An LLC or limited liability company’s objective is to protect business entrepreneurs from personal accountability of the business debts or, worst if your company was sued. It’s the best way to form a business legally. Most states enable individuals and residents who live outside the country or state, corporations, other LLCs, trusts, and pension plans to serve as an LLC owner or member.
LLC is a combination of flexibility for a corporation’s limited liability and a sole proprietorship or partnership’s lack of provided formalities. Any business entrepreneur who wants to limit their responsibility for lawsuits or business debt must consider building an LLC.
SHOULD I FORM AN LLC IN MONTANA?
If you’re a startup biz or already operating as a sole proprietorship, you must consider building an LLC. This limits your accountability for your business lawsuits and debts and provides more flexibility towards taxation, management, and business ownership. Forming a Montana limited liability corporation is easier if you know where to start and what you should do. This article will give you a comprehensive overview of everything you need to know and critical elements for a successful LLC formation, especially if you plan to build one in Montana.
COMPLETE GUIDE ON HOW TO FORM AN LLC IN MONTANA
- Select an LLC name
Under Montana’s state law, your LLC name should contain the following words: Limited Company, Limited Liability Company, or abbreviations like LLC, LC, L.L.C, or LLC.
The business LLC’s name must differentiate from other business names or entities registered with the Montana Secretary of State. The availability of business names can be checked on their database.
You can reserve a business name not more than 120 days after filing a business name registration online. It will cost you a $10 filing fee.
- Appoint your registered agent
Each Montana LLC has an agent for service processing in the country/state. This agent is a business entity or individual that accepts all legal papers on your LLC’s behalf in case of a lawsuit.
An appointed registered agent can be a resident, Montana business entity, or a foreign business form authorized to do any business in the state. It requires a physical location or street address around the country.
- File your Articles of Organization
The Montana LLC is first formed by filing the Articles of Organization within Montana’s Secretary of State. This includes:
- LLC type
- LLC name
- LLC registered agents details (name)
- LLC’s mailing address or principal office
- LLC term
- Purpose of LLC
- Determine whether its a tribal business
- Whether its member-managed has a manager with the credentials of any manager or member (at least one)
- List of responsible members with written content for each
- Applicant’s signature
- Prepare your Operating Agreement
While this is not part of the requirements, we advise you to have one. Operating Agreement is a central document that determines how the LLC will operate. This includes the liability and rights of managers and members.
- Get an EIN
Regardless if you don’t have human resources yet, if the LLC has several members, you’re required to get your own EIN or IRS employer identification number. For single-member LLC, you need an EIN or appoint the business to have it taxed as a corporation and not a sole proprietorship.
- File your Annual Summary/Reports
The LLC must provide or file your annual report on good terms with Montana’s Secretary of State Office. Reports are due every year (April 15) and come with a $20 fee.
HOW MUCH WILL IT COST YOU TO FORM AN LLC IN MONTANA?
Costs vary with how you want and who will be doing the process. While it’s more affordable to do it yourself, things can be complicated, including the filing and forms you’ll need to complete. Montana’s secretary of the state usually charges $70 for you to file your Articles of Organization, and you’ll need to reserve the business LLC’s name on the state office for $10.
If you hire a lawyer to do all this job, it can cost you hundreds to thousands, varying on what needs to be done and the time frame. You can check for an online formation service to help you complete all paper works and filing procedures. Most of which comes with affordable packages to meet your current budget.
The LLC business entity primarily exists to help security managers and members from liabilities that can significantly affect an individual’s finances, especially when the business goes into debt or was sued. Aside from personal asset protection, it also builds the business credibility and provides capital ventures.