Just like with any other US state, forming an LLC in North Dakota is a technical process that involves a few steps that need to be followed in the right order.
You can go for professional advice, however, you can also do it yourself provided that you have all the information you need.
Keep reading and you will know what a North Dakota LLC formation entails.
How to Form an LLC in North Dakota
In this guide, we will be walking you through the 6 basic steps to form an LLC in the state of North Dakota, split into two sections.
Steps to Form a North Dakota LLC
- Name your LLC
- Appoint a Registered Agent
- Submit Articles of Organization
Steps to Take After Your North Dakota LLC is Approved
- Operating Agreement
- EIN, Bank Account, Tax Requirements & Phone Number
- File Annual Reports
Let us now have a detailed look at each of these steps.
Naming Your North Dakota LLC
The process begins by choosing an available and a legally correct name for your North Dakota LLC. The name should be unique and distinguishable from other entity names registered with the state.
You can check the availability of your desired LLC name at the business name search database of North Dakota. You can reserve a name for up to 12 months by filling out the SFN 13015 Reserve Name Application. This application can be filled online or by mail with a filing fee of $10.
North Dakota LLC Name Rules
According to North Dakota LLC name guidelines, your business should meet the following criteria:
- Name should include ‘Limited Liability Company’ or its abbreviation ‘LLC’ or ‘L.L.C.’
- Name should not give an impression of another company type, for example Corp., Inc., Trust, etc.
- Should not have words that represent a government institution, for example FBI, CIA, State Department, etc.
Appoint a Registered Agent
The next step after choosing the right name for your LLC is to designate a North Dakota registered agent.
What is a Registered Agent and Why Do You Need One?
A registered agent is an individual or an institution that receives legal documents (service of process) on your LLC’s behalf, and acts as a point of contact between your LLC and the state.
According to North Dakota state statute 10-32.1-16, every LLC needs to appoint a registered agent. You can either hire a commercial or a non-commercial registered agent, or can select someone from your LLC (including yourself) to be your LLC’s registered agent.
The registered agent should be a resident of the state with a valid physical street address in the state of North Dakota. You can have a look at the list of registered agents in North Dakota here.
Submit Articles of Organization
The final step in the formation of a North Dakota LLC is to submit the Articles of Organization with the North Dakota Secretary of State.
You will be submitting the following information in this step:
- Name of LLC
- Type of LLC (Regular or Farming/Ranching)
- Address of LLC’s Principal Office (mention the physical street address of your LLC and not a P.O. Box)
- Name and Address of Registered Agent
- Date of Formation (you can list a date for up to 60 days in future)
- Business Purpose (business purpose can be any lawful reason for which the company has been created)
- Name, Address & Signature of Organizers (organizer is any individual who submits the articles, doesn’t necessarily has to be part of the company)
The Articles of Organization can be submitted online with a filing fee of $135. However, the online portal can only be used if your articles only include information that is required by the law. If there are any additional provisions, you will have to file your articles via mail at the following address:
Business Registration Unit
Secretary of State
State of North Dakota
600 E Boulevard Ave Dept 108
Bismarck, ND 58505-0500
Or via fax at this number: 701-328-2992
Moreover, you will need to fill out the Credit Card Payment Authorization details. If you use a check, it must be made payable to ‘Secretary of State’.
Once your Articles of Organization get the nod from the Secretary of State, here is a look at the steps that you should take:
This is not a mandatory step for LLCs formed in the state of North Dakota, however, it is advised that you do prepare an operating agreement for your own benefit.
What is an Operating Agreement And Why Do You Need One?
An operating agreement is an internal document that lists the LLC ownership, operating structure of the company, duties and liabilities of its members, etc. The major benefit of having this document is to ensure business transparency and cohesion among all the LLC members at any given time.
Disputes or conflicts can be avoided if an operating agreement has been prepared.
EIN, Bank Account, Tax Requirements & Phone Number
Once your North Dakota LLC is approved, you can go ahead and get the EIN (Employee Identification Number) for your company. EIN is a nine-digit number that is assigned by the IRS (Internal Revenue Service) for tax collection in future.
Also, you will need an EIN for opening your LLC’s bank account or when you decide to hire employees.
It is advised that you open a separate LLC bank account. This is to keep your personal assets safe and treat your LLC as a limited liability entity, keeping your personal and business finances separate.
Tax Compliance & Other Requirements
Depending on the nature of your company, you will be required to register your LLC for one or more types of tax. This includes:
- Sales Tax – usually for physical products along with a certificate that allows you to collect tax
- Employer Tax – if your LLC has employees, you will need to register with the Unemployment Insurance Tax
- Federal – Most LLCs are required to submit information about their income with the IRS using either Form 1065 (multi-member) or Form 1040 (single-member)
Moreover, you might need local or state business licenses and permits, again depending on the type of your business and it’s location.
File Annual Reports
As per the laws in North Dakota, you will need to file an annual report with the Secretary of State. This can be done online with a non-refundable filing fee of $50.
The due date for this report is November 15th each year. The first report will be due in the year that follows the one in which the LLC was formed.
Penalty And Dissolution
If you miss the date, a late fee of $50 will be charged on top of the $50 filing fee as a penalty. If the annual report is not filed for 6 months, the North Dakota Secretary of State has the right to revoke the LLC’s registration.