How to Start an LLC in Minnesota: If you’re looking to start a Minnesota LLC, you’ve come to the right page. Setting up an LLC is easy and cost-effective. To form an LLC, you must follow a few steps that include naming your LLC, hiring a registered agent, filing your formation documents, doing the operating agreement, and finally obtaining the EIN. You can easily set up your LLC at a very low cost in Minnesota. Though, you must pay the mandatory state filing fee. These fees and charges can be tax deductible, making the LLC formation cost almost negligible.
On this page, You’ll find all the steps that must be taken to ensure that your Minnesota LLC has been correctly formed. We recommend you read the whole article very carefully, word by word, don’t miss anything 🙂
On this page, you’ll learn about the following:
- How to Start an LLC in Minnesota
- After Starting Your Minnesota LLC
- Minnesota Foreign LLC
- Minnesota LLC Formation Review
How to Start an LLC in Minnesota
An LLC (aka Limited Liability Company) is a hybrid business entity combining a corporation’s characteristics with a partnership or sole proprietorship. It separates your personal assets from your business assets, thus giving you personal asset protection. For an LLC, members’ personal assets are not affected by business debts. However, in some cases, if the LLC is sued for business debts, courts might pierce the corporate veil and use the owner’s personal assets to meet their corporate liabilities.
If you wish to start an LLC in Minnesota, you must file your Articles of Organization with the State and pay a filing fee of $155. While it’s the most important step, it’s not the only one. There are 4 other crucial steps to follow to get your LLC formed in Minnesota. Below are all 5 steps that explain everything you need to do to start a Minnesota LLC in 2023. Let’s get started! You can always hire a professional LLC formation service in Minnesota to set up your LLC instead of doing it alone; a Pro service will ensure everything is done properly.
Step 1: Decide a Name for Your Minnesota LLC
The first step while forming a limited liability company in Minnesota is to give a proper name to your LLC. Before you name your business, you must know that the name should be easy to remember, available in the state, and follows all the LLC naming guidelines.
Minnesota LLC Naming Guidelines
There are a few specific requirements all the LLCs in Minnesota have to follow while naming their Company. Some of the most important requirements are as follows:
- Your business name should be available and no other existing business in Minnesota can have the same name. LegalZoom offers unlimited business name searches without any hassle.
- “Limited Liability Company”, “LLC”, and “L.L.C.” – any one of these has to be used as a suffix in your business name.
- You cannot use any name for your business that is confusing or misleading. Terms such as “Treasury”, “State Department”, “FBI”, “CIA”, etc. shouldn’t be included.
- Terms like “Bank“, “University“, “Attorney“, “Doctor“, etc can be added only after the additional requirements by Minnesota State Government are fulfilled.
- (Optional) It’s better to name your business something for which your desired domain is available.
|Important Links –||Submit Offline Form to –|
|Minnesota Business Entity Search – Online Search|
Name Reservation Form – PDF
Name Availability Standards – Guidelines
Minnesota LLC Name Search – Instructions
|Minnesota Secretary of State – Business Services|
Retirement Systems of Minnesota Building
60 Empire Drive, Suite 100
St Paul, MN 55103
Reserve Business Name for Future
If you do not wish to file your LLC right now but want to hold the name you have decided on, then you can reserve your LLC name for 1 year. To keep the name, you must file a name reservation application and pay $35 (by mail and $55 online or in-person) to reserve your name with the Minnesota Secretary of State.
Doing Business As (DBA) or Trade Name
Once you have a legal name for your LLC, you can register it. However, it is not mandatory. You can, instead, use DBA, Fictitious Name, or Trade Name. In that case, you must register your name with the Minnesota Secretary of State by submitting an Application to Assumed Name Registration in Minnesota along with the filing fee of $50 (online and $30 By mail)
Recommended: You can do name search, Trademark search, Trademark registration, copyright registration, and a lot more in one place by hiring a professional service. We recommend using –
LegalZoom – (Worry-free LLC Formation)
Apart from LLC formation, TailorBrands offers logos, customized website templates, and business emails at a very reasonable price. If you plan to get a website, then it is wise to have a “.com” domain for your business, but these days you can also use other TLDs like “.io”, “.company”, “.xyz,” etc. Here you can get everything you need for your business in one dashboard.
It is not legally mandatory to use the word LLC in your domain name or email. If you want, you can use it. However, it is recommended not to use LLC in the domain name. A domain name should be short and easy to remember.
Step 2: Assign a Registered Agent in Minnesota
The second step to forming an LLC in Minnesota is to appoint a Registered Agent. A registered agent is a person or business entity working on your LLC’s behalf. This person or business will receive important tax forms, legal documents, all notices of lawsuits, and other official government correspondence in Minnesota. Hence, hiring a competent Minnesota Registered Agent for your LLC is necessary.
Make sure your registered agent is a resident of Minnesota or has a physical street address. This address will be used as the principal address of your LLC to receive any legal documents. Most LLC formation companies also provide registered agent services. Below are two great LLC formation services; even if you buy their cheapest plan (normally $0), you also get registered agent service and other services at a very reasonable price.
These two are our top recommendations for registered agent service, as they are competent and authorized to conduct business in Minnesota. Some LLC formation services also offer standalone Minnesota registered agent services. You can purchase only Registered Agent services without purchasing any other LLC formation services. This standalone service might become handy if you are doing it yourself and don’t want to disclose your home address or you don’t want to pierce the corporate veil.
A person above 18 years of age and has a physical address in the state of Minnesota can be a Registered Agent. A Registered Agent can be an independent person or can be a business entity. One is responsible for handling all the legal documents on the LLCs behalf.
Yes, you can be your own registered agent if you are a resident of the state of Minnesota and you are above 18 years of age. To become a registered agent, you must have the authority to conduct any type of business in Minnesota.
There are a few reasons why you shouldn’t be your own registered agent. The address of the registered agent is used to communicate with the SOS or for any legal activities. If you are your own registered agent, you might have to upload your personal address to the public forum. Besides, the registered agent must be at the address during business hours. It won’t be easy for you as you also have to take care of other things in your LLC. Hence, it is wiser to appoint a separate entity as your registered agent.
If an LLC is sued in Minnesota, in some cases, courts might decide to lift the corporate veil, which means the owners of the LLC will be personally liable for their business debts. They might have to forgo their personal assets to repay their business debts. This is called piercing the corporate veil, where personal and business assets are not separated anymore. Your personal assets can be protected if you have enough capital and all your LLC documents are properly filed.
Registered Agent Consent Application
In Minnesota, there is no separate Consent Letter to be produced to the Secretary of State. At the time of change of Registered Agent (or the name or address), the new Registered Agent has to sign the consent letter. It comes with the Application form to Change the Registered Agent. The filing fee of $35 (by mail & $55 online or in-person) should be paid for it. For more information on the same, read our guide on Minnesota Registered Agent.
Step 3: File Articles of Organization in Minnesota
The third and most important step in forming a Minnesota LLC is to file the Articles of Organization. This Minnesota Articles of Organization is a legal document that is required to register your business with the Minnesota Secretary of State. It costs $155 (online and $135 by mail) to file your formation certificate in Minnesota.
The Articles of Organization include details like the name of the LLC, the registered agent’s name, address, employees’ details, and the company’s structure (member-managed or manager-managed). Before hiring employees in Minnesota LLC, one should know about the rules and regulations thoroughly. Also, if you are expanding your existing business (an LLC) in other states to Minnesota, you must register as a Minnesota Foreign LLC.
How to File Online
Go to the Secretary of State Online Service. You will get the online service page. You need to create your account with the online portal, then you can directly start filing your LLC by clicking on the “Online Filing” button below. Read more about the Minnesota Articles of Organization for online registration.
How to File by Mail
If you prefer filing real-life forms for your Minnesota LLC registration, then you can download Domestic LLC Formation Form. Read the form thoroughly, fill it out, and mail it to the following address,
Minnesota Secretary of State — Business Services
Retirement Systems of Minnesota Building
60 Empire Drive, Suite 100
St Paul, MN 55103
Processing Time: Normally, it takes around 1-2 weeks (approx) to get your LLC formed in Minnesota. The processing time for online filing might be a little faster than offline filing. With an additional cost, you can get expedited filing as well. However, the document processing time can be changed due to various factors.
Recommended: Online LLC Formation service can fill up and submit all these documents on your behalf in much lesser time along with lifetime customer support and 100% accuracy. We recommend using –
LegalZoom – ($0 + State Fees) Online LLC Setup
Every LLC owner has to pay the filing fees to register their business in Minnesota. This fee is mandatory but also tax deductible. If you’re doing it yourself (filing on your own), it will not cost you any additional service fee. However, it is not feasible to do that as the DIY process might be delayed, complicated, and messy, especially if you’re a novice entrepreneur. Hence, it is recommended to get professional guidance to get your LLC formed in Minnesota.
Step 4: Create Your Minnesota LLC Operating Agreement
Moving on to the fourth step, filing your operating agreement. An operating agreement is a document that legally outlines the proprietorship and operating procedures of your LLC. This document is vital as it ensures that all business owners are on the same page regarding how they operate, thus reducing future conflicts.
When it comes to filing a Minnesota LLC Operating Agreement, the state does not require you to have a comprehensive operating agreement, but it is ideal to have one that contains all the details of your business operation that helps in taking future business decisions, especially if you decide to dissolve Minnesota LLC later. Hence, having an operating agreement may not be necessary, but it is surely ideal.
Recommended: You can get operating agreement templates at a reasonable price with LLC formation service. You don’t need to worry about drafting it as they will take care of it on your behalf. We recommend using –
LegalZoom – ($0 + State Fees) Online LLC Setup
The operating agreement draft can be created for free if you don’t hire a professional. However, there is an advantage to appointing a proficient person/service. You will get a businesslike quality operating agreement at a very cheap fee, which will help you in the future. Hiring a professional service means you can sleep well at night 🙂
Step 5: Filing a Minnesota LLC EIN
The Employer Identification Number (aka EIN) is a nine-digit number given by the Internal Revenue Service (IRS) to make it easier to identify the type of business for tax purposes and taxes in general. The EIN is necessary for any active business or any form of business.
EIN is needed when the LLC hires employees. Hiring employees in Minnesota LLC requires following specific rules and regulations. On the other side, EIN for Minnesota foreign LLC should be obtained if your LLC is based in other states.
To obtain EIN (aka FEIN), one must fill up a form (Online or by mail) and submit it to the IRS. Enter details of your LLC, and finally, complete the form and send it to the address given. You can also get an EIN Assistant to help you with the process.
Mail to: Internal Revenue Service, Attn: EIN Operation, Cincinnati, OH 45999
Fax: (855) 641-6935 | Fee: Free
Recommended: This hassle will be reduced when you hire an LLC formation service. They take care of obtaining EIN and all other things for your LLC. We recommend using –
LegalZoom – ($0 + State Fees) Online LLC Setup
Note: You don’t need a Social Security number when getting an EIN. You can proceed to fill out I.R.S. Form SS-4 and leave section 7b blank. You must then call the IRS at (267) 941-1099 to complete your application. Agents or employees will help you with that.
Congratulation, you are now done with all the necessary steps to form your Limited Liability Company in Minnesota. If you do it yourself, it should take you a long time to understand and do all the steps properly.
However, if you use LegalZoom, it should be way faster. You will always have a live chat option and phone support with experts for any help you need. Their worry-free service will make things easier for you.
After Starting Your Minnesota LLC
After forming your LLC, there are still some things that you will need. The most important thing is to separate your business and personal assets. LLCs have limited liability protection that protects your personal assets from business liability. This is called a corporate veil. However, the corporate veil can be lifted or pierced by the court if the LLC is sued. In that case, the owners of the LLC become personally liable for their corporate debts. A few things like appointing a legit registered agent, having enough capital, and filing all the major documents with the state can save the LLCs from being pierced into the corporate veil.
Apart from that, there are a few things you need to take note of,
- Get a company business bank account
- File Minnesota business permits & licenses
- Get general liability insurance and professional liability insurance with coverage for employees.
- File a Minnesota LLC annual report or biennial report
This page has provided you with steps to LLC formation and filing processes. You now have to remember upcoming filing deadlines and filing fees or filing costs, including fees for late filings to make sure your LLC is up-to-date.
Cost of Minnesota LLC
LLCs can be formed by spending very less price. Apart from the mandatory state filing fees, you don’t have to bear additional service charges if you do it yourself. Following are the fees and taxes LLCs in Minnesota must pay to register and run a business in the state. Forming an LLC is no doubt cost-effective compared to other business structures. However, the fees and charges (tax-deductible) that you must pay to the state, such as name reservation fee, name filing fee, LLC filing fee, and Franchise Tax & Sales Tax (If applicable). Here are the main fees and taxes you must pay while forming your limited liability company in Minnesota,
|Fees/Tax||Amount to be Paid|
|Name Reservation Fee (online)||$55|
|Name Reservation Fee (By mail)||$35|
|Articles of Organization Fee||$155 (online and $135 by mail or in-person)|
|LLC Annual Fee||$0|
In Minnesota, an LLC name reservation is not mandatory. You can register your LLC name at the time of registering your LLC. If you wish to hold the name for some time without registering your LLC, then you can do that online. Your LLC name will be reserved for 1 year without registering your LLC. It can be renewed by paying $55 (online or in-person and $35 by mail).
In Minnesota, an Annual Report has to be produced every year. It costs $0. Also, the State of Minnesota requires to pay a Sales Tax of 6.875%. Read our guide on LLC costs in Minnesota for more information.
Minnesota Foreign LLC
If you are interested in forming a Foreign LLC in Minnesota then you need to file the Certificate of Foreign LLC to the Minnesota Secretary of State. Foreign LLCs allow you to operate your business in more than one state. Along with the Certificate of Foreign LLC, you need to submit some more documents like the Certificate of Good Standing, etc. to the Minnesota SOS to form your foreign LLC in Minnesota. To know more in detail, check out our guide on Minnesota Foreign LLC.
Reasons to Start an LLC in Minnesota
Having an LLC in Minnesota brings a lot of benefits. The biggest advantage of a Minnesota LLC is a reduction in tax liabilities. Also, there is a business funding option for various businesses. If you have a woman-owned business, you will be able to get more tax benefits. There is a variety of business taxes in Minnesota. If LLCs hire employees then they might pay federal taxes for employment.
While forming an LLC in Minnesota, there will be tax classification options to select from. Choose wisely which tax structure is proper for your LLC. Read more on Minnesota’s classification of LLC tax. Other than these there are not many annual costs in Minnesota. There are a set of benefits for a foreign business entity, LLCs with employees, and other types of LLCs to run a successful business. Here are some of the benefits of having an LLC in Minnesota.
Resource available for entrepreneurs is huge
The biggest benefit of Minnesota LLC is the abundance of resources. If some business is purely based on new research and innovative ideas, the Minnesota government will help that LLC with resources. However, different programs for these resources to entrepreneurs are mainly listed under the Minnesota Department of Employment and Economic Development.
From business to business, the fund amount differs. For instance, the Job creation fund for an LLC may vary up to $1 Million. For loans, this amount may vary from $20,000 to $50,000.
The Minnesota Opportunity zone
All the LLC in Minnesota that is looking forward to a long-term investment start-up in the state but have low investment resources and income are included under this opportunity zone. Such LLCs will be eligible for some tax deferment, like a temporary basis; no income tax will be charged on the capital they gain and permanent removal from the list of taxed businesses based on their taxable amount out of their income gains.
Research and Development Tax Credit
There is a research and development department in almost every new startup that will help them explore future endeavors for future personal growth and the growth of humanity. Such R&D’s are appreciated by the government, and the tax that is leveraged over these centers is offered back as a credit to companies to appreciate their good work and motivate them for the future.
The environment is positive for LLC
If a new business, which wants to start an LLC in Minnesota, looks at the survival rate of the new LLC, then it is huge. More than 57 percent of the new business is accomplished in the state. This is the strong engagement of a local person, which helps in easing the processing services of establishment and managing.
Best Businesses in Minnesota
Before you form an LLC in Minnesota, go through the below-mentioned top businesses in the state. Not only are they the Top Businesses in the state, but their contribution to annual GDP is also immense.
More than 74,500 farms in Minnesota state, providing raw material to more than 1000 agricultural firms. The primary sector of agriculture is contributing around $75 billion to the State. Moreover, the State also ranks 4th in milk production, which shows a significant contribution of dairy into the business.
The manufacturing business is rising day by day, resulting in around 8300 active manufacturing firms in the State. The employment provided by the manufacturing sector has risen by 11% from the year 2010 to 2019, with a total contribution of $55 billion. This amount is 1/6th of the total GDP of the State. Moreover, the competitive business environment in the State is giving better options of growth to new manufacturing businesses.
The State’s service industry is one of the greatest contributors to the economy and has employed 3/4th of the working population. Educational services and health care are the biggest ones that contribute to around $36.34 billion to the state GDP, followed by wholesale and retail trading.
There are small businesses also that are established very well in the State. They are mentioned below.
- Giving music lessons
- Opening a recruiter agency for the manufacturing and service sector
- Being a virtual assistant for companies
Minnesota LLC Formation Review
Time needed: 5 minutes.
Just to recap, here are the easy steps again when forming an LLC in Minnesota. Click on the steps in this list to read the full detail.
- Name your Minnesota LLC
The first thing you must do is to choose a company name, which should be unique, easy to find, and available in the state.
- Choose a Registered Agent
In Minnesota, it is mandatory to select a registered agent for your LLC. Get a professional Registered Agent from LLC formation services to get things done hassle-free.
- File a Formation Certificate
Filing a formation certificate is necessary when forming an LLC in Minnesota. Depending on the state, it could be called any of the following: Certificate of Formation, Articles of Organization, or Certificate of Organization.
- Create an Operating Agreement
An operating agreement is not a strict requirement in Minnesota but something encouraged when you start an LLC to avoid future conflicts.
- Get an EIN
The Employer Identification Number (EIN), also called Federal Tax Identification Number, serves to identify a business entity like a social security number but for a company.
How Fast Can I Form an LLC in Minnesota
For filing for Minnesota LLC, both online and mail services take up to 1-2 weeks, based on the number of applications received.
Forming an LLC can be a great business move, providing a range of benefits for entrepreneurs, including personal asset protection, liability protection, and a streamlined tax structure. However, the process of forming an LLC can often seem daunting and complicated, leaving many business owners wondering just how fast they can form an LLC in Minnesota.
Fortunately, the process of forming an LLC can be relatively quick and straightforward for those who are familiar with the process. The first step in forming an LLC in Minnesota is to choose a unique business name that is not already in use by another company in the state. This can be done easily by conducting a search of the Minnesota Secretary of State’s website, which maintains a database of all registered businesses in the state.
Once a unique business name has been selected, the entrepreneur must file articles of organization with the Minnesota Secretary of State’s office. This can be done online through the state’s website, by completing a paper form and mailing it in, or by having an attorney assist with the filing process. The articles of organization typically include basic information about the LLC, including the business name, the names and addresses of the LLC’s members, and the LLC’s registered agent.
After the articles of organization have been filed, the LLC should obtain a federal tax identification number or an employer identification number (EIN) from the Internal Revenue Service. This number is necessary for tax reporting purposes and can be obtained quickly and easily online by visiting the IRS website.
Once the LLC has been registered with the state and has obtained an EIN, the business owner can then take additional steps to establish the LLC, including opening a business bank account and obtaining any necessary permits or licenses. While the process of forming an LLC in Minnesota can typically be completed relatively quickly, it is important to note that timeframes can vary depending on the complexity of the business structure and the requirements of the state and local government agencies.
Overall, for entrepreneurs looking to form an LLC, the process can be relatively fast and straightforward in Minnesota. By following the basic steps outlined above, business owners can establish a new LLC and take advantage of the various benefits of this business structure in a timely manner. However, it is always important to consult with legal and financial professionals to ensure that the LLC is set up properly and that any relevant guidelines or regulations are being followed.
If you are a resident of Minnesota, then you can file your LLC by yourself. However, it is always worth having a professional than doing it yourself to handle legal complexities, paperwork, and other documentation.
Apart from the formation fee of $155 (domestic LLC) and $205 (foreign LLC), LLC costs in Minnesota do not include fees for Annual Reports as it is free. LLCs are liable to pay sales tax of 6.875% every year.
It takes 7 to 14 business days to get a Minnesota LLC if you file it online or via mail. If you hire a professional LLC service, then it might take less than that. We recommend TailorBrands which has impeccable turnaround time.
Every year all the LLCs have to submit an Annual Report for free to the Minnesota Secretary of State and renew the LLC. It is mandatory to renew your LLC every year.
Generally, for the LLCs, it is a default tax structure. Once you will obtain the EIN, you will get the various tax structure options to select. Sometimes LLCs choose S Corp to reduce federal tax burdens. Read more on the Minnesota Classification of LLC Tax.
LLCs are easier to establish than other business structures. Small businesses, especially start-ups can easily start their LLCs in Minnesota at a bare minimum cost. LLCs have a ‘pass-through taxation’ advantage for which they are excluded from certain taxes. The formation of limited liability companies requires much lesser documents and legal processes. Share your queries with us, and leave a comment below.