If you’re starting a new business, there are a variety of important tasks in front of you. One of the most vital, however, is choosing a business structure, and forming the business entity. If you’ve chosen to use an LLC, you’re in good company – many entrepreneurs prefer limited liability companies due to their combination of ease of use and liability protections.
In Missouri, the LLC formation process is handled by the Secretary of State department. If you’re looking to start an LLC in Missouri, this guide is for you.
The main step you’ll need to take is to file the Articles of Organization with the Missouri Secretary of State. However, there’s a lot more to it than just that. Below, find a step-by-step guide on how to start a limited liability company in Missouri.
1. Consider utilizing an LLC formation service
If you want to save time and hassle, the best way to start a new Missouri LLC is to use a professional LLC formation service. These companies specialize in forming new business entities, and they can greatly speed up (and simplify) the formation process.
Two popular, affordable options are Northwest Registered Agent and ZenBusiness. Either of these companies would be a great choice – but to generalize, ZenBusiness is a bit cheaper (starting at $49), while Northwest is known for excellent, personalized service.
If you use a professional service, they will walk you through each step of the process – so you don’t really need to read the rest of this guide. If you choose to do the work on your own, the steps below will guide you through the requirements to start a Missouri LLC.
Check out our roundup of the Best LLC Services
2. Name your new company
Selecting a name is a very important step in your business journey. You will want to select a name that is unique, memorable, and relevant to your business. And of course, you will need to find a name that is not already taken by another business in Missouri. The Business Entity Search from the Missouri Secretary of State can help you confirm whether or not a name is available.
In addition to being not in use by another business, your LLC name also needs to meet a few other requirements. It must contain “LLC”, “L.L.C.”, or “Limited Liability Company” within the name. And it cannot contain certain words, like profanities, government-related terms, etc. Lastly, certain words are protected and require additional paperwork. This includes terms like “bank”, “university”, “doctor”, etc.
Once you find a name that you like, you can move onto the next step. Alternatively, you can reserve the name ($25 fee) if you’re not quite ready to file, but you want to reserve the name you have found.
Using a Fictitious Name in Missouri
It is worth noting that businesses in MO can use what is called a Fictitious Name, in addition to their actual LLC name. This is basically a secondary name, used for branding purposes, that is “attached” to the primary LLC name.
This is quite useful, as it allows for a business to legally operate under a different name. The fictitious name must be registered, however, it’s not like registering a new business entity – it’s simply adding an additional name to your business. Learn more here.
3. Appoint a Registered Agent
A registered agent is an individual, or a business, that represents your LLC and receives important legal documents on behalf of the company. This could include tax notices, a notice of lawsuits, and other important mailings.
Each Missouri LLC is required to appoint a Registered Agent for the business. The agent’s physical mailing address (no PO boxes allowed) must be included on the business’ public record, so that parties wishing to contact the business may find the appropriate mailing address. This also means that if you are your own agent, you may have to list your home address publicly.
Anyone who is a resident of Missouri can be a Registered Agent for your company. This could be yourself, or an employee of yours. Alternatively, there are professional Registered Agent services available, which can serve as your agent for a flat yearly fee (usually $100-$150/year). Some good options include Northwest Registered Agent and ZenBusiness.
Check out our roundup of the Best Registered Agent Services
4. File LLC Articles of Organization
The Missouri LLC Articles of Organization will need to be filed with the Secretary of State in order to form your LLC as a business entity. This is the main set of paperwork that establishes new LLCs. It can be filed online, or through the mail. However, the fee is substantially higher for mail applications ($105) compared to online applications ($50).
To file online – Register a new account with the Secretary of State, and follow the instructions to file the Articles of Organization. Pay the $50 filing fee via credit card or bank transfer.
To file by mail – Fill out this form, and mail it along with a check for $105 payable to the Secretary of State. Mail the application to:
James C. Kirkpatrick State Information Center
P.O. Box 778
Jefferson City, MO 65102
Once the document has been submitted, you will simply need to wait for it to be processed. Online applications are typically processed faster, while mail applications up to a week or two.
5. Create an operating agreement
Note: This step is optional, but recommended.
An operating agreement is a legal document that most LLCs should keep on file. It establishes operating procedures for the business, as well as laying out the ownership structure. However, it’s not required to submit anywhere, so this is an optional (but recommended) step.
An operating agreement is especially important if your company has multiple owners. It can be used to agree on an ownership structure in a formal way, which reduces the chances of future conflict and disputes.
Services like ZenBusiness can help you draft an operating agreement, as can a local business attorney.
6. Apply for business licenses & permits
Once your LLC is formed, you may need to apply for certain other permits and/or licenses. This can include business licenses, specialty permits, and local permits.
You will need to register for tax receipts with the Missouri Department of Revenue. You will also need to set up unemployment tax accounts with the Missouri Department of Labor and Industrial Relations. And certain businesses in professional services may need to acquire professional licenses from the state of MO. More information can be found here.
Federal licenses and permits may also be necessary, but only for certain industries.
Finally, you may need local permits in the city or county that you plan to operate in. Many counties require a local business license, and most have a permit for certain activities – for example, restaurants will need county health licenses, liquor licenses, etc.
The specifics will vary depending on the business, but the real lesson is this: Simply forming an LLC is just the first step – you will also need to ensure that you are complying with all other requirements for your new business on the state, federal and local levels.
7. Apply for an EIN
You can apply for an EIN with the IRS here. The EIN is a tax ID number (Employer Identification Number) that is used to hire employees, open business banking accounts, and more. Once obtained, it will be the primary number you use for tax filings with the federal government.
An EIN is required to hire employees. It is a federal number, so it has little to do with Missouri – but most Missouri LLCs should still obtain one. Fortunately, there is no cost to apply for one, and it’s generally a simple process once your business entity is formed.
8. Open a business checking account
For accounting and liability purposes, it is very important to keep your personal and business finances as separate as possible. To do this, you should open a new, dedicated bank account specifically for business purposes, and use this exclusively for business transactions.
To open an account, you will typically need a business license, formation documents, and a small opening deposit. Most banks also require an EIN (see above). Most financial institutions offer business checking accounts, but you’ll want to call ahead to see what specific requirements they may have.
At this time, you may also wish to apply for credit for your business. This could be a line of credit through the bank, or a business credit card. This is also a good time to look into business insurance – your business’ bank may even offer it directly.
9. Keep your business in good standing
Finally, there are many ongoing tasks that you will need to handle in order to keep your business compliant with all requirements on a federal, state, and local level. This includes filing various tax returns and annual reports, renewing permits, and more.
It’s difficult to list every requirement for your business here, simply because the requirements vary substantially depending on the industry you operate in and the area(s) you do business in. That said, here are some of the most common requirements that your business may face:
- Missouri Employer Taxes (payroll tax)
- Missouri annual reports
- Missouri state taxes
- Missouri sales taxes
- Federal business taxes and income taxes
- Federal employer taxes (FICA)
- Federal quarterly taxes
- Business permit renewals
- Business license renewals (local level)
- Local city/county tax returns
- Specialty permit renewals
- And more
This can seem like a lot to handle at first, but you will get the hang of it after the first year or so. It’s best to sit down now, while your business is brand new, and research all the requirements for your specific business. Then, make a checklist of initial tasks, as well as a list of ongoing tasks (with due dates) that you will need to stay on top of. You can also add key due dates to your calendar so that nothing slips through the cracks.
Businesses like Northwest Registered Agent and ZenBusiness can also help you stay compliant with ongoing requirements. They can help directly with certain filings, and remind you of other due dates. This is another reason it’s recommended to use a professional service if you prefer a bit more of a hands-off approach.