Are you thinking of setting up a new limited liability company (LLC) or opening another office for your LLC in the state of Minnesota? Then you’ll want to know the costs involved.
Company incorporation assumes paying some mandatory state filing fees.
On top of these, you should also budget for some “extras” — optional and operations-specific expenses you may incur.
Here’s a rundown of Minnesota limited liability company formation costs business owners should know.
Table of contents
- Minnesota LLC formation cost: $135/$155
- Extra Minnesota LLC costs to account for
- Does Minnesota have an annual LLC fee?
- What taxes do LLCs pay in Minnesota?
- Conclusion: How much does an LLC cost in Minnesota?
Minnesota LLC formation cost: $135/$155
First, let’s start with the essential formation documents — filing Articles of Organization.
The filing costs in Minnesota depend on the method of filing.
- Domestic LLC articles of organization cost: $135 by mail or $155 for online/in-person submissions.
- Foreign LLC articles of organization cost: $185 by mail or $205 for online/in-person submissions.
Why the price difference?
Because online and in-person filings are expedited, unlike mailed-in submissions. They are typically processed in under 7 business days.
Filings received by mail are processed on a non-expedited basis (first in/first out). Then mailed back to the submitter. The entire process can take up to two weeks (or more if there’s a backlog).
Extra Minnesota LLC costs to account for
Paying for Articles of Organization is the first (and sometimes only) mandatory cost you’d incur. Yet, there are several more things worth budgeting for.
Registered agent costs
While there’s not a separate fee for appointing a registered agent, there can be other costs associated with this.
A registered agent is in charge of receiving service of process of legal documents for your Minnesota business. You can designate yourself as a registered agent (assuming you meet the requirements). This is the free option.
However, sometimes it’s not practical to serve as your own registered agent. Because then you’d have to be available at the registered address during standard business hours each day. Likewise, your address becomes a public record. It’s inconvenient if you run a home-based business.
And so you may want to hire a commercial registered agent service. That runs at about $100-$300 per year.
If you decide to change your registered agent later down the road, you’d have to pay several fees for updating the details with the MN Secretary of State:
- Registered Agent Resignation: $35 if submitted by mail or $55 for in-person filings. Note that you can’t file this online!
- Registered Agent or Office Address Change: $35 for mailed in filings or $55 for in-person or online filings.
Assumed name registration
Assumed Name filings should be used when:
- An individual conducts business under a business name other than their full pull name.
- A corporation, limited partnership (LP), or LLC operates a business under a name other than the registered legal business name.
- There’s no mention of each partner’s full name in the general partnership name.
Also, no “Certificate of Assumed Name” is issued in Minnesota. Instead, you receive back an approved state form that you’ve filed. It then acts as proof of your assumed name registration.
The filing fee for your LLC assumed name with Minnesota filing is $50 for in-service and online filings (which gives you expedited service). Or $30 if submitted by mail.
Note: While there’s no annual fee, you need to review your LLC’s assumed name annually. If you’re late, you’d have to pay a fee to get your assumed name reinstalled.
Minnesota LLC name reservation
If you need more time to set up your new business, or you want to reserve your LLC name for some other reason, you have an option to do so.
The filing fee for the name reservation is $55 for expedited service (via in-person or online). Or if you file by mail to the Minnesota Secretary of State, it’s $35.
You can reserve a name for an additional 12 months.
Certified document copies
It’s highly recommended and sometimes required to obtain certified documents for your company documents. Here are the costs to expect:
- Copy of original filing or amendments: if by mail or in-person, $3; $13 online.
- Certification of filing(s): $5 per certification.
- Certificate of Good Standing (often needed if filing as a foreign LLC in another state): $5 for mail or in-person; $15 for online.
Business permits and licenses
Minnesota doesn’t require a general business license. If your LLC operates in a regulated industry, you may need an occupational license and other permits. The costs of these will vary. Check the Minnesota e-licensing portal for more information since it depends on what industry your LLC operates in.
Here are some ballparks:
- Acupuncturist license: $333.25
- Dietitian License: $150
- Notary public: $120
You may need to pay a sales tax on goods sold within the state. It will be 6.875% (plus any local taxes). To collect this tax, you’ll need a state tax ID (sometimes referred to as sales license/sales tax permit). The good news is that it’s free to request from the Minnesota Department of Revenue (DOR).
Does Minnesota have an annual LLC fee?
No, if your Minnesota LLC is in good standing, there’s no fee. But your small business will still need to submit an annual report by December 31st. If your LLC failed to file an annual renewal, then to retroactively reinstate its existence with the current year’s annual renewal, you’ll need to pay a late fee. It’s $25 if submitted by mail or $45 for expedited service in-person or online.
What taxes do LLCs pay in Minnesota?
Most LLC tax liabilities are with the IRS on the federal level.
But some local taxes can apply too. It can vary depending on your business entity. Some business structures have pass-through taxation. This is the case for LLCs, reporting taxes as a sole proprietorship or partnership.
In these cases, LLC owners report their share of their earnings on their personal tax returns and pay applicable personal income taxes. So your income tax rate will vary based on how much you earn from your LLC and any other sources of income.
If you pay personal income tax in Minnesota, the rates range from 5.35-9.85%.
However, you may also need to pay some extra local taxes such as:
- Sales tax: 6.875% (plus any local taxes)
- State employment taxes: If you have any employees on the payroll
- Corporate income tax: 21%. Applies only if you report federal taxes as a C-corporation
Conclusion: How much does an LLC cost in Minnesota?
First, expect a bare minimum of $135 to start an LLC in Minnesota. Though most likely, you’d opt for expedited service and pay $155. If you need to hire an LLC formation service, those costs will vary and will be added on top of any state filing fees.
You may also need a Minnesota registered agent with a registered office street address for your LLC in the state to receive service of process of legal documents, which may cost another $100-$300 per year.
Now there are some other fees that will depend on your business.
While not required, preparing an LLC operating agreement is usually a good idea. If you use a professional service to do this, there will be an additional fee.
Also, having a separate bank account for your LLC is necessary. The cost can run about $5-$15 per month (give or take, depending on the features you need and also look for fee waivers for maintaining minimum balances).
Finally, business licenses and permits will vary in cost, but if your LLC needs them, they will be an additional expense.