Form a North Dakota LLC

Professional Advice for Forming an LLC in North Dakota

The legal procedures involved in setting up a new business can certainly be intimidating. The first step is to establish a structure for your business. What this page aims to do is to guide you through the the steps involved in setting up an LLC, one common type of structure for business, in North Dakota. Your North Dakota LLC search has brought you to the right place!

The purpose of an LLC, or “limited liability corporation,” is to protect your business or assets against legal actions. Forming an LLC in North Dakota shouldn’t be too hard if you go through the proper steps and pay attention to important details.

Naming Your Enterprise
Selecting a name for your North Dakota LLC is the first thing you should do, paying careful attention to the naming rules determined by the state.

Naming Your Enterprise

Selecting a name for your North Dakota LLC is the first thing you should do, paying careful attention to the naming rules determined by the state.

  • Your LLC’s name must contain the words “LLC” or “limited liability corporation.”
  • The inclusion of specific words, such as “Doctor” or “Attorney,” may require special conditions such as the presence of a licensed individual.
  • The business’ name cannot be the same as a government agency, such as the State Department.

Now, search for your name in the state database to see if it has already been taken.

Registered Agent

The next step in the process is to choose a Registered Agent for your LLC North Dakota. A Registered Agent is someone you have authorized to receive legal documents for your enterprise. The RA can be anyone who is legally able do business in the Peace Garden State. You can serve as your own Registered Agent, or you might want to think about employing a Registered Agent service.

Articles of Organization

The next step in setting up an LLC in North Dakota is to file for your Articles of Organization. It can be done by mail using this form. If you’re expanding an existing LLC from another state to North Dakota, you will need to file as a foreign LLC. The fee is $135 and filing time is usually 5-7 days. If you have more questions contact a LLC Formations specialist.

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Operating Agreement

An operating agreement establishes the basic structure of an LLC. It puts in writing who the owners are and how it is to be run. In North Dakota, it is not a legal requirement to have one, and an operating agreement doesn’t have to be filed with the state like the Articles of Organization, but it is a good idea to do so!

Obtaining an EIN

An EIN is a number the government uses to identify your limited liability company. You will need it for tax purposes, and also to open a bank account and hire employees.

You can do this online, or you can fill out a form.

You don’t need to enter your SSN to get an EIN if you don’t wish to. While most people use the default tax option when getting an EIN, some choose S corporation status. You can ask an accountant which option is better for your business.

Further Protecting Assets

The entire reason one forms an LLC, of course, is to protect business assets against legal claims. To ensure this level of protection, however, there are two additional things you must do: open a business bank account and get a business credit card.

Both of these things help keep your personal assets separate from your business assets. They also improve accounting and tax filing. The credit card will help build your business’ credit, too. You may wish to shop around for the best business credit card.

You’ll want to be very careful how you sign your business’ legal documents, as well. Make sure you’re signing on behalf of your business and not as you yourself!

Here is a simple formula to use when signing for your North Dakota LLC:

  • Formal business name
  • Your signature
  • Your printed name
  • Your business title

Lastly, you must look into buying insurance to protect your business assets. Most small business owners purchase general liability insurance. You may need to consider professional insurance and worker’s comp insurance, which are sometimes legally mandatory. You might also consider property insurance, product liability insurance, and more.

Compliance

You’re about ready to start your North Dakota business. There are still a few important items to look over. Local, state, and federal regulations might require that you get a a license and permits for your enterprise. For instance, you may need permits for health, building, and signage. Short classes may be necessary as well. You can use the State of North Dakota’s business licensing information if you wish to learn more.

Obtaining the licenses your small business needs can become complex and time-consuming. You may wish to hire a professional to help you.

Taxes

Taxation is an ugly word to many Americans, and a challenging reality for a Mississippi LLC. Your business is liable for a number of state, local, and federal taxes. Remember, your LLC faces automatic dissolution if you miss any major tax filings, which means you would lose your legal asset protections!

The first and most outstanding obligation is state and local sales tax. You’ll need to register for a seller’s permit with the State of North Dakota. It is also necessary to register for unemployment insurance tax and witholding tax. And remember to file your annual report with the North Dakota Department of State. If your LLC is multi-member, you’ll want to file for Federal taxes here, whereas most single-member LLCs file here.

Taxation is the law of the land, so abiding by it is probably a better alternative than automatic dissolution.

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Accounting and Bookkeeping

Having your business’ books up and ready to go is vital even before opening day. Well-kept books streamline your business’ finances, allow you to keep track of assets and expenditures, and make life less stressful come tax day. You’ll want to use a popular software like QuickBooks, or an open-source accounting software, to keep track of your expenses. Reliable bookkeeping software will automatically sync to your business’ bank account, keep track of your assets and expenses, and can be accessed from a cell phone.

You should also strongly consider double-entry bookkeeping. This is usually standard on bookkeeping software, but it should be noted just in case. Single-entry, in which one record is made per transaction, is doable for very small enterprises. However, for a larger or growing business, double-entry — in which every transaction is registered as a credit and a debit — is invaluable. Without it, it would be impossible to keep track of payments and income, and would make audits a nightmare.

Certificate of Good Standing

A Certificate of Good Standing certifies that your business was formed legally and is being run well. Having one enables you to more easily borrow money, expand into other states, or obtain licenses and permits. You can get one here.

Dissolving an LLC

If at any time you wish to dissolve your LLC, you should do so officially by closing your business tax accounts and filing your Articles of Dissolution. If you don’t do this properly, you could face tax liabilities, penalties, or even legal trouble.

Getting Started as an Entrepreneur

So now you’re ready to begin! Pretty easy, right? Entrepreneurship is really very demanding. It requires pluck, determination, endless multitasking, and a willingness to jump through some fairly daunting hoops. It helps to have experts in your court who can smooth the process along.

One of the most frequently overlooked aspects of running a business is the business plan. Yet planning is key to business, and research is key to your plan. Make sure you understand your target market forward and backward. Make sure you understand all your costs before you begin, how big the market is, and how quickly your business is likely to start grabbing it.

Of course, by now you’ll know what product or service you intent to provide. You should also have developed a solid idea of how your company is to be organized and what procedures it will follow on a daily basis. You should also have a solid marketing plan in place, identifying who will be likely to seek your services and how you will reach them. You’ll need a plan ready when you’re seeking a loan, either from a private lender or from an organization like the SBA.

Most importantly, you’ll need to have a support network you can rely on. Your friends and family won’t just be there to lean on emotionally during the often aggravating process of starting a business, they may be a source of capital and an initial market for your services. Seek their company and their advice. Listen to their feedback. Because at the end of the day, business really is about people! Our next blog focuses on Ohio LLCs.