Quick facts about forming a Montana LLC
| Item | Details |
|---|---|
| State filing fee | $35 (online only) |
| Each series (series LLCs only) | $50 |
| Processing time | Varies; 24-hour ($20) and 1-hour ($100) expedited processing is available |
| Annual report fee | Free if filed January 1 to April 15 (the state has waived the $20 fee through 2027); $35 after April 15 |
| Registered agent required | Yes, with a street address in Montana (no P.O. box) |
| State franchise tax | None for LLCs |
| Business license | No statewide general business license, but local requirements may apply |
| Managing authority | Montana Secretary of State, Business Services |
How to start an LLC in Montana in 5 simple steps
Are you thinking of starting your business in Montana? There are several benefits of forming a limited liability company, such as minimizing the risk of personal liability in the event that someone sues your business. In the text below, we’ll cover how to start an LLC in Montana, going over everything you’ll need to know to officialize your business. Once you’re set up, you may also qualify for Montana small business grants.
- Name your Montana LLC
- Choose a registered agent
- File articles of organization
- Create an operating agreement
- Apply for an EIN
Now let’s dive in and examine each and every step.
Step 1: Name your Montana LLC
Customers will know you by name, so it’s important to choose one you like and that best represents your brand when you start your new business. It should be easily distinguishable from the brand names of your competitors, because you run the risk of being sued for trademark infringement if your business name is too similar to a competitor’s. Additionally, your name needs to be recognizable enough that it stands out from the crowd and is easy to remember. You need to make sure the name you choose is available to use in the state, which can be done by a Montana business entity search on the Secretary of State’s website. If you want to operate under a different name, you’ll also need to register a Montana DBA (assumed business name).
While it’s possible to change your business name later on, this may be difficult and costly to do. This is especially true if you’ve already had a lot of branded items made, set up financial accounts in the company’s name, or filed legal forms with your business moniker. You should be prepared to choose a name at the beginning of your entrepreneurship that will remain with your company long-term. Your name or slogan also needs to do a good enough job of describing the products or services the company offers and what you’re bringing to the table that no one else is.
Step 2: Choose a registered agent
A Montana registered agent is a designated person who sends and receives legal paperwork on behalf of your LLC. The name of your registered agent (and, for a noncommercial agent, their Montana street address) must be included when you register a business.
Your registered agent can be an individual or a business. A noncommercial agent needs an actual street address in Montana (no P.O. box); a commercial agent is listed with the Secretary of State. Your registered agent should be reliably available at that address to accept legal papers and forward them to you.
The owner of a business can serve as the company’s registered agent. To do this, you only need to use your own name and home or office address rather than the name and address of another individual. While this may seem straightforward, acting as a registered agent is time-consuming and could be problematic for emerging business owners who are undergoing rapid expansion. If you don’t hire a registered agent, you can list yourself, as long as you have a Montana street address.
When you employ the services of a professional registered agent, you will put the address of their business on your articles of organization. Because this identifying information is advertised together with your company name so that anybody servicing your firm may reach you, having a registered agent who is someone other than yourself is likely to be more beneficial for you and your business.
This also protects your home address from becoming public information. It’s also helpful to hire a professional registered agent if you prefer to work unconventional hours. Your registered agent needs to be reliably available to accept legal papers, and this often doesn’t work for new owners.
Step 3: File articles of organization
The articles of organization are a legal document that contains information about how the business will be structured and how it will operate. The documents must be approved by the Montana Secretary of State in order for the LLC to be formally recognized as a legal entity. When you file articles of organization for your company, it establishes the business as a separate legal entity from the business’s owner and legally registers the organization as a limited liability company with the state.
Four types of LLCs are recognized in the state of Montana:
- Limited Liability Company
- Professional Limited Liability Company (PLLC)
- Series Limited Liability Company
- Professional Series Limited Liability Company
For organizations that employ licensed professionals like lawyers, physicians, and architects, the PLLC designation may be required. Series LLCs are available in Montana to allow new LLCs to branch out from one parent LLC.
State fees
The Montana LLC cost for filing the articles of organization in the state is $35. Once your LLC is registered in the state, you will need to file a Montana LLC annual report each year by April 15, starting the year after formation. The report is free if filed January 1 to April 15 (the state has waived the $20 fee through 2027); $35 after April 15. Depending on your city and industry, you may also pay local license fees.
Requirements
To complete the articles of organization, you must include the following information:
- The name of your business and the type of LLC it will be
- The name and contact information of your registered agent and the location of the registered office
- The mailing address of your principal office
- The term of your LLC
- The type of governing authority your LLC will have
- Whether any members will be personally liable for the LLC’s debts
How to file
File online through the Secretary of State’s Business Services portal at biz.sosmt.gov. Create a free user account, choose the LLC type and submit the articles. Montana accepts business filings online only.
Step 4: Create an operating agreement
Once you’ve filed your articles of organization with the Montana Secretary of State, it’s recommended to draft an operating agreement for your Montana LLC.
What Is an operating agreement, and do you need one?
An operating agreement serves as a sort of compass that helps you manage your company’s operations and fulfill the demands of your members. When all members agree to an operating agreement, it binds every member. The agreement can set out whether and how a member may leave.
If a dispute arises between two or more members of the LLC, you can refer to the operating agreement for clarification and guidance on how the matter ought to be handled in accordance with your company’s goals and objectives.
Here are some things you may want to add to your Montana LLC operating agreement:
- Who are the members of your LLC at this time?
- How much interest does each LLC member have in the business?
- How do LLC members distribute and absorb company profits and losses?
- How much money will each member of the LLC contribute to the business?
- What authority do LLC members have over one another, and what voting rights does each member have?
- How will you structure your company’s management?
- What role will each member of the LLC have in the company?
- What process must a member go through to exit the LLC?
- How will the LLC be dissolved if the members decide to close it?
- How can new members apply to the business for LLC membership?
- How and when will business meetings be conducted each year?
- How and when will votes be held among members of the company?
- What occurs when an LLC member dies, is severely injured, or otherwise becomes incapacitated?
- How can an LLC member liquidate their interests in the business?
Is an operating agreement required in Montana?
Montana doesn’t require an operating agreement, and you don’t file one with the state. Under MCA 35-8-109, members may enter into one, and it “need not be in writing,” so it can be written or oral. A written agreement is strongly recommended because it is much easier to prove, and many banks ask for one when you open a business account.
Without a properly established operating agreement, the default rules in Montana’s LLC Act determine how your business operates.
Step 5: Apply for an EIN
If your business currently has workers or will have them in the future, you need to apply for an Employer Identification Number, or EIN. You also need one if your LLC has more than one member or elects to be taxed as a corporation. Here’s what to know about getting an EIN for your Montana LLC.
An EIN is a business-specific version of a Social Security number. The Internal Revenue Service of the United States (IRS) uses the Employer Identification Number (EIN) to identify a particular business. This number is nine digits long and appears like so: XX-XXXXXXX.
A single-member LLC with no employees can usually use the owner’s Social Security number for federal income tax, but most banks ask for an EIN. You can apply online with the IRS for free.
Montana LLCs can benefit from an EIN in many different ways. For example, it ensures that your company’s taxes and financial records are kept completely separate from any personal money you have. This is important, even for individuals operating a sole proprietorship.
FAQ
It costs $35 to file your Articles of Organization with the Montana Secretary of State.
Montana accepts business filings online only. Processing times vary, and 24-hour ($20) and 1-hour ($100) expedited processing is available.
Yes, every Montana LLC must designate a registered agent with a street address in the state. You can be your own registered agent or use a registered agent service.
Montana does not require an operating agreement, but creating one is recommended to clarify management and ownership roles. It can be written or oral and isn’t filed with the state, though a written agreement is easier to prove.
Yes, all Montana LLCs must file an annual report by April 15 each year, starting the year after formation. It’s free if filed January 1 to April 15 (the state has waived the $20 fee through 2027); $35 after April 15.
Montana does not impose a franchise tax on LLCs.
Montana has no statewide business license requirement, but some local governments and specific industries require permits or registrations.
