How much does an LLC cost in Minnesota? (details)
Forming a Minnesota LLC entails more than just paying the first filing fee; it doesn't have to be extremely expensive.
We outline all up-front and continuing costs for a Minnesota LLC and advise how to successfully cut these out of the budget.
How Much Does It Cost to Start an LLC in Minnesota?
There is a $155 filing fee for the Articles of Organization with the Secretary of State when forming an LLC in Minnesota.
This is important in creating your LLC's legal standing, allowing it to function under Minnesota regulations if approved.
Apart from the LLC filing fee mentioned above, additional expenses are associated with establishing a Minnesota LLC (Limited Liability Company).
Costs of Forming a Minnesota LLC
Forming an LLC includes a one-time state filing fee of $155.
There are also ongoing fees which we discuss below.
LLC Costs in Minnesota
| Requirement | Cost |
|---|---|
| LLC Name | $0 |
| Registered Agent | $0 or $125 per year |
| Articles of Organization | $155 |
| Operating Agreement | $0 (free on our site) |
| EIN Number | $0 (free to the IRS) |
| Annual Report | $0 |
| Taxes | varies (filed and/or paid every year) |
The filing fee for a Minnesota LLC Articles of Organization is $155
In Minnesota, forming an LLC requires paying the Secretary of State a $155 filing fee for the Articles of Organization. This paper creates your LLC legally if it is accepted.
After formation, you only need to pay the $155 one-time charge; after that, you won't need to pay any more monthly or yearly fees to keep your Minnesota LLC active.
✎ Note:
LLCs represent the predominant business structure in Minnesota, chosen for their robust liability protection afforded to owners, making them highly favored among business entities.
The form used to establish an LLC can vary by state; it may be referred to as the Articles of Organization.
In Minnesota, it is specifically known as the Articles of Organization. Despite these variations in naming, they all serve the same purpose to legally create your LLC.
Reserving a business name in Minnesota entails a fee of $0
The creation of your Minnesota LLC Name Reservation is completed simultaneously if you want to file online. An additional $0 filing fee is required for an online name reservation when filing online.
If you want to file by mail, remember to include the Name Reservation with your application.
But before forming your LLC, you have to wait for the Name Reservation to be approved. Even though filing by mail can save you a few bucks, it can take longer to form your LLC.
How much does a DBA cost? ($30)
In Minnesota, a DBA is filed with the town clerk rather than the Secretary of State. Therefore, the cost of a DBA will vary depending on the town where your LLC is doing business.
✎ Note:
A DBA, also known as a Trade Name, Fictitious Name, Assumed Name, or Fictitious Business Name, refers to the same concept.
★ Tip:
Obtaining a DBA for your LLC is optional and not a requirement.
Minnesota Registered Agent Fee ($0 to $125/ annually)
Under Minnesota law, every LLC formation requires the appointment of a Registered Agent.
Your Minnesota Registered Agent acts as the liaison for legal documents and state notifications on behalf of your LLC, necessitating a physical address within the state and availability during regular business hours.
You can appoint yourself, a trusted associate, or a family member as your Registered Agent without incurring additional expenses.
Alternatively, hiring a Registered Agent service costs between $100 and $300 per year. These services offer additional business support and safeguard your privacy.
Hiring a Registered Agent service is a good idea if:
- You lack a physical address in the state (Minnesota law mandates Registered Agents to have an address within the state).
- You prefer to keep your address private (some companies allow you to use their address for confidentiality).
Exclusive Offer!
Hire a Northwest Registered Agent to form your LLC for just $39 plus the state fee and receive a free year of Registered Agent service.
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LLC Operating Agreement Fee ($0)
A Minnesota LLC Operating Agreement functions as a written contract among the LLC's members. It outlines specific details regarding ownership, how the LLC is managed, and the distribution of profits.
Both Single-Member and Multi-Member LLCs should create an Operating Agreement, maintain it within their business records, and provide each member with a copy.
Online services generally charge between $50 to $200 for crafting an LLC Operating Agreement.
LLC EIN Number Fee ($0)
An EIN, also referred to as an Employer Identification Number or FEIN (Federal Employer Identification Number), is essential for handling tax filings, setting up an LLC bank account, and potentially facilitating employee hiring.
While some platforms may charge a fee, you can obtain an EIN for your LLC free of charge directly from the IRS. The process to apply online is simple and typically takes only a few minutes to complete.
Minnesota LLC Annual Report Fee ($0/year)
In Minnesota, the LLC Annual Report is referred to as the Periodic Report.
The state requires you to keep your LLC's information up to date by filing a Minnesota Periodic Report annually.
This keeps your LLC in good standing and compliance with state law so it can continue operating. You simply confirm the information on your Periodic Report, file it with the Minnesota Secretary of State, and pay the Periodic Report filing fee.
The Minnesota LLC Periodic Report is free annually. These costs are required each year for the duration of your LLC's existence.
✎ Note:
Other business entities may file different reports, but LLCs only need to file the Periodic Report each year.
Minnesota Business License and Permit Fees
The locations and industry sectors in which your LLC operates in Minnesota may require you to apply for additional business licenses or permits. For your LLC's specific operating area, for example, it may be necessary to obtain a city business permit.
Location and industry specifics can affect the cost of these licenses or permits. These costs are usually fair. Local governments such as towns, cities, or counties are responsible for administering some licenses and permits, while the state issues others.
LLC Taxes
Minnesota LLC owners face a range of tax obligations, leading to varying annual costs.
Some of the taxes LLC owners pay include:
- Federal taxes
- State income tax
- Local income tax
- Business taxes
- Self-employment taxes
- Sales and use tax
- Payroll tax (if you have employees)
- Property tax (if the LLC owns property)
The Taxes of Your Minnesota LLC taxes are affected by your industry and business activities, making it difficult to predict. Every business is different, and the taxes your LLC owes depend on your specific situation.
✎ Note:
Typically, a Single-Member LLC is taxed similarly to a Sole Proprietorship, while a Multi-Member LLC is taxed similarly to a Partnership.
Hiring an Accountant
Accounting fees can vary, but in general, expect to pay about $300 a year for basic tax returns and up to $900 for more comprehensive filings.
The best person to help you determine your small business tax liability in Minnesota is a certified accountant.
While accounting costs can vary, you should generally budget $300 for simple tax returns and up to $900 for more complicated filings annually.
Need to save time?
Consider hiring a professional to set up your LLC: Northwest Registered Agent offers LLC formation services starting at $39 plus the state fee.
(Find out why Northwest is the top choice for LLC formation)
✎ Note:
Accounting fees can vary, but in general, expect to pay about $300 a year for basic tax returns and up to $900 for more comprehensive filings. We recommend speaking with a few Minnesota accountants to make sure they can help you with all of your local, state, and federal tax needs. For more advice, see our comprehensive guide on how to find an accountant.
Minnesota Secretary of State
If you're curious about the expenses involved in starting a Minnesota LLC, feel free to contact the Minnesota Secretary of State for detailed information.
Minnesota LLC Costs FAQs
How much does it cost to open an LLC in Minnesota?
It costs $155 to start a Minnesota LLC. This is a one-time filing fee for the LLC Articles of Organization.
Some LLCs may need a business license in Minnesota. This depends on your industry and where your LLC is located. The cost of local business permits varies.
How much does an LLC in Minnesota cost per year?
All Minnesota LLCs need to file an Annual Renewal each year, but there is no fee to pay for this filing. The Annual Renewal requirement applies to all Minnesota LLCs.
If you hire a Registered Agent service, you’ll have an annual subscription fee to pay each year. This is usually about $125 per year.
Some LLCs may need a business license in Minnesota. This depends on your industry and where your LLC is located. You’ll need to check with your municipality to see if there are any annual renewal fees for the business permit.
Should I hire an LLC formation service?
You aren’t required to hire a professional service company to form your Minnesota business entity. A business owner is allowed to complete the LLC formation process themselves if they want to. You can do the online filings yourself.
Do I need to hire an attorney to form an LLC?
No, you aren’t required to hire an attorney to form your LLC in Minnesota. You’re allowed to form your LLC yourself if you’d like.
However, some people may want to hire an attorney if their LLC has a complex ownership or management structure, has investors, or requires industry-specific documentation.
A business attorney usually charges between $800 and $2,500 to form an LLC.
How do I start an LLC in Minnesota?
Here are the steps to starting an LLC in Minnesota:
- Choose an LLC business name and make sure it’s available
- Choose who will be your Minnesota Registered Agent
- File the Minnesota Articles of Organization
- Complete and sign an LLC Operating Agreement
- Get a Tax ID Number (EIN) from the IRS
- Open an LLC bank account
- Check whether you need a business or sales tax license in Minnesota
What’s the cheapest way to start an LLC?
You can get an LLC cheaply by filing your formation documents yourself. You’ll also save money by being your Registered Agent and using our free LLC Operating Agreement template.
By forming your LLC yourself, being your Registered Agent, and using our Operating Agreement template you can save over $400.
How long does it take to get an LLC in Minnesota?
How long it takes to get an LLC in Minnesota depends on how you file your Articles of Organization.
If you file by mail, you can get an LLC in Minnesota approved immediately. On the other hand, filing by mail takes about 11-12 business days (plus mail time).
How much does a Minnesota business bank account cost?
It varies. Some banks charge monthly fees ($10 to $20 per month), but these can sometimes be avoided by meeting certain requirements. For example, if you make a certain number of direct deposits or maintain a specified minimum balance, then they’ll waive the monthly fees.
And you might be able to find a bank that doesn’t charge any monthly fees.
Before you open your LLC business bank account, we recommend calling and asking if there are ways to avoid the monthly maintenance fees.
How much is a Foreign LLC in Minnesota?
A Foreign LLC is an LLC formed in another state that must register (aka foreign qualify) in Minnesota. This is because the LLC is doing business in both states.
The Minnesota Foreign LLC cost is $185 if you file by mail. If you file online or need expedited service, the cost is $205. This is the form to file when you register an LLC in Minnesota after it was formed in another state.
If you form an LLC in Minnesota, it is called a “Domestic LLC”. If you formed your LLC in another state, it would be a Foreign LLC once you register it in Minnesota.
Is Minnesota a good state for an LLC?
Yes, Minnesota is a great state to start a business. Minnesota doesn’t charge a state business license fee, has quick approval times, and helpful representatives at the Secretary of State if you have questions.
However, the most important factors in deciding where to start a business are where you live and where you’re doing business.
Meaning, if you live in or do business in Minnesota, then you should start your business in Minnesota. While many websites talk about tax rates and the advantages of certain states, none of that applies if it’s not the state where you live and do business. And just because a certain state has cheaper LLC fees doesn’t mean it’s a good idea to form your LLC there.
For example, if you form an LLC in Wyoming, but live in and conduct business in Minnesota, you’ll also need to register your Wyoming LLC in Minnesota (and pay fees). And you’ll end up paying Minnesota taxes anyway. This ends up leading to more costs and more headaches with no advantages.
In summary, if you are a Minnesota resident, then yes, Minnesota is the best state to form an LLC. If you don’t live in and do business in Minnesota, then no, Minnesota probably isn’t a good state to start an LLC.