How to Form an LLC in North Dakota: A Simple Step by Step Guide

When you decide to start a new LLC in North Dakota there will be a list of requirements you need to follow to ensure you are forming your business in good standing. Starting a new LLC offers many useful advantages to business owners including ease of formation, flexibility in ownership, and the liability protection that is granted to business owners. However, to get the most out of these benefits you will need to start and keep your LLC in good standing to be considered an active business. This typically will be a checklist of requirements to follow while in the process of forming your business, along with the ongoing compliance guidelines that are set by each state. For a North Dakota LLC, this checklist will include:

1. Choosing a business name - Your business name is required to be unique and distinguishable from other active businesses in the state, and also include a designator such as "LLC" or "Limited Liability Company".

2. Appoint a registered agent - All LLCs that are registered in North Dakota are required to have an active registered agent that has a current physical address in the state. This person will be responsible for receiving any service of process or important notices that are sent to your business.

3. Submit your Articles of Organization - This will be the document that officially forms your LLC with the North Dakota Secretary of State. It will include your business information, registered agent information, and ownership information.

4. Draft an operating agreement - The operating agreement will be what outlines the roles and responsibilities of the business owners, and details the financial structure and operations of the LLC.

5. Obtain an EIN - Your EIN will be issued to your business by the IRS and will act as a social security number for your business. You will use this for filing taxes, hiring employees, and opening a business bank account.

6. Open a business bank account - A business. bank account will be what outlines a clear separation of your personal and business finances

7. Maintain ongoing compliance - After you have formed your LLC you will need to file annual reports and register for business licenses to stay in good standing with the North Dakota Secretary of State.

This guide will cover the guidelines and provide tips on how to form an LLC in North Dakota. This can be done either by yourself or you can hire a service like Firstep to complete this process for you while you focus on building your business. Regardless of what option you choose, the information in this guide will give you the advice needed to set your LLC up to be in good standing and continue to stay registered as an active business in the state of North Dakota.

Step 1: Choosing a Business Name

The first step of forming a new LLC will be to choose a business name. This name will be important as this typically will be the first thing potential customers see when interacting with your business. It is useful to have a name that relates to the products or services you are offering to increase the chance of these customers remembering what you do, and make them more likely to become repeat customers. Be aware to not use any misleading wording in your name to sound like you are a government or specialized business if this does not relate to your services, such as using "bank" or "insurance" if you are not a part of these industries.

Your LLC's name will be required to be unique and distinguishable from the other active businesses that are registered in North Dakota, so it helps to have the North Dakota business search tool open while brainstorming to avoid any conflicting names and know what is available to use. The North Dakota Secretary of State does not hold business names for any reason, so if there is not an active business currently using your desired name then it is available to use. This includes if their business was administratively dissolved or if they voluntarily dissolved the business on their own.

Step 2: Appoint a Registered Agent

All LLCs that are registered in North Dakota will be required to have an active registered agent for their business. A registered agent is responsible for receiving any service of process and important documents that are sent to your business by the Secretary of State, which will include any legal action taken against your business or changes to compliance requirements by the state. To qualify to act as a registered agent you will need to meet certain requirements such as:

• Be at least 18 years old

• Have an active physical address in the state of North Dakota (PO Boxes don't count)

• Be available during regular business hours at your listed address (Monday-Friday 9am-5pm)

As long as your registered agent is able to meet these listed requirements you are able to appoint anyone you choose for this role. You are able to act as your own registered agent, choose a trusted friend or family member, or you can hire a registered agent service like Firstep to handle this process for you. Keep in mind that your Articles of Organization will be public record, so whoever's address you list as your registered agent's will be viewable by anyone who searches your business. If you are someone who values privacy then hiring a registered agent service like Firstep can be beneficial as this will allow you to avoid listing your personal address on your formation documents.

Step 3: Submit Your Articles of Organization

Now that you have chosen a business name and have a registered agent in place you are ready to submit the Articles of Organization. You will be able to find this form by going to the North Dakota business website and need to provide a certain set of information about your business. For an LLC in North Dakota, this information will include:

• Provide the exact business name how you would like it to appear on your Articles of Organization

• Enter the principal office address and the mailing address of the business

• Select if you are going to have a commercial or noncommercial registered agent

• This information will need to include the full name, address, and mailing address of the registered agent

• Choose whether or not your LLC will have an expiration date

• If applicable, provide a short description of your business purpose.

• Choose a designator for the end of the business name

• Enter the full name and address information of the business owners

• Authorize the document by providing a signature of an organize

• After this, you will be taken to a page to review the information you submitted and submit your filing fee to officially form your business

The total fee to submit an Articles of Organization in North Dakota will be $135. After you have submitted this document, the processing time will typically take around 5-7 business days to be reviewed by the North Dakota Secretary of State. Once your Articles of Organization is approved, you will receive an email confirmation your LLC has been approved to the email address on file. To obtain your certified documents you will need to go back to the North Dakota business website and navigate to the "my forms" tab on the left side of the home page. This will show you recently filed documents and provide a download link for them. You can choose to either form your business on your own or you can hire a service like Firstep to complete the formation process on your behalf.

Step 4: Draft an Operating Agreement

Now that you have your North Dakota LLC officially formed, it's highly suggested for your next step to be to draft an operating agreement. The operating agreement will be what outlines the roles and responsibilities of the owners of the business, as well as establishing the financial and operational procedures the business will adhere to. This document will also detail the voting rights, how members join and leave the business, and will help to strengthen your liability protection.

Although operating agreements are not legally required for LLCs in North Dakota, it is still very useful to have one created for your LLC due to the benefits and structure they provide to your business. This document will set standardized procedures for your business which will help to avoid internal disputes by creating clear steps for solving these disagreements and what your members are allowed to do.

Your operating agreement will not be filed with any state or local government, as this will be mainly used for internal purposes. However, you will most likely need to provide this when opening a business bank account.

Step 5: Obtain an EIN

With your LLC formed and operating agreement drafted, the next thing you will want to do is obtain an EIN. Your EIN, or employer identification number, will be issued to your business by the IRS and will act as a social security number for your LLC. This number will be used when filing taxes, hiring employees, and opening a business bank account. Each business will only be issued an EIN one time and these will not need to be renewed, so it's important to save the documentation you receive in a safe place to avoid having to retrieve this later on. You can choose to either obtain your EIN on your own or you can hire a service like Firstep to complete this process for you while you focus on managing your LLC.

If you have gotten an EIN before and either lost or forgotten your number, you can still retrieve your EIN from the IRS. This will require you to submit a set of forms to the IRS to prove you are an authorized member of the business and enter your business information to ensure you are receiving the correct EIN. There are no processing times that are listed by the IRS, so this process can be lengthy. Be sure to begin this process before any important dates such as when you need to hire employees or file your taxes. Whether you are retrieving an old EIN or obtaining a new number, you are able to choose to either do this on your own or you can hire a service like Firstep to obtain this for you.

Step 6: Open a Business Bank Account

Once your LLC has been officially formed in North Dakota and the corresponding documents obtained for it, you will want to open a business bank account as soon as possible. A dedicated business bank will ensure the clear separation of personal and business finances, which will strengthen the liability protection granted to LLC owners that acts as a shield for their assets. This shield, commonly referred to as the corporate veil, is what is able to protect your personal assets in the case of any lawsuits or significant debts that are incurred by your business. If this were to happen, debt collectors and courts are only able to go after your business's assets and are unable to touch your personal assets due to the protections of the corporate veil.

The protections granted by the corporate veil are only active if your business is meeting certain requirements, which include having a clear separation between your personal and business finances, maintaining good standing with the Secretary of State, and overall treating your business as a completely separate entity than yourself. You also need to ensure your business is not engaging in any illegal activities as this will quickly lead to the loss of the liability protections.

If you are using your personal bank account to manage your business finances as well, it can get very difficult to keep track of which transactions are which. Using a business bank account allows you to be aware of your business funds, how much cash is available to you, and to know which transactions are for which purposes. Along with the corporate veil, the simple tracking of your business funds is another advantage of having a business bank account.

Opening a business bank account is able to give your business added credibility when working with outside vendors or partners. You also are able to send and receive payments under your actual business name rather than your personal name which gives a more professional feel to partners looking to work with you.

Step 7: Maintain Ongoing Good Standing

With your North Dakota LLC officially formed and all other steps completed it will be extremely important to maintain your good standing with the Secretary of State. This will include filing your annual reports on time and also registering for any business licenses that may be required by the industry you are operating in.

Annual Reports

All LLCs that are registered in North Dakota will be required to file annual reports each year to renew their business registration. These reports will be due by November 15th each year and will cost a total of $50. You will need to go to the North Dakota business services website to file your annual report and will need to either update any business information that has changed or confirm there are no changes to your information. Keeping your business information up to date and accurate ensures the state is able to reach you for any reason.

Business Licenses

Depending on the industry your business is operating in you may be required to register for certain business licenses. North Dakota does not issue a statewide business license, but for specialized industries you will be required to register for city or county licenses for your business such as construction, insurance, law, or healthcare. These business licenses may also need to be renewed to stay in compliance with your industry and with the Secretary of State of North Dakota.

FAQs on North Dakota LLCs

When are annual reports due for North Dakota LLCs

Your annual reports will be due each year on November 15, and will cost a total of $50.

Do I legally need an operating agreement for my LLC in North Dakota

No, operating agreements are not legally required for North Dakota LLCs to be considered in active standing. However, these are highly suggested for new LLCs as they are very helpful and provide many advantages to LLC owners.

Can I form an LLC in North Dakota if I don't live in the state

Yes you can still form an LLC in North Dakota even if you don't live in the state. You will still be required to have an active registered agent that has a current physical address in North Dakota and meets all registered agent requirements.

Where do I go to submit my Articles of Organization and file annual reports for my LLC in North Dakota

To submit both your Articles of Organization and file annual reports you will need to go to the North Dakota business website.