Some entrepreneurs toil with a business idea for years while others pursue their business plan in short order. No matter how long you’ve mulled over your concept when you’re ready to launch, it’s exciting.
To launch a business in the State of Minnesota, an entrepreneur sets up a business by filing LLC formation paperwork and selecting a registered agent. A registered agent is a point of contact for the company that will receive official documents for the company.
While this process might be new to you, it’s actually fairly simple. To help start-ups get off the ground in The North Star State, here’s a look at how to set up a Minnesota LLC and select a registered agent that best suits your new company.
How is an LLC formed in Minnesota?
In Minnesota, entrepreneurs need to file LLC formation paperwork, which, in Minnesota, is called Articles of Organization. Before filing this paperwork online, there are a few things you need to do first. Here’s where to start:
1. Name the company
One of the first things you need to do to establish a company in Minnesota is select a company name. It’s an important choice; one that will stick around for years. The longevity of the name is certainly a concern, but there are also naming rules established by the state that entrepreneurs must follow too. The rules include:
- The name must be unique. No two businesses in the state can have the same name. To see if the name you want is available in Minnesota, check the business database on the secretary of state’s website.
- A name can be reserved through the Minnesota Secretary of State’s website up to 12 months before filing the LLC formation paperwork for a $50 fee.
- The name must include the phrase “Limited Liability Company” or “LLC” in it.
- The name can’t be confused with any government agency.
- Some names may require additional approval, like company names that include words like “financial institution” or “school.”
Now is also a good time to check on the status of a company domain. Ideally, the company website will have a URL that matches the company name. It’s best to look into this before officially selecting a company name.
2. Pick a registered agent
When you go to file the Articles of Organization, you’ll be asked to select a registered agent. A registered agent is the contact person for the company that will receive official documents for the company by mail or delivered in-person. This person can be the owner, an employee, or the owner might decide to hire a registered agent service to fill this role.
The person’s name and address are listed on the LLC formation paperwork, so you need to know who your registered agent is before filling out the document.
3. File the Articles of Organization
Once you have the company name set and know who you plan to elect as a registered agent, you’re ready to fill out the LLC formation documents known as Articles of Organization. This document takes minutes to fill out, as long as you know the company is available and who the registered agent will be.
Entrepreneurs can file this document online, send it through the mail, or deliver it to the Minnesota Secretary of State’s office in person.
Aside from the company name and information regarding the registered agent, the document will also ask about the company’s start date, managing members, and which products or services the company will provide. Lastly, the LLC organizer needs to sign and submit the document.
The fee to file this paperwork with the state is $155 for online filings and $135 for mailed submissions.
4. Create a company operating agreement
Once the Articles of Organization are filed and accepted, the company officially exists in the state. While the LLC is legally established, there are a few other steps you’ll need to take to open to the public. For starters, you should create an operating agreement.
An operating agreement is a contract that explains how the company will run, who the investors are, and how profits and losses are doled out. It’s important to create this document before opening to avoid problems in the future.
The state doesn’t require a copy of the operating agreement, but business experts strongly suggest creating one at this point in the set-up process.
5. Obtain an EIN
Every business needs an EIN or an employer identification number. This number is a lot like a social security number, it’s a form of legal identification that’s required to do many tasks, including opening a bank account, getting a business loan, hiring employees, and paying taxes.
To get an EIN, go to the IRS website, fill out a series of questions and you’ll receive the number instantly. The process takes about 5-10 minutes.
6. File an annual renewals
Every LLC in Minnesota must file a renewal once a year before the end of the calendar year. To file this report online, there’s a $45 fee.
Filing an annual renewal is fairly common in most states. Some states call it an annual report, but the concept is the same, the state wants to make sure that the company is still running and in good standing.
What is a Minnesota registered agent?
A Minnesota registered agent is a person or company that receives official documents on behalf of the company. This person could receive legal notices, tax documents, or service of process papers that are served during a lawsuit.
Given the sensitive nature of the documents received, it’s important that the person or company selected be trustworthy and have the ability to contact the owner immediately.
Do I really need a registered agent in Minnesota?
Yes. The state requires all LLCs to list a registered agent on the LLC formation paperwork. The state needs a way to contact the company’s owner, which is why a registered agent must be listed.
Can I be my own registered agent in Minnesota?
Yes. An owner can be their own registered agent, and actually, it’s a fairly common practice. However, the owner may choose a different person or even a company, known as a registered agent service, to fill this role.
Who can be a registered agent in Minnesota?
In Minnesota, a registered agent can be a resident of the state or a company in good standing that operates in Minnesota. Both the resident and the company must have a physical street address, not a P.O. box., and must be available during regular business hours.
Documents like service of process papers are served during regular business hours, which is the reason for the daytime availability.
Why would a company choose to work with a registered agent service?
An owner can pay a registered agent service to be the company’s registered agent. Since the role is fairly simple to fill yourself, you might wonder why some entrepreneurs opt for a service. Here’s a look at a few benefits of using a registered agent service as opposed to doing the job yourself:
- Availability. Some owners aren’t available during regular business hours. Some owners bounce between multiple businesses, others travel a lot. For some owners, paying a registered agent service is easier since their days are tied up out of the office.
- Peace of mind. A registered agent service provides peace of mind to owners. With service in charge, the owner knows that documents aren’t missed.
- Privacy. As mentioned, some of the documents that a registered agent receives are confidential. Some owners prefer that these documents are served offsite to maintain a certain level of privacy from prying eyes.
List of Minnesota registered agent services
There are many registered agent services in Minnesota. The secretary of the state usually maintains a list of options, but here are a few services that are available. These companies not only offer registered agent services but also offer other services that a budding LLC may need:
- Incfile.com: Incfile.com can help entrepreneurs file their LLC formation paperwork and serve as the company’s registered agent. The online company offers a host of beneficial business services that includes filing reports and other necessary documents with the state. The first year is free. After that, it’s $119 a year.
- Northwest Registered Agent: For $125 a year, Northwest Registered Agent offers an online portal, real-time updates when mail is received, and pricing that remains the same each year. The company offers its services in several states and has years of experience in the field. Additional business services are also offered.
- Swyft Filings: Swyft Filings offers registered agent services that start at $149 a year. Users get an online dashboard, report and filing reminders, and secure document storage for this fee. In addition, the company has a buffet of other business services available when you have a need.
How much does a registered agent service cost in Minnesota?
The cost of a registered agent service will depend on the kind of services you want. For basic services that simply notify the owner when a document comes in, expect to pay about $50 a year. For more advanced features like online portals, file storage, report reminders, and compliance assistance, expect to pay between $100-200 a year.
How does an owner select a registered agent in Minnesota?
The owner lists the registered agent on the LLC formation paperwork and files it with the secretary of state.
Can a company change its registered agent?
Yes. To do so, entrepreneurs can file a Change of Registered Agent form with the Minnesota Secretary of State and pays the $55 fee.
What’s a statutory agent?
A statutory agent is the same as a registered agent. The title varies by state. In Arizona, for example, a company’s point of contact is called a statutory agent. Resident agent and service of process agent are also used in other states.
What’s a commercial registered agent?
A commercial agent is a registered agent service that you pay for. A non-commercial agent is someone that’s not paid to fill the role, like the owner or a friend.