LLC Cost In Minnesota - How Much To Pay In Fees & Taxes in MN
If you are planning to start a new business in Minnesota, you will need to choose a business structure and consider all related costs, including filing fees, taxes, and additional state fees.
In the U.S., the most simple and beneficial form of business is a limited liability company (LLC).
In this article, you will learn about the LLC formation process and find answers to the following questions:
- How much is an LLC in Minnesota?
- What are regular Minnesota LLC fees?
- What is the cheapest way to start an LLC in Minnesota?
- What other paid services associated with business formation you may need?
If you want to learn in detail how to start an LLC in Minnesota on your own, make sure you check our step-by-step guide.
How Much Does an LLC Cost in Minnesota?
The main fee that determines the cost to start an LLC in Minnesota is the state filing fee. In Minnesota, you can file online or by mail:
- Online filing - $155 (nonrefundable);
- Filing by mail - $135 (nonrefundable).
Note that documents sent by mail usually take longer to process. You can download the necessary Articles of Organization form in PDF, fill it out, and file it with the Secretary of State by mail or in person.
Use the following address:
Minnesota Secretary of State — Business Services
Retirement Systems of Minnesota Building
60 Empire Drive, Suite 100
St Paul, MN 55103
The foreign LLC cost in Minnesota is higher:
- Online filing - $205 (for expedited online and in-person filings);
- By mail - $185 (for applications by mail, regular processing).
As for annual reports, in Minnesota, if the entity is active and in good standing, annual reports (annual renewal) can be filed with the Secretary of State for free.
You can file your annual report online or by mail.
Mail to:
Minnesota Secretary of State — Business Services
Retirement Systems of Minnesota Building
60 Empire Drive, Suite 100
St Paul, MN 55103
Due date: due by December 31 each year.
Note that the state will immediately dissolve your LLC if you do not file on time.
That said, let's break down all the fees in detail so you can accurately calculate the LLC cost in Minnesota.
Minnesota LLC Online Filing Fee
Legally, your LLC will be considered established once you have successfully filed your LLC Articles of Organization with the Secretary of State.
Thus, once your Minnesota LLC is approved, the information about it will be officially listed on the Minnesota Secretary of State's website.
The Articles of Organization document usually includes the following information:
- Name of the limited liability company;
- Registered agent office address and name (required);
- Period of Duration for the LLC;
- Names and addresses of organizers;
- Email address for official notices;
- Name and phone of a person who can be contacted about the form.
The easiest and fastest way to file your articles of organization is online. In this case, you will need to answer a few questions step by step and pay the required filing fee.
In this case, the cost to start an LLC in Minnesota is $155.
Minnesota LLC Annual Report Fee
To keep your LLC information up to date, you will need to file your annual report with the Secretary of State. As mentioned earlier, Minnesota does not charge LLCs for annual reports, provided the LLC is in good standing with the state.
Registered Agent Fee
In Minnesota, just like in any other state, you must appoint and maintain a registered agent (RA) for your LLC. Considering all other expenses, you might just find it more beneficial to be your own RA for the LLC. After all, the state does not forbid you to.
However, such a decision leads to the following disadvantages:
- Lack of privacy. If your business is home-based, your name, address, and phone number will be publicly available on Minnesota's list of registered agents;
- Strict work schedule. You must be available at the office during normal business hours. This means no sick leaves, vacations, or long breaks;
- Personal responsibility for mistakes and risk of non-compliance;
- Not enough time to focus on building and running your business;
- Tons of unsolicited mail, etc.
At the same time, a commercial registered agent will take of everything for you. Here are just a few reasons to hire a professional RA service:
- Reliable service and convenient access to documents in cloud storage, as well as timely receiving and forwarding documents in any other way you want;
- Confidentiality and free schedule. A commercial registered agent will have their own office to receive important documentation from the state on your behalf;
- Assistance with annual reports, professional legal advice, timely reminders about your important documents or business events, etc.;
The cost of registered agent services in Minessota starts from $50 per year and can be as high as $300 per year.
Our review will help you choose the best commercial registered agent for your business.
Cost to Form a Foreign LLC in Minnesota
If you already have an LLC in one state and want to expand to Minnesota, you can register in the state as a foreign LLC.
To do this, you will need to complete and file a Certificate of Authority with the Secretary of State. This can be done quickly and conveniently online on the official website. The Minnesota LLC filing fee in this case is $205.
Alternatively, you can download the form in PDF, complete it and mail it to the Secretary (or file it in person). In this case, the processing time will be longer, however, the fee is $185.
Cost to Form a Series LLC in Minnesota
Minnesota law currently recognizes Series LLCs, however, does not permit forming them in the state. Thus, if you want to open such a business entity in the state, you have two options:
- Form multiple companies in Minnesota;
- Create a Series LLC in another state for operations in Minnesota.
In the second case, the cost of an LLC in Minnesota will be equal to the cost of forming a foreign company in the state.
Cost to Form a PLLC (Professional LLC) in Minnesota
If you plan to do business as a licensed professional in Minnesota, you can open a professional Minnesota limited liability company. PLLCs are legal entities formed by one or more licensed professionals to provide services related to their professions.
This way, as an LLC owner, you will protect yourself and your company members from liability and get certain tax benefits.
Professional LLCs in Minnesota are those types of services that require a Minnesota professional license, registration, or certificate. The list of professions that can choose to form a PLLC includes:
- Medicine and surgery;
- Physician assistant;
- Chiropractic;
- Registered nursing;
- Professional counseling;
- Optometry;
- Psychology;
- Geoscience;
- Engineering;
- Certified interior design;
- Social work;
- Surveying;
- Veterinary medicine;
- Marriage and family therapy;
- Professional counseling;
- Dentistry and dental hygiene;
- Pharmacy;
- Podiatric medicine;
- Veterinary medicine;
- Architecture;
- Landscape architecture;
- Accounting and law.
According to state law, to open a Minnesota PLLC, you must:
- Have a professional state license for each professional in your LLC;
- Consult with the state licensing board to see if prior approval is needed and if so, obtain all the necessary documents;
- Submit the Articles of Organization, including the info that the business will operate under the applicable sections of the Minnesota Professional Firms Act;
- Pay the filing fee.
For PLLCs, the state filing fee is the same as for regular Minnesota LLCs ($155 for online filings and $135 by mail or in person).
Income Tax
LLCs in the state of Minnesota are referred to as "pass-through" entities by the IRS. Therefore, there's no Minnesota LLC fee associated with paying income tax for a legal entity.
You will pay income tax as an individual on the profits you pay yourself. The tax rate ranges from 5.35% to 9.85%, depending on the amount of your income. LLCs taxed as C corporations must pay a flat 9.8% corporate franchise tax.
LLCs also pay sales tax. The Minnesota sales tax rate is 6.875%. Once local taxes are added, the rate can be as high as 8.375%.
Business License Renewal Fee
If you intend to do business or sell/lease goods/services that are subject to sales tax in Minnesota, you must also obtain a seller's permit when you register an LLC. This can be done for free by visiting the Minnesota Department of Revenue or online.
In Minnesota, you do not need to renew your seller's permit. However, renewal requirements vary for other business licenses. Thus, you will need to contact the relevant government office for information on license renewal for any licenses your business may have.
You can also find a list of renewal documents for different licenses on the Minnesota Department of Labor and Industry.
Franchise Tax
Minnesota Franchise Tax is imposed on multi-franchise LLCs with estates, annual earnings, and annual sales totaling more than $970,000 (the amount is indexed annually for inflation). If your LLC's income is below this amount, no tax is due.
Also if you file as C Corporation, you will be required to pay a Corporation Franchise Tax. To make sure you're compliant, it's best to consult your accountant or tax preparer.
Other LLC Filing Costs
We've covered all the mandatory fees that may be required for different types of businesses. If you want to calculate exactly how much is an LLC in Minnesota, you should also consider non-mandatory costs that may also be relevant.
LLC Name Reservation
You may need to reserve your chosen business name with the Secretary of State. In Minnesota, you can reserve a name for your LLC for up to 12 months. To do this, complete and file the Name Reservation | Request for Reservation of Name form.
The service will cost you $55 (expedited service in-person and online filing) and $35 (by mail).
Doing Business As (DBA) Name
Your LLC's official name might be inconvenient for marketing purposes. Or you may decide to expand your product line and let your customers know about it by changing your business name.
In this case, you can file a DBA name ("assumed name" or "fictitious name") at any time in Minnesota. This way, you'll be able to use a new shorter, or more convenient alternative name on your website, and advertising. Plus, you will not need to re-register the LLC.
In the state of Minnesota, DBA filing fees are as follows:
- $50 (in-person and online filing fee);
- $30 (mail filing fee).
Certified Document Copies
In some cases, certified copies of business documents will be required by your bank or potential investors. You can order them at any time from the Minnesota Secretary of State. In this case, the fee is $15 if requested online and $5 if ordered by mail or in person.
Certificate of Good Standing
Banks require a Certificate of Good Standing ("Certificate of Existence & Registration") when applying for a business loan and sometimes when opening a new business account. You can obtain the document by ordering it on the Secretary of State's website.
A Minnesota CGS costs $5 if requested by mail or $15 if requested online.
Remember that requesting documents online will get you the documents faster.