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Last Updated on May 15, 2024 by Dr. Gabriel O’Neill, Esq.
Starting a business venture is an exhilarating and rewarding journey, yet the task of officially registering your company might seem daunting, particularly for those venturing into entrepreneurship for the first time. Nevertheless, armed with the appropriate guidance and resources, the process of registering your business in Minnesota can be made seamless and uncomplicated.
Within this blog post, we offer a comprehensive guide to aid you in navigating the registration process for your Minnesota-based business effortlessly. Furthermore, we’ll provide valuable insights and resources to streamline this procedure for you. Whether you’re launching a new enterprise or formalizing an existing one, this guide simplifies the process into seven straightforward steps.
Recognizing the potential challenges of business registration, we’ve curated a selection of some of the most efficient business registration services, such as Northwest Registered Agent, to facilitate the process for you. Let’s delve into this guide and assist you in officially establishing your business presence in Minnesota!
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How to Register Your Business in Minnesota in 7 Simple Steps
Registering your enterprise in Minnesota is simple and uncomplicated when you’re aware of the required steps. Adhere to these 7 steps to promptly launch your Minnesota-based business without any hindrances.
Step 1: Choose Your Business Structure
Choosing the most suitable business structure for your venture in Minnesota is contingent upon the type of business you intend to start and your expansion aspirations. We have already discussed the different types of incorporated and unincorporated businesses available in Minnesota. Now, let’s delve into each of these options and their operational mechanisms.
Please keep in mind that if you opt for a structure that necessitates incorporation, you will need to register your business with the Minnesota Secretary of State.
Sole Proprietorship
A sole proprietorship is the simplest business structure in Minnesota, where the owner and the business are considered one legal entity. Consequently, the owner assumes personal responsibility for the business’s debts and liabilities. Establishing a sole proprietorship is uncomplicated and involves minimal legal and administrative requirements. In Minnesota, there is no requirement to register a sole proprietorship with the state, although local permits or licenses may be necessary.
General Partnership
A general partnership is a business jointly owned by two or more individuals who share in the profits and losses. Each partner bears personal liability for the business’s debts and legal obligations. In Minnesota, there is no requirement to register a general partnership with the state, but it may be necessary to file a “Minnesota Assumed Name Certificate” (DBA) in the county where the business operates.
Limited Partnership (LP)
In Minnesota, a limited partnership consists of one or more general partners who manage the business and have unlimited personal liability, as well as one or more limited partners who provide capital but have limited liability. To establish an LP in Minnesota, you must file a “Certificate of Limited Partnership” with the Minnesota Secretary of State.
Limited Liability Company (LLC)
An LLC is a flexible business structure that combines the liability protection of a corporation with the tax benefits and simplicity of a partnership. In Minnesota, you must file an “Articles of Organization Limited Liability Company” with the Minnesota Secretary of State and create an Operating Agreement that outlines the company’s management and ownership structure.
Corporation
A corporation is a legal entity separate from its owners (shareholders), offering limited liability protection. Minnesota recognizes two types of corporations:
- C-corporations
- S-corporations
To establish a corporation in Minnesota, you must file either a “Articles of Incorporation For-Profit Corporation” or a “Articles of Incorporation Nonprofit Corporation” with the Minnesota Secretary of State, depending on your business type. Corporations involve additional formalities, such as creating bylaws, issuing stock, and conducting regular board and shareholder meetings.
Select the business structure in Minnesota that best aligns with your needs in terms of liability protection, taxation, and management requirements. If you require assistance in making this decision, it’s advisable to consult with a legal or business professional.
Step 2: Select a Unique Business Name
In Minnesota, there are several options for naming your business. You can choose a name by registering a legal entity name, obtaining a trademark, or registering a legal name while operating under a different one. It’s important to note that naming rules and regulations vary from state to state, so it’s necessary to review the specific requirements for Minnesota.
Similar to the process of incorporating your business, the naming approach you select in Minnesota will depend on the unique needs and circumstances of your entity.
While you have the option to pursue all three routes to ensure the exclusivity of your business name, you can also opt to utilize a single option. Although it’s not mandatory, it’s recommended to use the same name for each registration method.
Now, let’s delve into the specifics of each naming option in Minnesota:
Legal Entity Name
In Minnesota, businesses must register a legal entity name, which serves as the official identification of the company by the state. Entity names need to be distinct, ensuring that your business is protected from the possibility of another entity having the same name.
Minnesota’s naming laws encompass guidelines regarding company suffixes (e.g., LLC, LP, or Corp) and require the name to accurately reflect the type of business being registered. You can check for name availability by utilizing the Minnesota Secretary of State’s database.
Trademark
In Minnesota, a trademark acts as a form of intellectual property protection for a business name or logo on a national level. To safeguard your name or logo, it’s crucial to conduct a comprehensive search in the USPTO database to ensure it’s not already registered.
Upon registration, a trademark grants exclusivity and prohibits others from using the same or similar name or logo for similar goods or services, providing nationwide protection. However, it’s important to note that obtaining a trademark does not automatically grant the right to use the name or logo in all circumstances.
Doing Business As (DBA)
In Minnesota, you have the option to register your business under an official name while operating under a different one. This is known as a Doing Business As (DBA) name. To establish a DBA, you must file an Assumed Name Certificate with the appropriate county recorder’s office where your business is located. While these names are subject to federal trademark laws, there is no requirement for a DBA to be unique at the state level.
By understanding and considering these naming options, you can successfully register your business name in Minnesota and protect your brand identity.
Step 3: Consider Taxes and Other Costs in Minnesota
When starting or operating a business in Minnesota, it’s important to consider taxes and other associated costs.
Employer Payroll Tax Withholding
All employers in Minnesota are required to withhold federal taxes from their employee’s wages. The current federal withholding rate is 15.3%. Employers are also responsible for paying 7.65% of their employees’ taxable wages
Minnesota Sales Tax
The Minnesota sales tax rate is 6.875% statewide. Local taxing jurisdictions, such as cities and counties, may impose additional sales taxes. Businesses that sell taxable goods or services in Minnesota are required to collect sales tax.
Minnesota LLCs may also be subject to other taxes, such as franchise taxes, excise taxes, and property taxes. It’s important to consult with an accountant or tax advisor to determine which taxes apply to your business.
In addition to the taxes listed above, Minnesota LLCs may also be subject to certain fees, such as the filing fee for the Articles of Organization and the annual report filing fee. The filing fee for the Articles of Organization is $155 for an expedited online or in-person filing and $135 to file by mail. The annual report filing fee is $60.
To enhance the ease of registration, business owners in Minnesota can leverage the capabilities of online services, exemplified by ZenBusiness. Known for its extensive offerings, ZenBusiness provides a range of services aimed at facilitating the registration process for entrepreneurs. These encompass assistance with filings required by the Secretary of State, acquiring an Employer Identification Number (EIN), and establishing an operating agreement.
Furthermore, ZenBusiness extends ongoing compliance support to ensure businesses maintain favorable standing within the state.
Step 4: Register and Acquire Licenses and Permits in Minnesota
To ensure compliance and facilitate the smooth operation of your business in Minnesota, it’s important to obtain the necessary licenses and permits. Here are the key registrations and permits to consider:
Tax Registration
If you plan to sell goods in Minnesota, it’s mandatory to register with the Minnesota Department of Revenue (DOR) to collect sales tax. Additionally, if you have employees in Minnesota, you must register with the Department of Revenue for employer withholding tax. Convenient online registration options are available for both types of taxes.
Employer Identification Number (EIN)
If your business has employees or is subject to separate taxation, obtaining a federal Employer Identification Number (EIN) from the IRS is essential. Even if not required, there are often business benefits associated with having an EIN.
Financial institutions often require an EIN to open business accounts, and other companies you engage with may request an EIN for payment processing. Obtaining an EIN involves completing an online application, and there are no filing fees.
Regulatory Licenses and Permits
Regulatory licenses and permits encompass various areas, including health and safety, environmental compliance, building and construction, and specific industries or services. The Bureau of Business Licenses (BBL), known as License Minnesota, provides information about the state’s business licenses.
The BBL publishes a comprehensive State of Minnesota Directory of Licenses and Permits, and additional details can be found on the License Minnesota (elicense) website. For local licenses and permits, it’s advisable to consult the websites of the relevant cities or counties where your business will operate.
Professional and Occupational Licenses
Professional and occupational licenses are specific to individuals working in various fields. The License Minnesota website’s State Agencies section offers information about state agencies responsible for licensing and regulating professions and occupations.
By ensuring compliance with the required licenses and permits, you will operate within the legal framework and meet industry-specific standards. It’s recommended to utilize the official resources provided by the relevant authorities and complete the necessary application processes diligently.
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Step 5: Open a Bank Account For Your Business in Minnesota
Upon obtaining your EIN, it’s necessary to open a business bank account in Minnesota.
The legal framework governing LLPs, LLCs, and corporations requires the establishment of a business bank account. However, sole proprietors and unincorporated partnerships are not mandated to maintain separate personal and business accounts.
The process of opening a business account in Minnesota involves visiting a local bank and completing the necessary documentation. It’s prudent to thoroughly evaluate and compare the rates and benefits offered by various banks before selecting a preferred provider.
Even if you operate as a sole proprietor or an unincorporated partnership in Minnesota, it’s advisable to maintain a designated company bank account to ensure the separation of personal and business finances. Should you choose to incorporate your business in the future, this proactive approach will save you potential challenges.
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Step 6: Protect Your Intellectual Property in Minnesota
Depending on the type of business you’re establishing in Minnesota, it’s important to protect your valuable intellectual property (IP).
For instance, most businesses seek to prevent their name and logo from being copied and used by others. Depending on whether your business involves the sale of goods or the provision of services, you may also want to protect the design of your products or the creative works (such as writing, designs, or music) that you produce.
Minnesota provides several avenues to accomplish this goal, and initiating the necessary applications promptly is beneficial to ensure that others cannot use your IP without authorization.
Trademark
In Minnesota, a trademark is a recognizable symbol, phrase, word, or design that distinguishes a product or service from similar offerings in the market.
To obtain legal protection, trademarks must be registered with the United States Patent and Trademark Office (USPTO). The registration process typically takes four to six months. Once registered, the trademark is protected nationwide, and legal action can be taken against any unauthorized use.
Businesses in Minnesota can protect their trademarks by registering them with the USPTO. This not only safeguards their brand and reputation but also provides legal recourse against unauthorized use of the trademark.
Copyright
In Minnesota, original works of authorship, including literary, dramatic, musical, artistic, and certain other intellectual works, are protected by copyright law. This includes written content, software, web content, films, sound recordings, images, and other forms of creative expression.
When you create a new work in Minnesota, copyright protection is automatically granted to you as the creator. As the owner of exclusive rights to distribute, reproduce, create derivative works, and sell intellectual property, you have the legal authority to control the use of your work.
However, registering your copyright with the U.S. Copyright Office can provide additional legal protection and serve as evidence of ownership. Registering your copyright in Minnesota helps protect your work against infringement and provides a means to enforce your rights in court, if necessary.
Patent
If you invent a new product or piece of machinery in Minnesota, it’s advisable to obtain a patent. A patent grants the holder exclusive rights over the item, preventing others from making, selling, or importing the patented invention for a specified period.
The patent process is complex and can take up to five years to complete. Therefore, it’s best to start the process early if you have a unique invention that requires protection. Patent applications are submitted to the United States Patent and Trademark Office (USPTO).
By protecting your intellectual property in Minnesota, you can safeguard your brand, products, and creations, ensuring that your business maintains a competitive edge and continues to thrive.
Step 7: Set Up Your Payment Infrastructure in Minnesota
To ensure the swift initiation of your registered business operations in Minnesota, it’s crucial to establish a seamless and hassle-free payment infrastructure that enables you to accept payments effortlessly.
Numerous payment processing services are available, offering user-friendly interfaces and seamless integration options for your website or point-of-sale (POS) system. Noteworthy options include Square, Stripe, and PayPal, all of which provide flexibility and easy setup, allowing you to customize them to align with your specific business objectives.
These payment processors enable you to accept a wide array of payment methods, including credit and debit cards, ACH transfers, digital wallets like Apple Pay and Google Pay, and more. By selecting a dependable payment processing service, you can offer your customers the convenience of paying through their preferred methods on a secure platform, ensuring a smooth and secure transaction experience for both you and your esteemed clients.
Furthermore, establishing sales tax compliance in Minnesota is essential. This involves obtaining a Minnesota Sales and Use Tax Permit from the Minnesota Department of Revenue, granting you the authority to collect sales tax on taxable goods and services.
With a well-established payment infrastructure in place, your Minnesota-based business will be well-equipped to efficiently serve customers, generate revenue, and comply with legal obligations.
Top 5 Business Registration Services for Minnesota Entrepreneurs
When it comes to registering a business in Minnesota, entrepreneurs and small business owners have access to several distinguished business registration services. These services offer a wide range of solutions to facilitate business establishment and ensure compliance with state and federal regulations.
Here are some of the finest business registration services tailored to Minnesota entrepreneurs:
ZenBusiness
ZenBusiness is an online business registration service that specializes in business formation, registered agent services, annual report filing, and more. They offer affordable pricing and comprehensive packages that include personalized support and resources, empowering businesses to maintain compliance and foster growth.
ZenBusiness provides a user-friendly website and streamlines the registration process, making it easy for entrepreneurs to register their businesses in Minnesota.
Swyft Filings
Swyft Filings is a reputable business registration service that offers fast and seamless business formation, including LLC formation, incorporation, and compliance. They provide personalized support and resources to guide businesses through the formation process and ensure compliance with state and federal regulations.
Swyft Filings has a user-friendly website and provides affordable pricing, simplifying the registration process for Minnesota entrepreneurs.
Tailor Brands
Tailor Brands is an online branding and design service that helps businesses create a professional and cohesive brand identity. They offer a variety of branding packages, including logo design, business card design, and social media branding.
Tailor Brands also provides a suite of design tools and resources to help businesses create and customize their own branded assets. While not a traditional business registration service, Tailor Brands can help businesses establish a professional brand image to attract customers effectively.
Northwest Registered Agent
Northwest Registered Agent is an online LLC formation service that specializes in registered agent services, compliance management, and document filing. They have a strong reputation for quality and exceptional customer service, offering personalized support to help businesses stay compliant with state and federal regulations. Northwest Registered Agent provides a range of business formation services for LLCs, corporations, and nonprofits.
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Bizee (Previously Incfile)
Bizee is an online business registration service that offers fast and affordable business formation services. They provide various packages that include registered agent services, compliance management, and document filing. bizee platform is user-friendly and streamlined, making the business registration process easy and hassle-free. They also provide ongoing support and resources to help businesses stay compliant and grow.
Each of these business registration services offers distinct features and benefits tailored to Minnesota entrepreneurs. By researching and comparing these services, entrepreneurs can find the best one to meet their specific needs and make the registration process easy and efficient.
Business Registration Laws in Minnesota
If you plan to start a business in Minnesota, you’ll need to comply with certain registration requirements. Here are some key points regarding business registration laws in Minnesota:
- Business Structure: Choose a business structure for your company. The common types include sole proprietorship, partnership, corporation, and Limited Liability Company (LLC). Each structure has its own requirements and implications for taxation, liability, and management.
- Business Name: Select a unique name for your business that complies with Minnesota’s naming rules. The name should not be confusingly similar to any existing business entities in the state. You can check name availability through the Minnesota Secretary of State’s website.
- Registered Agent: Appoint a registered agent who will receive legal and official documents on behalf of your business. The registered agent must have a physical address in Minnesota and be available during regular business hours.
- File Formation Documents: Register your business entity by filing the appropriate formation documents with the Minnesota Secretary of State. The required documents depend on the business structure:
- Sole Proprietorship/Partnership: No formal filing is required at the state level, but you may need to register your business name with the county or city where you operate.
- Corporation: File Articles of Incorporation with the Secretary of State. Include information about the company’s name, registered agent, business purpose, and other necessary details.
- Limited Liability Company (LLC): File Articles of Organization with the Secretary of State. Provide information about the LLC’s name, registered agent, management structure, and other relevant information.
- Employer Identification Number (EIN): Obtain an EIN from the Internal Revenue Service (IRS) if you plan to hire employees, have multiple members in your LLC, or if your business requires an EIN for tax purposes. You can apply for an EIN online on the IRS website.
- Licenses and Permits: Depending on the nature of your business, you may need to obtain specific licenses and permits at the federal, state, and local levels. The requirements vary based on your industry, location, and activities. The Minnesota Department of Employment and Economic Development and local city or county offices can guide necessary licenses and permits.
- Taxes: Register for state and local taxes with the Minnesota Department of Revenue. The specific taxes you may need to pay include income tax, sales tax, and employer withholding taxes.
Remember, you should consult with a professional familiar with Minnesota’s current laws and regulations or visit the Minnesota Secretary of State’s website for more detailed and accurate information.
Alternative Business Registration Methods in Minnesota
In Minnesota, the primary method of business registration is through the Office of the Minnesota Secretary of State. However, there are alternative business registration methods available as well. Here are a few options:
Professional Assistance
Seeking the help of an attorney or a business formation service can be an alternative method for business registration in Minnesota. These professionals are knowledgeable about the registration requirements and can assist you in navigating the process, ensuring that all necessary documents and filings are completed accurately.
Local Small Business
Development Centers (SBDC): SBDCs in Minnesota offer free or low-cost resources and assistance to entrepreneurs and small business owners. They can guide various aspects of starting and running a business, including business registration. SBDC advisors can help you understand the registration requirements and provide support throughout the process.
County Recorder’s Office
Depending on the type of business you’re registering, you may be required to register at the county level. Some counties in Minnesota allow businesses to register directly with the County Recorder’s Office. Contact your local County Recorder’s Office to inquire about their specific registration procedures.
It’s important to research and understand the specific requirements for your business type and consult with professionals or official government sources for accurate information. Ensure compliance with all legal requirements and regulations when registering your business in Minnesota.
Benefits of Registering Your Business in Minnesota
Registering your business in Minnesota offers several benefits that can contribute to its growth and success. Here are some key advantages of registering your business in Minnesota:
- Legal Entity Protection: Registering your business as a legal entity, such as an LLC or corporation, provides personal liability protection. This means your personal assets are generally shielded from business debts and liabilities.
- Enhanced Credibility: Registering your business demonstrates professionalism and legitimacy to customers, suppliers, and partners. It can help build trust and enhance your reputation in the marketplace.
- Access to Government Contracts: Registered businesses may qualify for government contracts, grants, and other business opportunities. The State of Minnesota and local municipalities often have programs and initiatives that support local businesses.
- Brand Protection: Registering your business name and logo as trademarks in Minnesota helps protect your intellectual property. It provides legal recourse in case of trademark infringement and prevents others from using your brand identity.
- Banking and Financing: Registered businesses have an easier time opening business bank accounts, obtaining loans, and establishing credit. Lenders and financial institutions generally prefer to work with registered entities, as it provides a level of transparency and accountability.
- Tax Advantages: Registering your business in Minnesota allows you to take advantage of various tax benefits and incentives. These may include deductions, credits, and exemptions specific to the state, potentially reducing your overall tax burden.
- Access to Resources and Support: Registering your business makes you eligible for resources, workshops, and support services provided by the state, local chambers of commerce, and business organizations. These resources can help you navigate legal requirements, access training programs, and find networking opportunities.
- Perpetual Existence: Registering your business as a legal entity provides continuity and perpetual existence beyond the lifespan of its owners. This ensures that the business can continue to operate and transfer ownership smoothly.
- Employee Recruitment and Retention: Being a registered business can enhance your ability to attract and retain quality employees. It demonstrates stability, professional practices, and compliance with employment laws, giving potential employees confidence in your business.
- Expansion Opportunities: Registering your business in Minnesota allows you to expand operations within the state and potentially seek opportunities beyond its borders. It opens doors to local partnerships, collaborations, and access to a diverse customer base.
It’s important to consult with a legal and tax professional to understand the specific advantages and requirements for your business based on its nature, structure, and location within Minnesota.
Are Businesses in Minnesota Required to Register? Find Out the Specifics Here
Indeed, businesses operating in Minnesota are typically required to register with the state. The registration requirements vary depending on the type of business entity, the nature of the business operations, and other pertinent factors. Examples of common registrations include obtaining a Minnesota Sales and Use Tax Permit, registering a Minnesota Limited Liability Company (LLC) or Corporation, and acquiring professional licenses or permits applicable to certain industries.
It’s vital to conduct thorough research on the specific requirements for your business and adhere to all registration obligations to mitigate potential legal and financial consequences.
How to Register Your Business in Minnesota – Frequently Asked Questions
How Can I Go About Registering a Business in Minnesota?
To register a business in Minnesota, what are the necessary procedures and paperwork that need to be followed and filed with the Minnesota Secretary of State? The exact requirements will depend on the type of business, but typically, you will need to complete an Articles of Organization, appoint a registered agent, and obtain any required licenses or permits.
What Is the Registration Fee for Forming a Company in Minnesota?
The registration fee for forming a company in Minnesota depends on the legal structure of your business and the type of filing you’re engaging in. For a Minnesota LLC, the filing fee for an Articles of Organization is $135. Other filings and permits essential to your business operations may involve supplementary costs.
Is It Feasible for Foreigners to Establish Businesses in Minnesota?
Foreigners have the opportunity to establish businesses in Minnesota as long as they meet the requisite legal requirements. Foreign business owners may need to acquire suitable visas or work permits, and they might also be obligated to register their businesses with additional state and federal entities.
Do I Need to Register My Online Business in Minnesota?
The requirement to register your online business with the state of Minnesota will depend on the specific nature of your business activities and the type of business structure you have chosen. Sole proprietorships and partnerships may not have a mandatory registration obligation, while corporations and LLCs are likely to require registration.
Moreover, it may be necessary to obtain certain permits and licenses, such as a sales tax permit from the Minnesota Department of Revenue.
To ensure compliance with the comprehensive laws and regulations governing businesses in Minnesota, it’s advisable to consult with a qualified attorney or accountant. Their expertise will prove invaluable in navigating the legal intricacies and ensuring adherence to all applicable laws and regulations.
Bottom Line on How to Register Your Business in Minnesota
Enrolling your business in Minnesota is a pivotal move to ensure compliance with state laws and regulations. Though it might appear daunting, following key steps and meeting prescribed criteria can lay a solid groundwork for your enterprise.
Vital factors include selecting a business name and legal structure that adhere to the guidelines set by the Minnesota Secretary of State, completing requisite paperwork, and acquiring any necessary licenses and permits pertinent to your industry and location. To simplify the process and guarantee adherence, consider employing a business registration service such as Northwest Registered Agent.
Devoting effort to properly register your business in Minnesota can proactively address legal and financial concerns down the line, positioning you for enduring success.
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About the author
Dr. Gabriel O'Neill, Esq., a distinguished legal scholar with a business law degree and a Doctor of Juridical Science, is a leading expert in business registration and diverse business departments. Renowned for his academic excellence and practical insights, Dr. O'Neill guides businesses through legal complexities, offering invaluable expertise in compliance, corporate governance, and registration processes.
As an accomplished author, his forthcoming book is anticipated to be a comprehensive guide for navigating the dynamic intersection of law and business, providing clarity and practical wisdom for entrepreneurs and legal professionals alike. With a commitment to legal excellence, Dr. Gabriel O'Neill, Esq., is a trusted authority dedicated to empowering businesses within the ever-evolving legal landscape.