Do you intend forming an L.L.C. in Missouri and have no idea on what to do? Do you want to start a business in Missouri and want to form an LLC? If YES, here is how much it cost to form an LLC in Missouri successfully.
However, before we get started, let us take a quick look at Missouri and the benefits of creating an L.L.C. in the city. Missouri is a perfect place to start a Limited Liability Company. It is affordable, and there is no too much paperwork. For starters, to make sure we are on the same page; a limited liability company is a business structure that can be owned by a single person or group of persons.
Forming a business as an L.L.C. helps protect the owner(s) against a lawsuit, cuts down the expenses of paperwork, makes the company more credible, and prevents it from being taxed twice. Forming an L.L.C. in Missouri is affordable and simple. However, it comes with a filing different from other states in the United States. Read on to discover the things you need to do.
Starting a Business – How to Form an LLC in Missouri in 12 Steps
Table of Content
- STEP 1: Choose A Name for Your Limited Liability Company (LLC)
- Step 2: Appoint A Registered Agent in Missouri
- Step 3: Prepare and File the Missouri Articles of Organization and Transmittal Form
- Step 4: Create an Operating Agreement
- Step 5: Acquire an Employer Identification Number
- Step 6: Missouri LLC Annual Report and Personal Property Tax Return
- Step 7: Securing Business Licenses and /or Permits
- Step 8: Sort – Out Taxes
- Step 9: Open Your LLC Bank Account
- Step 10: Apply and Obtain Your Business Phone Number
- Step 11: File Your LLC Annual Report
- Step 12: Hiring of Employees
It is up to you to come up with a name for your L.L.C. In Missouri, your name ought to be unique and come with the abbreviation L.L.C. or include the words “Limited Liability Company. Missouri law explicitly states that your LLC’s name should not be “misleadingly similar” to the names of other businesses on record with the Department of Assessments and Taxation.
To give you a better understanding, here are some of the naming guidelines for Missouri:
- Your company name must contain the phrase “Limited Liability Company” or any of its abbreviations (L.L.C. or L.L.C.)
- Your company should not include words or phrases that might make the public confuse your company with a government agency such as F.B.I., State Department, NASA, Treasury. Examples of such restricted words include Bank, University, and Attorney.
- If you want to make use of restricted words like Attorney, Bank and the rest, you will need more paperwork as well as a licensed individual such as a lawyer or doctor to be members of your L
- You can check if the name you intend to use is available by carrying a search business
So also, you must make sure that the name you want to use is not already taken. You can be check if the name is unique by searching the name on the State of Missouri Website. Also, make sure your business can use its name as a web domain. Even though creating a business website is not on your plan, it is best you purchase the URL to stop others from using it.
After you have registered a domain name, consider creating a professional email account. A professional email that makes use of your domain name is vital to establishing trust between your business and its customers. In this modern era, where scam is on a high, companies need to make use of a professional email address to provide a sense of professionalism and credibility.
Step 2: Appoint A Registered Agent in Missouri
Next, you are required to choose a registered agent for your L.L.C. in Missouri. A Resident Agent is the person or company who receives your LLC’s documents, notices and legal mail (called Service of Process). Because of this, the Resident Agent must have an actual street address in Missouri (PO boxes are not allowed by the state).
Picture your registered agent as your company representative to the state. It is important to note that not everyone can be a registered agent. For a person to be eligible to become a registered agent, the person or corporation must be a resident of Missouri.
That is to say, the individual or corporation must have a physical address within the state. If any member knows the ropes of being a registered agent, you may elect him or her rather than hiring one. This will help you save some dollars, especially if you are running a small business.
However, hiring a seasoned registered agent offers tons of benefits like privacy and peace of mind. Please note that you, your friend or family members or a commercial resident agent are qualified to be your LLC’s Resident Agent.
Step 3: Prepare and File the Missouri Articles of Organization and Transmittal Form
For successful registration of your L.L.C., you will be required to file articles of organization. These forms will help you to set up your L.L.C. officially. It is compulsory for the articles to include your L.L.C. name, name of the manager(s) and address(es). State Filing Cost is $50 for Online (Online filers must also pay an additional $1.25 convenience fee.), or $105 By Mail and this fee is Payable to the Secretary of State (Non -refundable)
James C. Kirkpatrick State Information Center
P.O. Box 778
Jefferson City, MO 65102.
Please note that you must submit your completed Articles of Organization before 4:15pm to make sure it gets processed on the same day. For faster service, we recommend arriving right after they open at 8:30am and Missouri LLC approval times is between 4 – 6 weeks (by mail), same-day (walk-in), or 7 business days (online).
Step 4: Create an Operating Agreement
An Operating Agreement lists the rights and obligations of the members of the LLC. These include rules on how the LLC should be run, how taxes are to be paid, and how profits / losses are to be shared among the members.
The Operating Agreement also contains the list of members of your LLC and how much their stake is in the business. Even if you have a Single – Member LLC (you’re the only owner), it’s still best practice to have an Operating Agreement.
Please note that starting in 2018, Missouri’s LLC law requires LLC members to adopt a written operating agreement. The Operating Agreement is the primary document that establishes the rights, powers, duties, liabilities, and obligations of the members among themselves and to the LLC. The Operating Agreement is purely an internal document and is not filed with the Secretary of State.
If an existing or newly created LLC does not adopt an operating agreement, its existing articles of organization, bylaws or operating agreement, and/or its member control or limited liability company agreement will collectively become its operating agreement.
The bottom line is that, in case your LLC is sued, having an Operating Agreement shows that your LLC is operating properly. This helps maintain your personal liability protection.
Step 5: Acquire an Employer Identification Number
An EIN is sometimes referred to as a Federal Employer Identification Number (FEIN) or Federal Tax Identification Number (FTIN) is a 9 – digit number similar to a social security number. The Employer identification number will be used to identify your business. It is like a social security number for your company.
An Employer Identification number is essential because you will need it to open a business account for your company, to hire employees as well as tax purposes. You can obtain your E.I.N. from the I.R.S. after creating your company. You can do it via mail or online. Note: It won’t cost you a dime to get an E.I.N. from the I.R.S.
You can obtain an EIN from the IRS either
- Via mail (approval takes 4 weeks)
- Via fax (approval takes 4 business days)
- Via online application (approval is instant at the end of the application)
In the state of Missouri, annually, all Missouri LLCs are required to file an Annual Report and some Missouri LLCs are required to file an Annual Report and Personal Property Tax Return. An Annual Report keeps your LLC’s contact information up to date with the Missouri Secretary of State.
A Personal Property Tax Return is a tax on any tangible personal property that is owned, leased, consigned, or used (even if owned by someone else) by your Missouri LLC and is located in the State of Missouri.
Some examples of personal property include furniture, equipment, electronics, tools, inventory, computers, cell phones, books, artwork, supplies, and fixtures. The following are not considered personal property: intellectual property, real estate, or vehicles registered with the Motor Vehicle Administration.
- Your LLC’s Annual Report (and Personal Property Tax Return, if applicable) are due each year between January 1st and April 15th.
- Your LLC’s first Annual Report (and Personal Property Tax Return, if applicable) are due after the year your LLC was approved.
Please note that;
- If your LLC was approved anytime in 2017, your first Annual Report (and Personal Property Tax Return, if applicable) are due between January 1st and April 15th of 2018.
- If your LLC was approved anytime in 2018, your first Annual Report (and Personal Property Tax Return, if applicable) are due between January 1st and April 15th of 2019.
Missouri LLC Annual Report fee: The minimum LLC Annual Report fee is $300. If your LLC is also required to file a Personal Property Tax Return, the amount will be higher, based on the amount of personal property taxes that need to be paid.
Please note that in the States of Missouri, you can file your LLC’s Annual Report and Personal Property Tax Return either online (via “Business Express”), by mail, or by walk-in filing. The state prefers online filings though.
Step 7: Securing Business Licenses and /or Permits
The next step you are expected to take is to secure your business license and permits as the case may be. The type of business licenses and / or permits your LLC will need to legally operate in Missouri will depend on its location and the industry it is involved in.
Please note that in order to operate your LLC you must comply with federal, state, and local government regulations. For example, restaurants likely need health permits, building permits, signage permits, etc. The details of business licenses and permits vary from state to state. Make sure you read carefully. Don’t be surprised if there are short classes required as well.
Fees for business licenses and permits will vary depending on what sort of license you are seeking to obtain. To find out more, contact your local agencies in the city, town or county where your LLC is located.
Step 8: Sort – Out Taxes
Federal taxes: LLCs in Missouri have what’s called “pass through” taxation. This means your Missouri LLC does not pay separate federal taxes; instead, all its profits / losses “flow through” to you and are filed with your personal tax return (Form 1040), usually on a Schedule C.
Missouri State and local taxes: In addition to your Personal Property Tax Return, your LLC may also need to file and pay additional taxes, both at the state level, and the local level (county, city, township, etc.) Depending on the nature of your business, you may be required to register for one or more forms of state tax.
Sales Tax: If you are selling a physical product, you’ll typically need to register for a sellers permit through the Missouri Combined Registration Online Application website. This certificate allows a business to collect sales tax on taxable sales.
Sales tax, also called “Sales and Use Tax,” is a tax levied by states, counties, and municipalities on business transactions involving the exchange of certain taxable goods or services.
Employer Taxes: If you have employees in Missouri, you will have to register for the Unemployment Insurance Tax, and the Employee Withholding Tax through the Missouri Department of Labor, Licensing, and Regulation.
Step 9: Open Your LLC Bank Account
In order to keep your business finances apart from your personal finances, it is advisable that you open a separate bank account for your Missouri LLC. It will indeed help you maintain your personal liability protection. A separate bank account helps maintain your liability protection and it also makes business accounting and taxes a lot easier.
The items needed to open an account in Missouri are your approved Articles of Organization, EIN Confirmation Letter from the IRS, and your driver’s license or passport. We also recommend calling the bank ahead of time to find out if additional documents are required.
Tips: Look for free business checking: Call a few banks in Missouri and take down notes for comparison. Some banks charge monthly maintenance fees for your LLC’s checking accounts, others don’t.
- Debit card: A debit card for your LLC will be issued when opening the account.
- Credit card: If you want to start building business credit for your Missouri LLC (or get travel and cashback rewards), you can get a credit card or two for your LLC. We recommend using creditcards.com to find a business credit card.
Step 10: Apply and Obtain Your Business Phone Number
Instead of using your home telephone number or your cell phone, you can purchase an affordable “virtual business number” specifically for your Missouri LLC. You can set this virtual business phone up to forward to your cell phone, go through voice prompts, or configure it any way you’d like.
You can check out Phone.com as they have the cheapest plans and their customer service is excellent. They offer local phone numbers as well as 1-800 toll-free numbers. You can easily setup call forwarding, pre-recorded prompts, and get voicemail messages forwarded to your email.
Getting a separate business phone number for your Missouri LLC is also a good idea in order to keep your actual number private from those pesky “public record” websites.
Step 11: File Your LLC Annual Report
Missouri requires an LLC to file an annual report with the Department of Assessment & Taxation. When it comes to filing in Missouri, you have two options and they are; File Online with the State of Missouri or File by Mail. You are expected to pay a fee of $300, payable to the Secretary of State (Nonrefundable)
It is important to point out that in Missouri, an LLC may face fines and even automatic dissolution when they miss one or more state filings. When this happens, LLC owners risk loss of limited liability protection. A quality registered agent service can help prevent this outcome by notifying you of upcoming filing deadlines and by submitting reports on your behalf.
Step 12: Hiring of Employees
Of course, registering an LLC means that you will need employees and in order to get it right as regard hiring employees, then you should ensure that you stay on the side of the law and here are some steps you should follow:
- Verify that new employees are able to work in the US
- Report employees as “new hires” to the State
- Provide workers’ compensation insurance for employees
- Withhold employee taxes
- Print compliance posters and place them in visible areas of your workspace
Lastly, ensure that you find out more information from the Missouri Department of Labor, Licensing, and Regulation website.
To do business in Missouri, all LLCs organized outside of the state (called foreign LLCs) must register with the Missouri Secretary of State. Foreign LLCs must appoint a registered agent for service of process physically located in Missouri.
To register, file an Application for Registration of a Foreign Limited Liability Company (LLC 4) with the Missouri Secretary of State. The application may be filed online or by mail. The filing fee is $50 for online filing, $105 for filing by mail.
The application must include a current certificate of good standing/existence from the secretary of state or other similar official in the LLC’s home state. It must be dated within 60 calendar days from the date of filing the application.
Please, note that the information in this article is provided only for general purpose and it is no way a legal advice. No lawyer – client relationship is established or should any such relationship be assumed. For legal advice, please consult with a professional lawyer.