has formed literally thousands of businesses across the states, and has racked up an impressive number of positive reviews. LLC formation is just one of the many services that the company offers. They are one of the most affordable LLC services available, with their most basic package starting at just $39, and still comes with everything you’ll need to form a business successfully. The entire process is smooth and simple, and although there are add ons and up-sells available, they are not pushy, and only offer these additional services in a tasteful way.

$49

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Form an LLC today with ZenBusiness for only $49. They Have 98% customer satisfaction rating and over 4000+ verified reviews.


#2: Start an LLC in MN With IncAuthority

IncAuthority is another popular LLC formation service, likely for one main reason. The company offers their LLC formation service for free, meaning you’ll just have to pay the state filing fee. Not only that, but it also has some very positive reviews online, which shows it does a great job, as well as offering a great price. This free service even comes with a registered agent service for free for a whole year. If you want other services, there are a number of paid packages you could choose from which include services such as tax consultation, a company seal, complete operating agreement, ownership certificates and more.

$0+State Fees

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Rating: 4.8/5
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Form an LLC today with IncAuthority starting at $0+state fees. They’re one of best-known services with lots of great customer experience.


FAQs About Minnesota LLCs

How much will it cost to form my LLC in Minnesota?

There are several costing factors to take into consideration when forming an LLC in Minnesota. To start with, filing your Articles of Organization is likely to be the biggest expense, which is charged between $135 and $155. If you want to reserve your business name, then this is an extra $50-55 depending if you reserve the name by mail, online or in person. Every year you will also have to file an annual renewal, which is either $25 if you file it by mail, and $45 if filled out online or in person.

These are the costs for the initial set up, but then you will have to consider the cost of hiring a registered agent every year, and hiring a third party to form your LLC for you if this is the route you are going down. Hiring a lawyer will be the most expensive option, as this could cost you hundreds, if not thousands of dollars.

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About the Author
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Founder & author

Ian Broderick is an avid author and owner of LLCGuys.com. He's been involved with the LLC formation field for over 4 years. On top of that, he has worked in several well-known LLC formation service providers. Now he decided to share his knowledge and advice with everybody. Since there are a lot of questions and concerns surrounding this field - his aim is to make LLCGuys a top-notch information provider in regards to LLC creation, service reviews and etc..

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