Forming an LLC in Missouri
A limited liability company (LLC) is a popular legal structure for small businesses. This business structure provides business owners with liability protection and potential tax advantages. One of the main reasons to form an LLC is to protect your personal assets from business liabilities.
LLC formation is easy in Missouri. Just follow along with the six steps in the step-by-step process below to learn how to start an LLC.
Steps to Form an LLC in Missouri
Name Your LLC
You should pick a business name that is unique and that makes your business stand out from the competition. Your Missouri LLC name must be available and must follow the state's naming rules.
Make sure your name is available by doing a business name search on the Missouri Secretary of State Corporations Division website. If there are no matches, you should continue searching for availability by doing an internet screening search. Simply type your desired company name into your favorite search engine to see if there are results.
Also be sure to follow Missouri's naming rules. According to the Missouri Limited Liability Companies Act, your name must contain language to indicate that your company is an LLC. To accomplish this, your name must contain one of the following: limited liability company, limited company, or an abbreviation. Acceptable abbreviations are LC, L.C., LLC, or L.L.C.
Your LLC business name must not include any language that could confuse it with a different type of business entity. So, the LLC name may not include any of the following words: corporation, incorporated, limited liability limited partnership, limited liability partnership, ltd, or any abbreviation of those. Further, your name may not include any language that could confuse your business with a government agency.
If you want to reserve your LLC name before you form your LLC, you can do so by filing a reservation with the Secretary of State online. The filing fee is $25. This reserves your name for 60 days. You can file for two extensions, if necessary.
Get a Registered Agent
A registered agent accepts service of process for your LLC. In the event that someone files a lawsuit against your Missouri business, the official documents will go to your registered agent.
Your Missouri registered agent must have a physical street address within the state. They must be available during standard business hours too. A P.O. Box may be listed as a registered office address only if a physical street address in the same city is also listed.
You can be your own registered agent, or you can hire a registered agent service. Using a registered agent service can help business owners maintain privacy and ensure compliance with state requirements by reducing the risk of missing important notices and deadlines.
File Your Articles of Organization
Your LLC is formed by filing articles of organization with the Missouri Secretary of State Corporations Division. Articles of organization form a legal document that contains basic information about your LLC. This document lays out the structure and identifying qualities of your LLC. Under Missouri law, you must include the following information about your business entity when you file articles of organization and start an LLC:
- The name of your LLC
- Your LLC's purpose
- A statement about whether your LLC is member-managed or manager-managed
- The physical address of your registered office and registered agent
- The events that would cause your LLC to dissolve, or the duration of your LLC
You can file this paperwork with the Missouri secretary of state online or by mail. If you choose online filing through the business portal, you will need to click “create an account" and follow the prompts. The state fee for filing Missouri articles of organization is $105 for paper filing and $50 for filing online.
Draft an Operating Agreement
An LLC operating agreement is an internal company document that has a similar purpose to corporate bylaws. Under Missouri law, you must have an operating agreement for your LLC.
You can use this document to form agreements among your LLC members on issues like:
- LLC management
- Members' rights and responsibilities
- Profit-sharing arrangements
- Voting procedures
- Tax elections
Your operating agreement can also address any other important company issues. Missouri statutes make it clear that LLC members have the right to negotiate this contract and to form it in the manner that best suits the business.
After forming your operating agreement, you should store it along with your other business records. You do not need to file it with the state.
Get an EIN
Unless you have a single-member LLC with no employees, you will probably need to apply for a federal employer identification number (EIN). An EIN is a unique number that the Internal Revenue Service (IRS) uses to identify companies for tax purposes. You can think of your employer identification number as a Social Security number for your business. Getting an EIN is simple to do on the IRS website. To learn about your federal tax obligations, you can visit the IRS's page on tax information for businesses.
You will need an EIN to:
- Open a business bank account
- Get a business credit card
- Hire employees
- Apply for licenses
- File taxes
Set Up Business and Tax Accounts
Your tax and regulatory requirements will vary depending on your location and the nature of your business. To register for state business taxes, you can visit the Missouri Department of Revenue. Depending on the type of business you operate, you may need to pay sales taxes, franchise taxes, unemployment taxes, or other state taxes. Check to see if your LLC is required to register with the Missouri Division of Employment Security for unemployment tax purposes. Also, your LLC may have to carry worker's compensation coverage through the Missouri Division of Workers Compensation.
To find out whether you need local business licenses, you should check with your city and county officials. If you think you may need a federal license, you can visit the Small Business Administration (SBA) website. The SBA's website provides a list of business activities that would require a federal license.
Depending on the type of business, your LLC may be subject to different Missouri state taxes.
State Business Tax
You can visit The Missouri Department of Revenue and the Department of Labor and Industrial Relations, Division of Employment Security website to register your LLC online. Your LLC's tax number should be issued within 10 business days.
State Employer Tax
If your LLC has employees and makes payment of wages to a resident or nonresident individual, you must obtain a Missouri Employer Tax Identification Number and pay the state employer withholding tax. Withholding is the tax that an employer deducts and withholds from employees' wages every pay period.
Sales and Use Taxes
Sales tax is applicable on all retail sales made from a location within the state of Missouri. Vendor's use tax is applicable on all sales made by out-of-state vendors where goods are shipped into Missouri and where title passes within the state of Missouri. Any person or company that has a business location in Missouri from which they sell or lease goods or provide a taxable service to a final consumer is required by law to collect and remit Missouri sales tax.
Business Licenses and Permits
LLCs operating in the state of Missouri may be required to obtain local licenses or permits. The application process, requirements, and laws are subject to change according to the local authority of each city. Based on the type of business your LLC conducts, it may be subject to one of the following categories of business licensing and permits:
- Professional licenses
- Agricultural licenses
- Environmental permits, certifications, or registrations
You should check with the city or county where your business is located to learn more about local business requirements.
Registration in Other States
If you want to do business in another state, you will likely have to apply to register as a foreign LLC. You may need to show a certificate of good standing as part of the application process or otherwise prove your LLC's compliance in its home state.
Missouri is one of the few states that do not require LLCs to file an annual report or pay an annual fee to the Secretary of State. If you need to make changes to your LLC, you can do so by filing an amendment of articles of organization with the Secretary of State and paying the $25 filing fee.