It’s such an exciting time when you’re planning to start your own business. You’re working to make your dreams a reality. However, all the legal details and paperwork can quickly become overwhelming and take some of the joy out of the experience.
At ZenBusiness, we make it easier for you to start, run, and grow your Minnesota limited liability company (LLC). We’ve compiled all the information you need so that you can easily see what you need to do to start an LLC in Minnesota. Take a look at our guide below and let us know how we can be a part of your plan today.
The 5 steps to form an LLC in Minnesota:
To start an LLC in Minnesota, you’ll need to file your Articles of Organization with the Secretary of State. It sounds easy enough, but there are many details to work out before and after doing so. Check out our simple step-by-step guide to help you better understand the LLC process so that you can get your business on the path to success as soon as possible.
Step 1: Name Your Minnesota LLC
Choosing a name for your business is the first step to forming an LLC in Minnesota. It’s a chance to be creative and really pin down what you and your business have to offer. When thinking about how to name your LLC, keep in mind that the company name should be unique and descriptive. The best name for your Minnesota LLC should:
- Set your business apart from the competition
- Allow consumers to identify your LLC’s purpose quickly
- Transfer easily to usage on the internet
Minnesota state law governs how LLCs are named. There are five guidelines to follow:
- The name must be in English or any other language expressed in English letters or characters.
- The name must end with “LLC” or “Limited Liability Company.”
- The name must be different from the name of each domestic LLC, limited liability partnership, corporation, and limited partnership, and each foreign limited liability company, limited liability partnership, corporation, and limited partnership on file, authorized or registered to do business in Minnesota.
- The name can’t contain the words “corporation,” “incorporated,” or any abbreviations related to those words.
- The name can’t contain a phrase or a word that implies the business is organized for something other than its allowed purpose.
You’ll need to conduct an online search to see if the name you want to reserve or register is in use. Checking name availability is done online through the Secretary of State’s office. You’ll need to create an online account and sign in to the website to search. Any name conflicts will be listed after you submit the search form.
According to Minnesota law, there are several ways to make one name differ from another that’s already on file. For example, you could alter a name by using:
- An abbreviation
- A contraction
- A plural word
- A Roman numeral
- A numeral instead of a word
- A word instead of a numeral
If you’ve chosen the perfect name but aren’t ready to register your LLC, it’s good to reserve the name. This way, no one else can use it while you’re busy figuring out the rest of your business plan.
You’ll need to reserve your business name with the Minnesota Secretary of State’s office. The name reservation is valid for 12 months after the filing date. When the reservation expires, you can renew it for up to another 12 months.
The filing fee for name reservation by mail is $35. For expedited service in-person and online filings, the cost is $55. Reserving a name does not count as registering the business; it reserves your right to register an LLC in that name at a later date.
If you’ve already registered your LLC under one name but want to do business under another, you’ll need to file an assumed name/DBA form. The fee for filing a Certificate of Assumed Name is $50 for expedited service in-person and online filings and $30 by mail.
Your assumed name certificate needs to be renewed every year. It’s free to do so if the assumed name is active and in good standing. However, if the certificate has expired, then you’ll need to pay to reinstate it. It costs $45 for in-person and online filing or $25 for filing by mail. Amendments and cancellations are available, too.
Minnesota law requires that you publish your original Certificate of Assumed Name and any following amendments in a qualified legal newspaper for two consecutive issues. This information must be published in the county that the principal place of business is located. The newspaper will send you an affidavit, or proof of publication, afterward. Be sure to hold onto it so that you can prove you followed the law.
One last thing to consider is your LLC’s trademark or service marks. It can be the name of your LLC or a logo, such as a visual symbol of your business. You can register your trademark with the state so that it’s officially recognized as yours within Minnesota. It’ll cost you $70 if you register in-person at the Secretary of State’s office and $50 if done through the mail.
To register at the federal level, you’ll need to check with the United States Patent and Trademark Office to see if your LLC name or logo is already trademarked.
Step 2: Appoint a Registered Agent in Minnesota
A registered agent is an individual or business that handles all legal correspondence on behalf of your LLC. You aren’t required to appoint a registered agent in Minnesota, but there are many benefits to doing so. You may find it difficult to manage every important filing, legal notice, and government deadline without one.
In Minnesota, your registered agent must be one of the following:
- A person residing in Minnesota
- A Minnesota entity
- A foreign entity authorized to do business in Minnesota
The agent must have a physical registered office address in Minnesota. A P.O. box isn’t acceptable. You can be your own Minnesota registered agent, but you may not want to be. Taking care of all the legal paperwork can cut into the time you need to run and grow your LLC successfully.
That’s where we come in to help ease the burden. A registered agent service like ZenBusiness offers many benefits, including:
- Ensures legal compliance, adds protection, and keeps you organized
- Offers privacy, security, and prompt service
- Always available during business hours to handle things when you otherwise may not be.
To appoint a registered agent in Minnesota, you must include it when you fill out the Articles of Organization form and file it with the Secretary of State.
Step 3: File Minnesota Articles of Organization
The Articles of Organization officially registers an LLC with the government. To start your LLC in Minnesota, you must file the Articles of Organization form with the Secretary of State. You can file as an individual or with a business partner or partners. You’ll need the following information to fill the form:
- The name of LLC
- The registered office address
- The registered agent name
- The organizer’s name, address, and signature
- An email address for official notices
- A contact name and daytime phone number
The fee for filing your Minnesota Articles of Organization is $155 for online filings and expedited services in person. The cost is $135 to file by mail.
If you choose to mail your Articles of Organization, send it to:
Minnesota Secretary of State – Business Services
Retirement Systems of Minnesota Building
60 Empire Drive, Suite 100
St Paul, MN 55103
In addition, all Minnesota LLCs must be renewed every year by the end of December to avoid being shut down by the state. Most states have an “Annual Report” that must be filed every year along with a fee, but instead, Minnesota has this Annual Renewal form. Fortunately, there is no charge for the Annual Renewal. If you need to change the company’s name, registered agent, or office address, you must submit an amendment form and LLC renewal form. The amendment filing will cost $35 by mail and $55 for in-person or online filing.
Step 4: Create an Operating Agreement
An Operating Agreement sets forth the rules for how your LLC and its members are going to work. According to state law, your LLC Operating Agreement governs:
- Relations among the LLC members
- Relations between the members and the LLC
- Rights and duties of the managers
- Company activities and conduct
- Conditions for amending the agreement
It’s not required to file your Operating Agreement with the state, but it’s highly recommended to create and adopt an agreement. Otherwise, under Minnesota law, your LLC will be subject to default provisions that were created to apply to all LLCs without an Operating Agreement.
An Operating Agreement helps prevent conflict and safeguards your business whether or not you file it with your Articles of Organization.
Step 5: Apply for an EIN
An Employer Identification Number (EIN) is a unique number given to your LLC by the federal government. The IRS uses this number to identify your company for tax purposes. Having an EIN helps keep your personal and business finances separate. It also helps protect you from identity theft.
You can apply for an EIN online or let ZenBusiness secure an EIN for you. You’ll also need to apply for a tax ID number from the Minnesota Department of Revenue. To do so online, you’ll need:
- Your federal EIN
- Your legal name and business address
- Your business name (DBA), if applicable
- Your NAICS code
- The names and Social Security numbers of proprietor, officers, and/or partners
- The name and email address of a contact person
After you apply, you’ll receive a seven-digit number to use when it’s time to report and pay state business taxes. Your EIN will be used when filing federal taxes and can also help you open things like a business bank account.
How much does it cost to start an LLC in Minnesota?
The cost to start an LLC in Minnesota varies based on several factors. The original cost is $155 for an expedited in-person or online filing of the Articles of Organization form or $135 for a non-expedited filing by mail. The annual renewal is free; however, any amendments are $35 by mail or $55 in-person or online.
Various state filing fees also exist for LLCs:
- Resignations of agents
- Statements of authority
Note that the above doesn’t consider ongoing costs like renewing licenses and permits.
What are the benefits of an LLC in Minnesota?
The benefits of forming a Minnesota LLC include:
- Protection of personal assets
- Exemption from double taxation
- Flexible management structures
- Fewer requirements and formalities
How is an LLC taxed in Minnesota?
How a Minnesota LLC is taxed depends on how it chooses to be treated for tax purposes. You can elect to be taxed as a sole proprietorship, partnership, or corporation. If your LLC has more than one member, it can be taxed as a partnership or corporation. If there is only one member, then it can be taxed as a sole proprietorship or corporation.
There is a wide variety of business taxes that your Minnesota LLC will need to pay. These include state and federal taxes and income tax. It’s always wise to consult a qualified accountant for help.
Minnesota LLC FAQs
- What is the processing time to form my Minnesota LLC?
Expedited online processing is immediate. Expedited in-person filing is done while you wait in the office. Processing time by mail varies, as it is done on a non-expedited, first-in-first-out basis. Your Articles of Organization, for instance, if filed by mail, can take four to seven business days for approval.
- Do I need to file my Operating Agreement with the state of Minnesota?
No, you don’t need to file your Operating Agreement in Minnesota. However, the state recommends that you form an Operating Agreement before registering your LLC with the Secretary of State’s office.
- What tax structure should I choose for my Minnesota LLC?
Most LLC owners pay state and federal taxes on income earned from their business as part of their individual taxes. Sometimes, larger LLCs choose to file taxes as a corporation.rnrnThe tax structure you choose for your Minnesota LLC depends on different factors. It’s best to consult with a specialist to be sure that you’re following all applicable tax laws and doing what’s best for your LLC.
- Does Minnesota allow a Series LLC?
No, Minnesota doesn’t allow a Series LLC.
- Which licenses and insurance are required for an LLC in Michigan?
Although Michigan doesn’t require a general business license to operate, certain industries require specific licenses and permits. To find out if you’re required to apply for a business license and how to apply, visit Michigan’s State License and Permit Search.
Your LLC might be required to obtain an insurance policy, depending on the type of business and whether you have employees. The types of insurance range from professional liability insurance to unemployment and workers’ compensation insurance. You can find a complete list and industry requirements on the Michigan Department of Insurance and Financial Services website.
In both instances, we recommend hiring a professional service like ZenBusiness who will provide you with a comprehensive package of all the licenses and insurance required for your Michigan LLC.
- Which licenses and insurance are required for an LLC in Minnesota?
Depending on the type of business you conduct, you may need to acquire local, state, and/or federal licenses to legally do business. To see if you need any state-required business licenses, search the state’s licensing web portal, Minnesota ELicensing. This is where you can browse for licenses by topic or agency.rnrnAs for insurance, Minnesota requires an LLC to carry workers’ compensation insurance if they employ one or more persons. Further coverage, such as liability insurance, might be beneficial for your LLC. It’s best to check with insurance professionals to learn all your options.
- How do I renew my LLC in Minnesota?
You must renew your LLC in Minnesota every year by filling out the appropriate online renewal form. There is no charge for renewals as long as the company is in good standing with the state.
- How do I dissolve my LLC in Minnesota?
To dissolve your LLC in Minnesota, you’ll need to file dissolution paperwork with the state. The first is a Statement of Termination form, and the second is a Statement of Dissolution form.