How to File an LLC in North Dakota

With its business-friendly environment, stable economy, and skilled workforce North Dakota is one of the best places to start a small business. 

While you can form other business entities, such as an S Corp or a C Corp, filing an LLC is typically the best course of action for most businesses. 

Whether starting a new business from scratch or taking your successful side hustle one step further, forming a North Dakota LLC provides entrepreneurs with considerable advantages and protections.

Incorporating a North Dakota LLC can initially seem complicated, but in this article, we will break the entire process down step by step. 

Key Takeaways

• North Dakota is a business-friendly state, and incorporating an LLC offers multiple advantages

• LLC stands for a limited liability company and offers personal liability protection 

• LLCs have a flexible tax status, and their owners enjoy pass-through taxation 

What Is an LLC Formation?

LLC is an abbreviation for limited liability company. LLCs are formed under state statutes, and each state has a unique filing process. You must file for your LLC with the North Dakota Secretary of State in North Dakota. 

LLCs are flexible business structures that provide their owners — also known as members — with considerable benefits. 

Forming an LLC Protects Your Personal Assets

As an LLC owner, you’re not personally liable for your business. If your LLC has debts or someone sues you, your personal assets, such as your house or car, are safe from litigation.[1]

This liability protection works the other way around, too. If someone sues you personally or you have to pay off debts, only your personal assets are on the line, and your LLC assets are protected. 

LLC Has a Flexible Tax Status

One of the main reasons entrepreneurs form an LLC is for tax purposes. As the LLC’s owner, you can decide whether you want your business to be taxed as a sole proprietorship, a partnership, an S Corp, or a C Corp. 

As a result, in some cases, LLC owners can report their LLC earnings on their personal income tax returns and avoid double taxation. 

LLCs Are Easy to Manage

Running your LLC and keeping it compliant with the law is typically straightforward. To keep your North Dakota LLC in good standing, you must submit an annual report, filing fee, and other required state fees. 

You can run your LLC yourself, in which case it’ll be called a “member-managed LLC.” Alternatively, you can appoint managers to take charge of your business operations, in which case your LLC will be a “manager-managed LLC.” 

Should I Wait to File My LLC? 

Some entrepreneurs believe they should postpone LLC formation until their business is established and generates considerable revenue. However, the earlier you incorporate your LLC, the earlier you’ll be able to take advantage of its benefits. 

Step-By-Step Guide to Starting Your North Dakota LLC

The process of forming an LLC varies by state. In the following sections, we’ll break down the North Dakota formation process step-by-step, so you can get your LLC up and running quickly. 

Step 1: Choose a Business Name for Your North Dakota LLC

The first decision you need to make during the formation process is what your LLC name will be. 

For the most part, your North Dakota LLC name is only limited by your imagination. However, the Secretary of State requires your business name to be unique from other businesses already registered in the state. For example, if a company in North Dakota is already called “Joe’s Pizza,” you can’t start a company under the same name. 

To find out if the business name you’re considering is still available in North Dakota, you need to do a name search on the Secretary of State’s website. Once you decide on your LLC name, you can reserve it for 120 days with a $10 fee. 

Your North Dakota LLC name also must include the words “limited liability company” or “limited company” or the abbreviations “l.l.c.”, “l.c.”, “llc” or “lc.” 

However, you don’t have to use your official company name to conduct business. You can also apply for a DBA (doing business as also known as a “trade name”). 

LLC Domain Name

Even though it’s not required during the LLC formation process, you may consider buying your domain name. Even though you may not need a website right now, there’s a high chance you might launch a website later on. 

Ownership of the domain name doesn’t guarantee you can use it as your business name.[2]

Trademarking Your LLC Name

If your LLC name is unique enough, it may be eligible for a state or federal trademark. Trademarking your LLC name means on a national level means no one else can start a business using your LLC name. 

Applying for a trademark is a great way to protect your brand assets, but it’s typically better to wait to do so until your LLC is incorporated. 

Step 2: Fill Out North Dakota Articles of Organization

To officially register your LLC with the Secretary of State, you must file your Articles of Organization. Your Articles of Organization is a legal document that provides foundational information about your LLC, including: 

• LLC name

• LLC address and mailing address 

• The name of your registered agent 

• Your registered agent’s address 

• LLC duration 

• LLC purpose

• Whether your LLC will be member-managed or manager-managed

• Signatures of the organizers

North Dakota Articles of Organization is a crucial document, so ensure you have enough time to file it correctly. 

Together with your Articles of Organization, you must file a $135 filing fee for your North Dakota limited liability company. If you’re incorporating a foreign LLC, the filing fee is still $135. 

Once the Secretary of State incorporates your LLC, you must keep it in good standing with the state law. This means submitting an annual report and covering all the necessary state taxes and state fees. 

Step 3: Hire a North Dakota Registered Agent

The law requires every LLC to have a designated registered agent. Your registered agent’s responsibility is to receive important legal documents for your business, such as the service of process. 

You can be your own registered agent as long as you fulfill the following requirements: 

• You are over 18 years of age

• You have a street address in North Dakota (not a P.O. box) 

• You can be present at your registered address during business hours 

The last requirement typically poses a challenge to entrepreneurs and small business owners. 

If you are your own registered agent, then you must be present at your office Monday through Friday, 9 am to 5 pm. This means you won’t be able to leave for a lunch meeting or take a vacation without potentially causing severe consequences for your business. 

As a result, many business owners decide to hire a registered agent service like Swyft Filings. Instead of having to bear the responsibility of being their own North Dakota registered agent, they get a secure and reliable professional service to ensure compliance. 

Step 4: Create an LLC Operating Agreement

An LLC operating agreement outlines your business’s operations and serves multiple purposes. It proves that you own your LLC, can help resolve disputes, and can override North Dakota state laws in certain situations. 

You aren’t required to have a written operating agreement in place. However, creating one for your business entity is highly encouraged. If you don’t have an operating agreement, default North Dakota laws will govern your business in case of a dispute or other litigation, which may not always fit the unique circumstances of your business. 

LLC owners can create an operating agreement regardless of whether they have a single or multi-member LLC. 

Step 5: File for an Employer Identification Number and Business Licenses

The final step to setting up your North Dakota business is ensuring your taxes and business licenses are in order. 

Your employer identification number — EIN — is a nine-digit tax identification number that identifies your LLC for tax purposes. It’s issued by the internal revenue service, and you can consider it a social security number for your business. 

You’ll need an EIN to open a business bank account, establish payroll, and file tax returns for federal and income tax. To get your EIN, you can request one on the IRS website. If you apply online, you can get your EIN immediately.[3]

Even though North Dakota doesn’t require a general business license, your local authorities — such as your country or municipality — may require you to apply for a license or a permit to operate your business in compliance with the law. 

Let Us Handle Your LLC Paperwork

LLC formation in North Dakota comes with multiple steps and various paperwork. Some entrepreneurs hire lawyers to incorporate their North Dakota LLC, but lawyers charge steep fees. 

Swyft Filings helps you file for your LLC in just a few minutes and enables you to avoid paying a lot to a lawyer to get your small business up and running. Simply answer a few questions about your business on our secure online portal and get your paperwork appropriately filled out and filed with the Secretary of State today. 

FAQs:

How much does it cost to set up an LLC in North Dakota?

The filing fee to incorporate your North Dakota LLC is $135. However, you may need to cover additional costs to reserve your LLC name, buy your domain name, or expedite the filing process. 

How is an LLC taxed in North Dakota?

As an LLC owner, you can decide whether your North Dakota LLC will be taxed as a sole proprietorship (for single-member LLCs), a partnership (for multi-member LLCs), an S Corp, or a C Corp. 

What are the benefits of a North Dakota LLC?

North Dakota offers a business-friendly climate and many opportunities for entrepreneurs and small business owners. Once you incorporate your LLC, you’ll enjoy benefits like personal liability protection and a flexible tax structure.  

How do you dissolve an LLC in North Dakota?

To dissolve your North Dakota LLC, you must either file the Articles of Dissolution by Organizers or the Articles of Dissolution by Members, depending on whether your LLC has unpaid debt or has ever accepted any contributions. 

Bibliography:

1. U.S. Small Business Administration. Choose a Business Structure. Accessed April 24, 2023. 

2. North Dakota Secretary of State. Frequently Asked Questions. Accessed April 24, 2023. 

3. Internal Revenue Service. How Long Will It Take to Get an EIN? Accessed April 24, 2023.