How to Start an LLC in Minnesota: If you’re interested in setting up a Minnesota LLC, you’ve come to the right place. Having an LLC not only protects your personal assets but also is less complicated than other business structures. Minnesota laws make it easy to establish your LLC in Minnesota. On this page, You’ll find all the steps that must be taken to ensure that your Minnesota LLC has been correctly established. 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 or a 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.
If you wish to start an LLC in Minnesota, you mainly have to file your Certificate of Formation with the State and pay a filing fee of $155. There are some more steps to follow to get your LLC established in Minnesota. The following steps explain everything you need to create your LLC in Minnesota in 2022. Let’s get started! It is always recommended to hire a professional LLC formation service in Minnesota to set up your LLC.
Step 1: Decide a Name for Your Minnesota LLC
The very first step while forming an LLC 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. Perform a name search from the below-mentioned source to be sure your name isn’t taken already.
- “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 then you can reserve your LLC name for 1 year. To keep the name, you have to 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)
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TailorBrands – ($49 + State Fees) Online LLC Setup
TailorBrands offer DIY website templates and incredible logo designs. 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 “.company”, “.xyz” etc. With TailorBrands, you can get everything you need at an affordable price.
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 a Minnesota LLC is to appoint a Registered Agent. A registered agent is a person or business entity that will act or work 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. Their business address or the principal address should be in Minnesota. Most LLC formation companies also provide registered agent services. Below are two great LLC setup services, even if you buy their cheapest plan (normally $49/year) you also get registered agent service and other services at a reasonable price.
These LLC formation services are recommended registered agent services as they are authorized to conduct business in Minnesota. Some LLC formation services offer standalone Minnesota registered agent services. You can purchase only Registered Agent services from them without purchasing any other LLC formation services.
A person who is 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 who is responsible for handling all the legal documents.
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.
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 Certificate of Formation. This Minnesota Articles of Organization is a legal document needed to officially register your business with the Secretary of State. It costs $155 (online and $135 by mail) to file your formation certificate in Minnesota. (Read more on LLC cost in Minnesota).
The Certificate of Formation includes details like the name of the LLC, registered agent’s name, address, employees’ details, and structure of the company (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) to Minnesota then you need to 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: It takes 1 to 2 weeks to form an LLC in Minnesota (online or by mail). By paying an additional fee, it can be expedited.
Recommended: Online LLC Formation service can provide all these documents within 6-8 days with lifetime customer support and 100% accuracy. We recommend using –
TailorBrands – ($49 + State Fees) Online LLC Setup
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. Like Minnesota, there are other states that do not have a mandatory rule to file operating agreements. But, this document would be useful if you decide to dissolve Minnesota LLC later. Hence, having an operating agreement may not be necessary but it is definitely ideal.
Recommended: You can get operating agreement templates at only $29 with TailorBrands. You don’t need to worry about drafting it as they will take care of it on your behalf. We recommend using –
TailorBrands – ($49 + State Fees) Online LLC Setup
Step 5: Filing a Minnesota LLC EIN
The Employer Identification Number or, simply, the E.I.N. 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 for that matter.
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 has to 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 who can help you with the process.
Mail to: Internal Revenue Service, Attn: EIN Operation, Cincinnati, OH 45999
Fax: (855) 641-6935 | Fee: Free
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TailorBrands – ($49 + 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 Minnesota LLC. If you do it yourself it should take you a long time to properly understand and do all the steps.
However, if you use TailorBrands, it should be way faster. You will always have a live chat option as well as 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. Take note of the following:
- 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
Forming an LLC in Minnesota is no doubt more cost-effective than other structures of a business. There are some fees and charges one has to bear to form a Minnesota LLC. LLCs have pass-through taxation. Hence, your Minnesota LLC won’t bring you a massive tax burden. Here are some of the fees and taxes are needed to be paid while forming an LLC 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.
Having an LLC in Minnesota can be a lot of work. You’ll need to file Articles of Organization, have a registered agent and maintain annual compliance. You also need to make sure you pay your taxes on time to avoid unexpected costs. This can be time consuming and difficult, but it can save you money in the long run. If you’re having trouble with your filings, consult an attorney for guidance.
Your first step in forming an LLC in Minnesota is to choose a business name. The name of your business must be in English. If you are unsure of the name you’d like, perform a business name search with the Minnesota Secretary of State’s website. This can be very helpful in determining whether a name is available. If you are unable to find a name you like, you can choose to form an LLC with a different name. It is recommended that you choose a name that you’re comfortable with, especially if you plan to use the name for a business.
Once you’ve chosen a name, you’ll need to file Articles of Organization with the Minnesota Secretary of State. The state requires that you pay a $135 fee for filing. You can file your articles online or by mail. Alternatively, you can get an expedited filing for a $55 fee. If you need your filings expedited, you can get this service through a registered agent service.
An LLC needs a registered agent to be able to receive legal papers on behalf of the business. The registered agent must have a physical office in Minnesota and be available during regular business hours. You can either serve as the registered agent yourself, or hire a registered agent service to handle the paperwork. If you choose to serve as the registered agent, you’ll need to file a renewal every year. You’ll also need to open a bank account for your business. The bank account will allow you to keep your business and personal finances separate. You’ll need an EIN (employer identification number) to open a bank account. You’ll also need the EIN to file federal and state taxes.
You’ll also need to keep detailed records of all financial transactions and employee information. In addition, you’ll need to file annual reports. If you don’t file annual reports on time, you could face penalties. The penalty could be up to 15% of the tax owed for each 30-day period that you fail to file. If you miss your filing deadlines, you’ll also face the possibility of automatic dissolution. You can find more information about penalties and tax rates for businesses in Minnesota from the Minnesota Department of Revenue.
In Minnesota, you can file your articles of organization online or by mail. You’ll also need to have an operating agreement, a document that outlines the business structure and operations of your LLC. Using an operating agreement is a great way to prevent ownership disputes. You’ll also need to have a meeting, where you’ll adopt the operating agreement. You’ll also need to record the minutes of the meeting in a company record book.
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.