If you wish to forego the restrictions imposed by incorporation and enjoy pass-through taxation like a partnership, you’ll want to find out more about setting up an LLC in Montana. This hybrid entity allows you to enjoy freedom from personal liability while giving you the ability to only pay taxes on your personal income tax return.
Each state has specific legal requirements for establishing a limited liability company or LLC, and Montana is not an exception.
However, all states do require you to choose a unique name, retain a resident agent to receive LLC info, and submit Articles of Organization. Legal representatives also recommend that you create an operating agreement to ensure any future internal disputes are resolved amicably.
State-Specific Requirements for LLC Registrants
In Montana, you’ll need to keep the following state-specific requirements in mind:
- Your LLC must have one or more members/managers.
- You do not have to reside in the state if you’re a member-manager of an LLC. In other words, the state does not make a provision for residency.
- You do not have to meet certain age requirements.
- You must list the names and addresses of LLC members on the Articles of Organization.
Choosing a Unique Business Name
To get the process started, you’ll need to establish a unique name for your LLC. Therefore, you’ll have to check the Secretary of State database to make sure the name you like has not been taken. Make sure you have a backup name if you’re unable to use the chosen name.
Retaining a Registered Agent
Next, you’ll need to retain the services of a registered agent who can accept legal and tax documents on behalf of your LLC. The resident agent–whether a company or a person–should be available during regular business hours.
What You Need to Submit When Filing Your LLC
When filing your LLC documents to the Montana Secretary of State, you’ll need to submit the following information:
- Your LLC’s official name
- The type of LLC you’re choosing to form (member-managed or manager-managed)
- The Articles of Organization (you’ll create this document after you receive an official name and retain a registered agent)
- The name/address of the registered agent
- Your LLC’s business mailing address
- Contact details and names of members and managers
You should create an operating agreement that you keep filled internally. You don’t have to file the operating agreement with the Secretary of State. You just need to make sure everyone understands their rights in case of any internal differences.
Businesses that Provide Professional Services
Montana allows professionals, such as attorneys, doctors, and accountants, to set up professional limited liability companies, or PLLCs. If you’re a professional person, you may also choose to incorporate. It just depends on your personal business goals.
While incorporation has more restrictions, you can sell shares of stock or raise capital when electing to set up your business as a professional corporation (PC). If you’re just starting out or have a smaller practice, you may prefer to establish a PLLC.
Taxes and Fees for LLCs in Montana
After you submit your paperwork for an LLC and you will become an official company, In turn, you will be assessed certain fees and must follow a specific protocol to stay active. For example, you’ll need to keep the following in mind:
- You’ll need to submit and file an annual report for your company between the dates of January 1 and April 15. The filing fee for doing so is $15.00.
- Talk to a tax accountant about paying taxes. An LLC offers pass-through taxation, so you’re not taxed on your business. Instead, the amount you pay for tax passes through to your individual tax return. Therefore, you can avoid paying an additional tax, as you do with a corporation.
- You’ll need to obtain a federal tax identification number, also called an employer identification number (EIN) from the IRS. This number is like a Social Security number except that it is used for business taxes and transactions. An EIN is often necessary when you open a business bank account. You also need an EIN to pay employees.
- You don’t need to get a state tax I.D. to do business as an LLC in Montana.
Business Licensing and Permits
You may need licenses and permits, depending on your business. Learn more about these requirements by checking on the licensing and permit requirements in your local jurisdiction.
Keep Your LLC Operational
Once you set up your LLC in Montana, it’s important to follow through and submit your annual report, as required by law, and pay the appropriate fees and taxes. You don’t want the state to dissolve your company because of non-compliance.
Your LLC is designed to protect your personal assets and enhance your professional standing. So, make sure you follow the state’s rules for keeping it in force.
Call the Corporation Center to Set Up Your Montana LLC Now
If you want the process of setting up your LLC to go fast and hassle-free, contact a company, such as The Corporation Center. You can find out more about the steps you need to take by calling the Corporation Center at (800) 580-4870 today.