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.

Step-by-Step Minnesota LLC Instructions

1. 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 search
   Name 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

2. Appoint a Registered Agent

   Identify the LLC’s Minnesota registered agent. This individual or company receives notice of lawsuit and other legal service for the LLC.

3. File Minnesota Certificate of Formation

   File the articles of organization to create your limited liability company.

   Agency:	Minnesota Secretary of State
   Form:	Articles of Organization – Original Filing for 322C
   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:	2012 Minnesota Statutes Chapter 322B
   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.

4. Establish Company Records

   Your filed articles of organization are the first document for your limited liability company records. Your LLC will generate many other official records such as your operating agreement, meeting minutes, and your EIN.

   Office supplies intended for an LLC will help you stay organized and save time. Membership certificate templates should come with your company record book. Each owner receives a membership certificate as evidence of his or her ownership in the LLC.

5. 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.

6. 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.

7. 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:	IRS Form SS-4
   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.

8. 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

9. 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.

10. 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.

* Ongoing Filings to Maintain Your LLC
You must file federal and state tax returns. You must also file:
• Minnesota LLCs are required to file a Minnesota Annual Report.