How to Create an LLC in Minnesota

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How to Form an LLC in Minnesota:
5 Simple Steps to Get Started
According to the IRS, each state may use different regulations around forming an LLC, and you should check with your state if you’re interested in starting a Limited Liability Company. To simplify the process of forming an LLC in the state of Minnesota, we’ve put together a step-by-step guide to detail each step of the process and answer any questions you may have.

Step 1
Name Your Minnesota LLC

Your first consideration when choosing a name for your LLC is that it be unique from any other business in the state of Minnesota. You can quickly and easily check your company’s potential name options at the Minnesota Secretary of State business name database. For a $35 fee by mail or $55 online, you can also reserve a company name for 12 months. To do so, you’ll need to submit the Name Reservation form with the Minnesota Secretary of State Business and Lien system.

In order to comply with Minnesota state law, your company’s name must contain the term “Limited Liability Company.” This can appear abbreviated as “LLC” or “L.L.C.” You may not use “Corporation,” “Incorporated” or abbreviations thereof in your LLC’s name. The words “bank,” “trust,” “trustee,” “incorporated,” “inc.,” “corporation,” “corp.,” “insurer,” “insurance company,” or any wording that suggests the company is an insurance business are not allowed in Minnesota without providing a lengthy list of supporting documents.

Additionally, your name cannot include words that could confuse your LLC with a government agency (Treasury, State Department, etc.), and some restricted words (e.g., university, attorney, etc.) may require additional paperwork and a licensed individual, such as a doctor or lawyer, to be part of your business.

Step 2
Appoint a Registered Agent in Minnesota

The state of Minnesota requires that any LLC have a registered agent for service of process. This means your LLC must have an entity that agrees to physically accept any legal papers on the company’s behalf should it be sued.

The registered agent does not have to be an individual person and can be any resident of the state of Minnesota or a business entity authorized to do business in Minnesota so long as the agent has a physical street address within the state.

Step 3
File Minnesota Articles of Organization
To officially create your LLC in the state of Minnesota, you’ll need to file Articles of Organization with the office of the Secretary of State. This can be done online at the Minnesota Secretary of State webpage with a $135 fee and by either mail or in person with a $155 fee. To complete this form you will need to know the following:
  1. The final name and address of your LLC
  2. The name and address associated with the company’s registered agent
  3. The name and address of at least one organizer

Step 4
Create an Operating Agreement

You may want to consider preparing an operating agreement to outline the ownership and operating procedures for your LLC. Though not required by the state, an operating agreement will set the guidelines for running your company. This does not need to be filed with the state, but it can go a long way to ensuring your company’s success.

Step 5
Apply for an EIN and Review Tax Requirements

An IRS Employer Identification Number (EIN) is required for your LLC unless it is a single-member LLC with no employees. Obtaining an EIN is as easy as completing the application on the IRS website.

It’s possible your company will need to register with the Minnesota Department of Revenue. Whether or not your company needs to follow this step will depend on the exact types of taxes it will be collecting and/or has been collecting from the state and if you have employees. If necessary, you can register online through the Minnesota DOR’s e-Services site.

If your LLC will be selling a physical product, you’ll need to register for a sellers permit through the Minnesota Department of Revenue website. This will allow you to collect sales tax on taxable sales. Additionally, if you have employees, you’ll need to register for Unemployment Insurance Tax through the Minnesota Department of Employment and Economic Development website and also register for Employee Withholding Tax through the Minnesota Department of Revenue website.

Other Considerations
Foreign LLCs and Business Licenses
Foreign LLCs

If your company is a foreign LLC wanting to do business in Minnesota, you will still need to follow all the steps outlined above.

The main difference is that the form required to make your LLC legal to operate is referred to as a Certificate of Authority to Transact Business in MN (LLC).

You can file the form on the Minnesota Secretary of State website for $205 or by postal mail for $185. Once all the other requirements are met, your foreign LLC will be fully operational.

Business Licenses

Some industries will require you to secure state and local licenses to legally operate in the state of Minnesota.

You can get federal licenses and perform a Minnesota license and permit search on the appropriate licensing for your business.

Since business licenses and permits are issued at all levels of government—federal, state, and local—and for such a multitude of reasons (e.g., health, building, signage, etc.), you should still do careful research to find out what licenses and permits you need. You can also hire or use a professional service to do it for you.

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