Start an LLC in North Dakota

Last updated on: October 5, 2021

Getting a brand new business off the ground may seem like a task inaccessible to first-time entrepreneurs, but North Dakota is a state with a well-developed business infrastructure. This is one of the few states that let the owners oversee almost every aspect of business management electronically, allowing you to create LLC online without even leaving your house.

If you don’t have even the slightest idea of how to open an LLC in North Dakota or where to start, there are dozens of affordable LLC services that can not only help you get familiar with the process but also handle it on your behalf.

Additionally, you have the option of opening a professional LLC in North Dakota, whether it’s to establish a solo practice or partner up with other professionals. If you already have an LLC in North Dakota but want to branch out, the state supports the North Dakota Series LLC business model which is essentially a set of different LLCs functioning under a single parent company.

And even if your only aim is to get a traditional LLC, the formation here is a bit more straightforward compared to some jurisdictions and even skips a few steps that normally figure in other formation processes. 

Come Up With a Business Name

Check Your Business Name

The first step of making an LLC in North Dakota is finding an appropriate name for the company. The state’s guidelines stipulate that a North Dakota LLC name should be unique and clearly distinguishable from the names of already existing entities. You can use the state’s business search tool to find if your preferred name is available.

The name must also feature the business structure designation (“LLC,” “L.L.C.”) and avoid forbidden words that might hint at the company’s affiliation with highly regulated industries it does not belong to. The state also allows you to search the records for $5.

Reserve a North Dakota LLC Name

For the organizers that don’t plan on filing the LLC documents immediately, the state offers the option of reserving the desired name for up to 1 year. After the end of this period, you can potentially renew it for 1 more year. This application can be submitted online, by mail, and through fax. This service costs only $10. Depending on the Secretary of State’s workload, the processing might take between 7 and 10 days.

Online

Quite naturally online applications to reserve a name for a business in North Dakota are the most convenient and don’t require any additional costs for postage—you can handle the entire process on the state’s website.

Mail

For postal filings, the applicant must fill out the Reserve Name Application form and send it to:

Secretary of State
State of North Dakota
600 E Boulevard Avenue Dept 108
Bismarck ND 58505-0500

Fax

Fax submissions are the more convenient alternative to mail filings and should be sent to:

(701) 328-2992

In North Dakota, LLCs can use trade names, sometimes called assumed names or DBAs, to conduct business in the state. By establishing an LLC that handles a wide range of services, you risk running into some confusion with your target markets, so it makes sense to distinguish yourself from other companies via a trade name.

Trademarks or service marks are distinct from the name under which the business was registered and can be used in the course of the company’s operation. Registering a trade name costs $25 regardless of your filing method: online, fax, or mail. You can apply by sending SFN 13401 to the SoS office.

Find a Registered Agent in North Dakota

As is the case with other states, opening an LLC in North Dakota cannot be accomplished without an LLC registered agent. The state’s adoption of the Model Registered Agents Act sets it apart from other jurisdictions in terms of legislative uniformity that the governing agencies exercise over state entities that are legally required to maintain an agent.

Anyone doing business in North Dakota must employ commercial and non-commercial agents as long as the entity is active. The duties of such an agent can be carried out by an individual who is a resident or a domestic or foreign entity (LLC or corporation) authorized to operate in the state. Unlike some states, North Dakota doesn’t allow entities to act as their own agents. 

Individual as North Dakota Registered Agent LLC

Some owners choose to save money and appoint someone they know. If you’d rather work with a professional agent for service of process but want to find someone independent of LLC formation bundles, the state provides handy lists of registered agents for a commercial appointment.

Hiring Registered Agent Services

If you want to keep all your services in one place, plenty of incorporation agencies offer this feature in their formation plans. Providers like IncFile LLC Service and Mycompanyworks offer a free registered agent service with their bundles, though you will have to start paying annual fees after the trial period.

Apply For an EIN

Also called a Tax ID, Employer’s Identification Number is a requisite applied to all owners starting a North Dakota LLC that intend to employ workers. The number is used by the IRS to keep track of a company’s financial activities. Without an EIN, you won’t be able to open a financial account in your company’s name, which in turn will deprive you of limited liability protections. There are three ways to file for a North Dakota EIN, and although the service itself is free, some additional postage fees may apply in certain cases. 

Online Filing

By applying for LLC EIN online, you will likely be able to get your number immediately. This method is not only the fastest but is also completely free of charge. 

By Mail

If you prefer to handle all your North Dakota LLC formation documents the old-fashioned way, you can apply by sending Form SS-4 to:

Internal Revenue Service Operation
Attn: EIN Operation
Cincinnati, OH 45999

Fax

Another way to receive your EIN number North Dakota is by faxing Form SS-4 to:

(855) 641-6935.

Prepare an Operating Agreement for a North Dakota LLC

Although entity registration doesn’t technically require you to draft an operating agreement LLC, most industry specialists strongly advise in its favor. This document is designed to establish the internal rules of the company, its operational procedures, membership rights, and generally acts as proof of your company’s limited liability status.

So when you set up an LLC in North Dakota, this document is one of the first steps you should look into. If you aren’t sure how to create operating agreement LLC, there are plenty of templates online, though they tend to be pretty general in nature. Fortunately, formation companies like Rocket Lawyer provide more customized templates for various types of businesses. Their information center also offers detailed guides on how to get an LLC in North Dakota and succeed at its maintenance.

Open a Bank Account For an LLC in North Dakota

While business accounts may not be a requirement for sole traders, they are absolutely essential for retaining the corporate veil for LLCs and corporations. If you cannot legally prove that your personal account is separate from your business, all your securities may come under the threat of litigation. This is why North Dakota LLCs are such a popular business structure—they ensure total personal asset protection and absolve you of personal liability. Needless to say, opening a business checking account is vital for safeguarding your personal property against potential lawsuits.

File the North Dakota Articles of Organization

Similar to other states, the North Dakota LLC Articles of Organization is a legal document that officially declares an entity open. To register an LLC in North Dakota, the owners must draft these LLC formation documents according to state guidelines and send them to the Secretary of State. The filing fee is $135 which is slightly higher than average. 

Online

This is undoubtedly the preferred method of filing North Dakota LLC Documents. You can do so by registering with First Stop online services and following the instructions as detailed in their FAQ. Normal processing time is about 2-3 weeks.

Hard Copy Filing

Although applying with paper documents is technically a possibility, it’s generally advised against this due to longer waiting times. The receiver address for articles of organization in North Dakota is:

Secretary of State
State of North Dakota
600 E Boulevard Avenue Dept 108
Bismarck ND 58505-0500

Additional Requirements For a North Dakota LLC

Once you’ve taken care of the basics like registration, it’s time to cover the state’s major maintenance requirements such as regular reporting, licensing, and taxation. 

File LLC Annual Reports

As soon as you establish an LLC in North Dakota, one of your primary compliance tasks becomes submitting your annual report on time along with the $50 state fee.

It’s important to keep up with your deadlines since late reports may result in monetary penalties or even lead to your entity being classified as delinquent.

The easiest way to handle your North Dakota annual report filing is through the First Stop portal where you can access your formation documents and check the end dates. 

Those who want to send their North Dakota LLC annual reports through mail can do so by forwarding the documents to:

Annual Report Processing Center
Secretary of State
State of North Dakota
PO Box 5513
Bismarck ND 58506-5513

Obtain North Dakota Business Licenses

Although not every entity needs a North Dakota business license, most companies will have to register for various state licences depending on their size and industry. There are three major forms of LLC licenses based on who issues them: 

  • The Secretary of State (notaries, contractors, etc);
  • Professionals boards and commissions;
  • Attorney General (alcohol, gaming, tobacco, etc).

Company members who provide specialised services that fall under heavily regulated industries may also need to obtain professional licenses in addition to the general ND business license. More information about regulatory boards and application procedures can be found at North Dakota’s licensing page.

Comply With LLC Tax Filing Requirements

State Taxes

The most common taxes in North Dakota are the sales taxes which cover a wide range of industries from ad agencies to machine shops and various county-specific guidelines. To do business in North Dakota, you may also need to obtain local permits, though the only way to learn about their specifics is through your local county clerk. 

Federal Taxes

Given that LLCs are flow-through entities by default, they are exempt from the regular income tax. What the owners do instead is record all profits and losses through their personal reports every tax year which is due April 15. However, there are some federal taxes that may apply based on your annual revenue. Visit the IRS website for more information regarding small business taxation.

Additional Taxes

Any company that hires workers qualifies for withholding and unemployment insurance taxes. The first one is calculated based on individual wages, while the second one is applied to every 7 thousand dollars per employee at the rate of 6%. All of these LLC tax filings can be handled through the North Dakota Taxpayer Access Point program as well as Unemployment Insurance Employer Account System (UI EASY). Most workplaces with employees will also need to obtain worker’s insurance according to the state’s safety guidelines.

Conclusion

Overall the process of North Dakota LLC creation is less demanding than some states but still requires a degree of legal knowledge. There are certain requirements that are specific to LLC businesses in ND and need thorough research, specifically local licensing as well as the state’s unique approach to register agents and electronic taxation.
If it’s your first time establishing any form of business in this jurisdiction, it’s always best to consult a professional, whether it’s attorney or LLC services. Launching a company on your own may be less expensive, but the risk of making a critical error is far greater. And if your funding is more or less stable, you can always use one of the certifiably reliable LLC formation companies for various business solutions, even including a free LLC and registered agent services.

Senior Business Tax Writer, etc
Jean Wilson Murray
https://bestllcservices.co/
(323) 789-5289
Senior Business Tax Writer, etc
Jean Wilson Murray

In this IncFile vs ZenBusiness review, we're going to compare two of the most popular LLC formation services based on pricing, features, and drawing out differences and similarities to let you see which is most suitable for you and your business.

You can learn more about @Mike here.

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