Opening a new business can be exhilarating and overwhelming. Getting your company formed and running can be a fulfilling endeavor, but figuring out all the steps you need to complete to stay compliant with state laws in North Dakota can feel daunting.
The good news is that while the paperwork can seem exhaustive, the steps to forming an LLC in North Dakota are very straightforward and simple. Most (if not all) of the process can be completed online, saving you time and energy. Best of all, if you need help navigating the process, there are trustworthy professional business partners you can team up with to help guide you through each step.
In this LLC guide, we’ll take you through every step of the LLC formation process in North Dakota, so you can get your business up and running with confidence. We’ll offer a quick overview of the process, take a deeper dive into the individual steps, connect you with the links and forms you’ll need to file, and offer insights and ways to seek help if you need additional assistance.
We know how important it is to get your North Dakota business running as quickly as possible — allow this guide to help steer you in the right direction.
The 5 steps to form an LLC in North Dakota:
To officially launch your new company, you’ll need to register your LLC with the North Dakota state government. This is an important step — the government must officially recognize your LLC as legitimate for your company to begin operating. This also helps the state of North Dakota keep you informed about changes to important business laws and procedures.
Before you can have your LLC registered, you’ll have some preparation to complete. This initial work includes choosing an official name for your LLC, selecting your company’s registered agent, creating an Operating Agreement to mandate how your LLC will operate, and setting your LLC up to pay taxes.
We understand that these steps can feel complicated, so we’ll take a close look at each one to help you make better decisions while forming your North Dakota LLC.
Step 1: Name Your North Dakota LLC
The first thing you’ll need to do when setting up your LLC is deciding on your company’s name. Since your name will likely be the first thing prospective clients see or hear about your LLC, it’s important to choose a name that fits your brand, message, or service. You also want to make sure your LLC name follows all North Dakota state regulations.
We recommend making a shortlist of three to five names that all LLC members can agree on. Once you have your list, you’ll want to use the North Dakota Business Search portal to ensure no other company is already registered with that name. North Dakota requires all companies to have unique names, so if one of your options is already taken, move on to the next.
Once you’ve chosen a name that’s available, you’ll need to add an LLC designator to its end. This designator is essentially a suffix indicating that your company is an LLC. In North Dakota, you can choose from “Limited Liability Company,” “LLC,” or “L.L.C.” For a full list of naming requirements, see Section 10-32.1-11 of the North Dakota Uniform Limited Liability Company Act.
Once you’ve selected a designator, you can reserve your company’s name to ensure it’s available when you register. You can reserve your company name online via the FirstStop North Dakota Secretary of State online filing system. There’s a $10 filing fee you’ll need to pay to complete the process.
If you think you’ll want to open a company website, you should look into registering a domain. To do this, you’ll first want to look for available domain names (ideally, your domain will contain your LLC name) by running a domain search.
You may also want to think about registering any trademarks related to your business, as well as checking to make sure your desired business name isn’t already trademarked by someone else. You can do this on the state and federal levels. Federally registered trademarks have broader protections, which can be valuable if you plan to do business outside of North Dakota. You can trademark your LLC name in North Dakota by filing the North Dakota Trademark/Service Mark Registration form online. For federal registration, visit the United States Patent and Trademark Office website.
Lastly, if you decide to market your company with any name other than your official LLC name, you’ll need to secure a DBA (“Doing Business As”). A DBA is called a trading name in North Dakota. You can file a trading name online via the FirstStop government portal. The fee for filing is $25.
Step 2: Appoint a Registered Agent in North Dakota
In North Dakota, you must assign a registered agent to your LLC. A registered agent is a party that acts on your behalf and receives official documentation from the North Dakota Secretary of State’s office.
When selecting a registered agent in North Dakota, the agent must have an office address in the state (P.O. boxes are not permitted) and operate under normal business hours (9 a.m. to 5 p.m. local time, Monday through Friday).
You can choose to serve as your own registered agent, but there are a few downfalls to this. First of all, you run the risk of being served embarrassing paperwork (like a service of process) in front of clients. Secondly, this would require some of your private information to become public.
For this reason, many business owners in North Dakota decide to work with an outside business entity like a registered agent service that can handle this paperwork and pass it along at a convenient time for both parties.
You can also view a full list of commercial North Dakota registered agents on the Secretary of State’s website.
Partnering with a professional service like ZenBusiness is also affordable and can save you time and energy.
Step 3: File North Dakota Articles of Organization
Now you’re ready to file your North Dakota LLC with the state. To file the Articles of Organization online, log in via FirstStop. The filing fee is $135. You can access this form via your FirstStop portal and submit it online or print it and mail it to the state office. When completing this form, you’ll need to provide:
- Your LLC’s official name
- Your LLC’s principal office address
- Your registered agent’s name and physical address. Also include the mailing address if different from the physical address.
- All names of the company’s organizers
- Your LLC effective date
- Signature of at least one organizer
The form only takes a few minutes to complete.
Step 4: Create an Operating Agreement
Another step you’ll want to consider is creating an LLC Operating Agreement. Although Operating Agreements are not required by North Dakota law, they offer your company pretty powerful protections. Your Operating Agreement outlines your business structure and how your company will be run and/or managed. It can also dictate voting structures and specify how to handle disputes. Even if you’re a sole-member LLC, your Operating Agreement will help the government understand how your company should be run if you’re incapacitated or unable to manage your company. A few other reasons why you may want to draft an Operating Agreement include:
- It creates a better separation between your personal and company finances, offering you and your fellow LLC members more protection from legal liability.
- It helps new investors or partners understand how your company is managed before they decide to join.
- It allows you to better resolve and prevent conflicts between partners or managers by detailing how voting structures and resolutions will be handled.
You don’t have to file your Operating Agreement with the state, but you want to make sure it covers all of the most important aspects of your company’s operations.
Step 5: Apply for an EIN
The next and final step you’ll want to take is setting your business up to pay business taxes and ensuring you apply for any special permits or licenses you need to operate.
You’ll get your tax paperwork set up by requesting an Employer Identification Number (EIN) through the Internal Revenue Service (IRS). You can apply for an EIN online and receive your number right after your application is submitted, free of charge.
Your EIN is similar to an individual’s Social Security number, except this number is for tax purposes. It lets you pay and file taxes, hire and pay employees, open business bank accounts, and much more. Even if you’re the only member of your LLC, you might want to secure an EIN to separate your personal finances from your business finances.
Once you have your EIN, the process is almost complete! The last step is to check to see if you’re required to obtain any licenses or permits to operate in North Dakota. Regulations vary depending on the industry of your LLC, so be sure to review the state’s guidelines here. There are also licenses that are needed at the federal and local levels, so you’ll need to do some research.
How much does it cost to start an LLC in North Dakota?
The costs of opening an LLC in North Dakota can vary dramatically depending on how large your company is and whether you’re securing an office, hiring employees, and/or paying consulting fees to experts like accountants and business specialists during the setup process. To help you better estimate your upfront costs for forming an LLC, let’s look at your basic formation expenses:
- Reserving your business name: $10
- Filing your Articles of Organization: $135
- Applying for an EIN: $0
This means your total base formation cost will be $145 in North Dakota. Remember that you’ll also need to file an annual report each year, which will cost an additional $50.
What are the benefits of an LLC in North Dakota?
Many companies opt to form an LLC for a good reason. That’s because an LLC structure offers more flexibility in management style, requires fewer reporting requirements, and offers financial and legal protections. They’re also relatively easy to set up. Here are a few other reasons why you might want to form an LLC in North Dakota:
- There’s a better delineation between your personal finances, assets, and debts and your business’s.
- LLCs are exempt from double taxation, which means you’ll only pay taxes on your LLC profits once on your personal taxes.
How is a North Dakota LLC taxed?
In addition to double taxation exemptions, there are some tax requirements you should be aware of when forming an LLC. Here’s what you need to know:
- You’ll have to pay self-employment taxes: You’ll be considered a self-employed individual. You’ll file your personal taxes detailing your business income, losses, and expenses every year.
- You can choose to be taxed as a corporation: If you want to be taxed as a corporation, you’ll file separate taxes, one for your company and one for your personal taxes. Your company taxes will detail your business income, losses, employee expenses, and general expenses every year. You’ll also need to fill out an 8832 tax form online via the IRS if you file as a C corporation and Form 2553 for an S corporation.
- To avoid tax penalties at the end of the year: You’re required to pay estimated quarterly taxes on behalf of your LLC. Paying them throughout the year will save you from owing more at the end of the year. You’ll need to make both state and federal payments online to avoid these penalties. You’ll also need to set up tax withholding accounts if you have employees to withhold tax from your employees’ paychecks.
- If you collect sales tax: If your LLC is collecting sales tax, you’ll have to set up a sales tax account with North Dakota’s Office of State Tax Commissioner.
North Dakota LLC FAQs
- What is the processing time to form my North Dakota LLC?
When you file and submit your Articles of Organization online for your North Dakota LLC, your filing is typically processed and active within 24 hours. Online filing is strongly encouraged, but if you file via mail, expect the process to take several business days.
- Do I need to file my Operating Agreement with the state of North Dakota?
No, North Dakota does not require LLCs to file an Operating Agreement to operate, but it strongly recommends all companies create one for their protection.
- What tax structure should I choose for my North Dakota LLC?
Most LLC owners elect to have their business taxed the default way, which is as a sole proprietorship (for single-member LLCs) or a partnership (for multi-member LLCs). This method only requires partners to pay taxes on their percentage of the profits on their personal tax returns. The LLC itself is not taxed. This avoids the “double taxation” that corporate shareholders pay, in which profits are taxed both at the business level and the personal level.rnrnIf you have a large LLC or one that yields high earnings, it could make sense to be taxed as a corporation. You’ll want to read our guide on corporation taxes before making this decision since the distinctions are very different from being taxed as a sole proprietorship or partnership.rnrnWe also recommend partnering with a professional accountant or tax specialist if you need further guidance.
- Does North Dakota allow a Series LLC?
A Series LLC is a group of LLCs that operate under one parent LLC. While many states in the U.S. do not allow Series LLCs, North Dakota is one of the few that do.rnrnIf you’re interested in creating a Series LLC, you can reach out to ZenBusiness for help. To register new LLCs as a series, you’ll go through the same registration process detailed above, indicating if your LLC is a series when filling out your Articles of Organization.
- Which licenses and insurance are required for an LLC in North Dakota?
You’re not required to obtain a general business license to operate an LLC in North Dakota. However, some counties and industries have specific requirements. You can learn more about these requirements on the North Dakota New Business Registration website.rnrnZenBusiness can also walk you through any special permits or licenses that your LLC will need. Save yourself the time and effort by teaming up with professionals who can quickly match you with your license and insurance requirements.
- How do you dissolve an LLC in North Dakota?
To dissolve your North Dakota LLC, you will need to file the Articles of Dissolution and Termination form via the FirstStop portal. You’ll need to pay a $20 filing fee.