An LLC must file an annual report with the Secretary of State’s Office within 30 days after its organization date. This report includes the name of the LLC, the names of each member, the address of the principal place of business, the address of the registered agent, and the filing fee. If an LLC does not have a principal place of business, you are required to designate one. In addition, an LLC must file a federal corporate income tax return if it has gross receipts or sales of $10,000 or more during any taxable year. You must pay taxes on any net profits earned by the LLC, even if those profits are distributed to members.
A registered agent must be designated for the service of process for an entity. If there is no registered agent, anyone purporting to act on behalf of the entity must provide proof of authority.
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State Business Tax
Most states do not charge an additional tax on limited liability companies (LLCs). However, a few states, like New York, California, Delaware, Florida, Illinois, Indiana, Maryland, Michigan, Missouri, Ohio, Pennsylvania, Texas, Virginia, Washington, and Wisconsin, levy an additional tax on LLC formation.
There’s no extra tax on LLCs in North Dakota. Why? Because the state doesn’t want to encourage businesses to move out of state.
In fact, many states actively discourage the creation of LLCs because it allows individuals to form corporations without paying taxes. For example, in most states, you must pay income tax on profits earned by a corporation. However, there are exceptions to this rule, such as in Wyoming where a person pays no corporate income tax.
The bottom line is that some states impose an extra tax on LLCs while others don’t. If you’re looking to incorporate in one of those states, make sure you know what the rules are before you decide to file.
State Employer Taxes
Employers must pay payroll taxes based on how many hours their workers work. This includes Social Security and Medicare taxes. These payments are calculated based on the number of full-time equivalent employees that worked during the tax period. If you hire seasonal workers, you may want to consider hiring part-time workers instead.
Federal employers do not pay payroll taxes. Instead, they withhold income taxes from employee wages. Federal employers do not report earnings data to the IRS or contribute to social security and Medicare accounts.
If you hire temporary help, you may consider registering your company with the IRS. You will still have to file quarterly returns, but you will not have to pay payroll taxes.
You may qualify for a refund if you don’t owe any taxes. Check with your accountant to see the type of return you must file.
For example, California requires companies with over $500,000 in gross receipts to obtain an Employer Identification Number (EIN). Companies without employees must use Form SS-4.
The Internal Revenue Service charges a processing fee to issue an EIN. In addition, there is a monthly renewal fee.
Some states require businesses to provide proof of insurance, such as Worker’s Compensation Insurance. Some states require businesses to provide copies of W2 forms.
Registration in the Other States
Each state has different laws regarding forming an LLC. Some states require you to register even if you plan to operate solely within the state. Others don’t care whether you’re operating locally or nationally.
The most common way to form an LLC in the United States is via articles of organization. This method requires filing papers with local authorities. It might seem like a lot of work if you’ve never formed an LLC before. But once you do it once, you’ll know how to do it again. And each state offers a variety of forms and fees to make the process easier.
There are several other options for creating an LLC. You could use a manager agreement, where one person acts as both the owner and operator of the business. Or you could use an operating agreement, which lets multiple people manage the entity.
1. Name your North Dakota LLC
The state of North Dakota requires you to file an Articles of Organization form with the Secretary of State’s office within 30 days of forming your limited liability company. This document must include the following information:
• Your full legal name
• A description of the type of entity being formed
• The names and addresses of each member of the LLC
• The address where the registered agent will receive the process
• The date the articles are filed
• The date the initial membership meeting is held
• Any amendments to the articles
• An expiration date for the articles
Once you complete the registration form, print it out and send it to the Secretary of State‘s office.
2 Register an agent in North Dakota
To register an LLC or corporation in North Dakota, you must appoint a registered agent. This person will receive legal notices and process paperwork related to the entity. You could face fines or jail time if you do not appoint one.
Appointing a registered agent is easy. You simply fill out the form online and mail it to the Secretary of State’s office. A fee will be charged based on how long you want the appointment to remain active. For example, a six-month term costs $50.00.
Once you appoint a registered agent, you cannot change it without paying another fee. However, if you decide to cancel the appointment, you will still owe the initial registration fee.
If you choose to appoint a different registered agent, you must send a notice to the previous registered agent. Once the notice is received, the old registered agent will no longer be able to accept legal papers for the entity.
The most common reason for appointing a registered agent is to avoid penalties if you fail to timely file corporate documents or pay state taxes
3. File articles of organization for North Dakota business
To form a limited liability company in North Dakota, you must file articles of organization with the Secretary of State. In addition to paying the initial $100 filing fee, you’ll also need to submit a copy of your federal income tax return for the previous three years. If you’re self-employed, you’ll need to provide proof of insurance.
Once you’ve filed your articles, you’ll receive a certificate of filing from the Secretary of State. You can find this information in your First Stop account once it becomes active.
You’ll want to file your articles of organization within 30 days of forming your LLC. After that, you’ll need to renew your articles every four years.
4 Create an Operating Agreement
An operating agreement is one of those things that most small businesses don’t think about much. But it’s very important. There are several different types of agreements, each designed to serve a specific purpose. And while some people use them just once, others might find themselves needing to update their operating agreement every few months. So let’s take a look at four common ones.
The first type of operating agreement is called a “management contract.” This is usually used by a single owner, such as a sole proprietorship or partnership. Management contracts typically cover topics like the relationship between the owners, how to handle disputes, and how to distribute profits. They’re often written up simultaneously as business formation documents.
The second type of operating agreement is known as a “shareholder agreement.” Corporations, LLCs, and partnerships typically use these. Shareholders agree on how the company will be run, including how to divide up profits and losses, how to resolve disagreements, and how to dissolve the company.
The third type of operating agreement is referred to as a “joint venture agreement.” Joint ventures are similar to shareholder agreements, except that they involve multiple shareholders rather than just one.
Finally, we come to the fourth type of operating agreement — the “operating agreement.” Operating agreements are typically used by larger companies, particularly those with employees. These agreements set forth rules from employee benefits and compensation to workplace safety and discipline.
So now that you know an operating agreement, why do you need one? Well, for starters, it protects you against personal liability. If someone gets hurt at work, for example, they could sue you personally, even though you didn’t cause the injury yourself. By creating an operating agreement, however, you limit your exposure to lawsuits related to the operation of your business.
And finally, an operating agreement can help protect your business interests. For instance, if you sell your business, you’ll want to ensure that whoever buys it doesn’t disappear with half the assets. To avoid this problem, you’d probably include language in your operating agreement stating that the buyer agrees to assume certain liabilities, such as debts owed to vendors and employees.
5. Apply for an EIN
The Internal Revenue Service (IRS) offers free e-filing for individuals and businesses. If you file your federal income tax return electronically, you must apply for an Employer Identification Number (EIN). You can do it online or by phone.
Once you have applied for an EIN, you can print off a copy of your application. This document is called Form SS-4.
If you want to apply for an EID number by fax, call the IRS Fax Center at 800-829-4933.
Frequently Asked Questions
How to Obtain a Certificate of Good Standing in North Dakota
A Certificate of Good Standing verifies that your limited liability company (LLC) was legally formed and has remained properly maintained since it was filed. In addition to verifying your legal status, obtaining a certificate of good standing lets you apply for financing, obtain certain types of licenses, and renew some business licenses. If you want to file a Certificate of Good Standing online, there are several ways to do so.
You can request a Certificate of Good Standing via email, phone, mail, or Internet. You can request a Certificate of Good Standing online here. Requesting a Certificate of Good Standing is at no charge, but you must verify your identity and provide proof of payment.
How to Dissolve an LLC in North Dakota
If you want to close your business tax account, file your articles of dissolution, and pay off outstanding debts, you must take certain actions within 90 days. You cannot simply wait until the end of the year to dissolve your LLC; doing so could result in serious consequences. For instance, failure to properly dissolve your LLC can lead to fines, penalties, and even criminal charges. Additionally, some states require that you file a certificate of good standing with the secretary of state, which is required to open a bank account or obtain a loan, among other things. However, this process can be complicated because many people don’t know what to look out for.
James Rourke is a business and legal writer. He has written extensively on subjects such as contract law, company law, and intellectual property. His work has been featured in publications such as The Times, The Guardian, and Forbes. When he’s not writing, James enjoys spending time with his family and playing golf.