When starting a Montana limited liability company (LLC), you’ll need an accurate estimate of the startup costs to decide how to manage your funds and expenses.
But accurately estimating those costs can be tricky.
You have essential spending such as company business formation costs and state fees.
Then some other necessary expenses like acquiring business licenses or permits, drafting an operating agreement, filing an annual report, securing business insurance. These will also rack up your bill.
To stop you from being blindsided by the formation and ongoing administrative costs, this guide highlights all Montana LLC costs you should consider.
Montana LLC formation cost: $70
An LLC is one of the most popular business structures among entrepreneurs because it offers liability protection for your personal assets and tax advantages.
To register an LLC, you’ll need to file Montana Articles of Organization with the Montana Secretary of State (SOS). Submission must be done online.
Once the SOS receives your legal documents, it’ll take 7-10 business days on average to process and approve your application to start your Montana LLC.
If you need to form the company quickly, expedited services are available at an additional cost:
- 24-hour priority handling for all documents: $20
- 1-hour expedited filing for all documents: $100
Extra Montana LLC costs to account for
Other optional fees may apply too. Most of these vary depending on your industry and scale of business.
We’ve broken down these extra costs below to help you estimate how much you’ll need to spend to start your Montana LLC.
Registered agent costs: vary
All LLCs are required to appoint a registered agent to accept service of process and other legal documents and official correspondence on behalf of the business.
A registered agent can be an individual or business entity. So, you may elect an individual in the company, such as an employee, member, or other trusted person.
You can also be your own registered agent. That’s usually the case for single-member LLCs, where one owner has complete control over the business. Multi-member LLCs with at least two business owners can also appoint someone within the LLC.
Montana does not charge a separate fee for appointing a registered agent. Neither you need to pay fees if you decide to change your registered agent details later.
To become a Montana registered agent, you must:
- Be 18 years or older
- Have a physical address (no P.O. Box or mailing address) in Montana
- Be present (in-person) during regular business hours to receive service of process and other legal paperwork
You can also hire a commercial registered agent service to help you stay compliant and atop of important filing deadlines. They can also prevent embarrassments such as receiving lawsuits before potential clients and protect your privacy.
Professional registered agent service providers offer year-round, full-time availability. Plus, your Montana business address and LLC formation documents won’t be publicly accessible, as the state will only have the registered agent’s address on file for your company.
Hiring a commercial registered agent service in Montana typically costs around $50-$300 per year. It’s a small price considering how much time and money you’ll save yourself.
Trade name registration: $20
If you don’t wish to use your company’s full legal name for all its activities, you can register a trade name or “doing business as” (DBA) name.
A DBA allows you to run your LLC under a different title to protect your privacy, expand into other markets, and market several lines of business separately.
Pick a unique name (not already in use in Montana) to avoid legal action and customer confusion. The name should also support your brand, be reflective of your business activities, and be web-friendly if you need a domain name for the company.
To register your Montana LLC’s trade name, you’ll file a “Registration of Assumed Business Name” form and pay the $20 filing fee. This filing is online too.
Montana LLC name reservation: $10
When starting an LLC, one of the first steps is registering a business name. But before that, you’ll need to do a name search to determine its availability. Only then proceed with the LLC registration.
If you’re not ready to form the business yet, you can reserve the selected name to prevent another company from taking it.
To do so, file a Reservation of Name form and pay the $10 filing fee. The state will reserve your business name for up to 120 days before you file your formation documents.
If you want to register an entity name for a foreign LLC but not operate your small business in Montana, you can file a Registration of Foreign Business Name online for $10.
Certified document copies: costs vary
Certified document copies are a reproduction of your LLC’s filed formation documents.
You can obtain these copies by ordering through the Montana SOS website and paying the $10 fee per copy. A $5 fee will apply for documents or copies returned via fax.
Business permits and licenses: costs vary
Depending on the type of business, location, and industry, you may have to pay for business licenses and permits.
Montana doesn’t have a general state business license. And you’re not required to have a seller’s sales tax permit to operate in the state because there’s no state sales tax.
However, if you operate in a regulated industry, such as medical, legal, accounting, or teaching, you may need to apply online for an occupational or professional license. The state fees and details of business licenses and permits vary depending on the occupation.
For example, a Certified Public Accountant (CPA) will pay $150-$200 for a professional license, while a chiropractor will pay $300. A liquor license costs between $200 and $400.
Does Montana have an annual LLC fee?
Yes. Once you form your Montana LLC, you must file an annual report online by April 15th of each year and pay the $20 fee. That way, you’ll stay in good standing with the state and avoid unnecessary penalties or fines.
Missing the due date attracts a $15 late fee, while continuous failure to file could lead to your LLC’s dissolution.
What taxes do LLCs pay in Montana?
Montana lacks many of the state taxes that you might be accustomed to.
It doesn’t impose franchise taxes or state sales tax on taxable goods or services. So, you won’t be required to have a sales tax permit.
However, the state collects local business taxes covering specific locations, services, or businesses like health care, telecommunications, tourism, and more.
Additionally, if your company owns a property (including real estate and business equipment), you must submit Montana Personal Property Assessment and pay applicable taxes.
If you have employees in Montana, you’ll need to register with the Montana Department of Revenue for employee withholding tax and the Montana Department of Labor & Industry for unemployment insurance tax.
LLCs with employees will also need an employer identification number (EIN), which is like your business’s Social Security Number. You can get one for free from the IRS website.
Conclusion: How much does an LLC cost in Montana?
The initial cost to start an LLC in Montana is $70 to file Articles of Organization. This document officially incorporates your LLC.
Other costs you may incur in the first year include:
- Trade name registration – $20
- Name reservation – $10
- Annual report – $20
- Commercial registered agent service – $50 – $300 (annually)
- Occupational licenses/permits – $25 – $1,000
Montana doesn’t impose a state sales tax or franchise tax. Instead, you may only pay local business taxes depending on your location and type of activity. And if you have employees, you’ll also need to pay unemployment insurance tax.