An Overview Of Paying Minnesota LLC Taxes

Are you in the state of Minnesota? If you already have an existing Minnesota limited liability company, you are likely aware of how much you must pay in taxes. However, if you don’t have an LLC, you may be wondering if there are any tax benefits associated with setting up this business entity. As with all of the other states, there are specific documents that must be submitted, along with fees that are necessary to complete the process. It can be overwhelming for some people, which is why there are many businesses that can help with setting up LLCs that can answer questions about Minnesota LLC taxes.


Overview Of Minnesota LLC Taxes

In the state of Minnesota, LLCs are referred to as pass-through tax entities. This simply means that the business owner, and the members of the LLC, are going to pay the taxes and not the limited liability company itself. Only the members are responsible, and although there is a separate fee for LLCs, it only applies to companies that have generated more than $500,000 in sales and receipts. If you employ people, then you will also be responsible for paying state taxes as well. This includes all of the sales tax that you will have to collect if you are selling goods within that state.


Minnesota LLC Taxes


How Does This Apply To Forming An LLC?

When you form an LLC, is typically done for the purpose of protection. It guards your personal assets against individuals or companies that may sue you because of the services or products that you are selling. In regard to taxes, the LLC itself is not considered in this process, as it is simply passed through to the members that are involved. That being said, setting up a limited liability company has many benefits. It is also very easy to create. It involves filing paperwork that will include your Articles Of Organization, plus you must also prepare an Operating Agreement as well.


How To Complete Your Articles Of Organization

All of this paperwork must be submitted to the Minnesota Secretary of State. It will include the following. The name of the LLC, the registered agent associated with the LLC, along with their name, address, and signature. The organizer of the LLC must also be listed, along with their email address, physical address, phone number, and signature. These can be filed online or sent by mail, and each one comes at a different price point. It is $135 if you are going to file by mail, but if you decide to bring it in person, or do this online, is $155. This is the document that is used in order to create your LLC, but you also can prepare the Operating Agreement.


Do You Need An Operating Agreement In Minnesota?

It is essential that you fill out an Operating Agreement for personal use, but it is not essential when you are simply trying to create your LLC. It’s advisable to do so as it will portray the operations of your limited liability company. For example, it’s going to show the responsibilities and rights of the managers and members that are involved. The way that the LLC is managed, and the rules that govern that LLC, need to be listed. This will assert that this is a separate entity, in and of itself, separate from the business for which it is created. In legal situations that will require this type of information, it is a valuable document that you can simply hand to the court to show them that your limited liability company is a separate entity.


Do You Need Anything Else To Form An LLC In Minnesota?

As with many other states, you will need your EIN number. If you have to get business licenses, though should be completed next. In regard to the Department of revenue, which is focused on collecting sales tax for goods that are sold, you will need to register at the DOR website. Additionally, filing annual renewals is also necessary. Once this is done, you will be able to proceed forward with your limited liability company without any penalties or problems.

It is this final part that is sometimes difficult for people to understand. They may be able to fill out most of the Articles of Organization or come close to preparing the Operating Agreement, but extra information is always helpful. It’s even better when you have access to a company that can create all of this for you. In fact, you can find businesses that will help you with determining if your LLC name is available, find and provide a registered agent, and can help you with annual renewals. All of this information can be accessed by simply contacting a reputable business that will help you complete this somewhat elaborate process.