How to Form an LLC in Montana in 7 Steps
Starting a limited liability company (LLC) in Montana involves naming the LLC, choosing a registered agent, filing articles of organization, applying for an EIN for tax purposes, and obtaining necessary business licenses and permits.
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Limited liability companies (LLCs) are a business structure that offer limited liability protection, pass-through taxation, and flexibility. This structure makes them a popular choice among small businesses. To learn how to start an LLC, follow the step-by-step guide below.
Steps to Form an LLC in Montana
Name Your LLC
The first step of LLC formation is to choose a unique and distinctive LLC name for your business. You will need this name to complete your articles of organization in the next step. You must also ensure that your name follows Montana’s naming rules under MCA §35-8-103.
According to the Montana Limited Liability Company Act, your LLC name must:
- Be distinctive: Your name must differ from other registered Montana business names.
- Contain an LLC designator: Your LLC name should include language that clarifies that your company is an LLC. You can have the full words “limited liability company” or “limited company” in your name. If you prefer, you may abbreviate the word “limited” to “ltd.” and “company” to “co.” Or eliminate the full words entirely and use the abbreviations “L.L.C,” “LLC,” “L.C.,” or “LC.”
As you might expect, your LLC name should not contain any language that indicates a different type of business structure, such as a corporation.
Search Your Business Name.
To determine whether your name is available in Montana, search for the business entity name on the Montana Secretary of State website. You must choose a new name if this search comes up with matches.
Next, you should search the internet to ensure another business isn’t using your name. To do this, type your LLC name into your favorite search engine and see if there are any matches.
Finally, it’s a good idea to ensure that no other businesses have trademarked your name. You can search the United States Patent and Trademark Office (USPTO) trademark database. This step will help you avoid getting into legal trouble for trademark infringement.
Once you are confident that your name is unique and not trademarked, you should check for domain name availability. You may not start a company website immediately, but it is still an excellent step. Having your domain name ready to go will make launching a website easier down the road.
Protect Your Business Name.
To protect your brand, consider trademarking your business name in Montana or with the USPTO. To file a registration of mark in Montana, complete the online registration and pay a $20 registration fee. You can also register the business name as a domain name, so only you have rights to that domain.
Reserve Your Business Name.
Also, if you are not ready to file the articles of organization but want to hold on to your name, you can reserve the name. File a reservation of name on the Secretary of State’s website and pay a $10 filing fee. Under MCA §35-8-104, the name may be reserved for 120 days.
Get a Registered Agent
Under Montana law, MCA §35-7-101, LLCs must have a registered agent. A registered agent is an entity or an individual that agrees to accept legal paperwork on behalf of your LLC. If someone sues your LLC, the service of process will go to your registered agent.
Your registered agent can be a person who is a Montana resident or a business entity that’s authorized to operate within the state. Your registered agent must have a physical address in Montana and be available there during standard business hours. You will need to list your registered agent in your articles of organization in step three below.
For many LLCs, choosing one member to act as the company’s registered agent makes sense. But if none of your LLC members are willing and able to take on this responsibility, you should consider a professional registered agent service. With a registered agent service, you pay a fee for the registered agent to accept legal papers on your LLC’s behalf.
File Your Articles of Organization
To officially create your Montana LLC, file Articles of Organization with the state of Montana. Articles of Organization form a legal document that establishes key identifying facts about your LLC. In this sense, it’s similar to a corporation’s articles of incorporation.
According to MCA §35-8-201, your articles of organization should contain the following:
- Your LLC’s name
- The LLC’s duration, if you have an end date in mind
- The principal office’s mailing address (a street address, not a P.O. box)
- The registered agent’s contact information
- Information about the LLC’s management style
- Names of members and managers
- The types of services you will offer (only if a professional LLC)
- If any of the members consent to be personally liable for business debt, a list of those members and their written consent
- Any other matters you and your LLC members choose to address
You can file your Montana articles of organization online at the Secretary of State website. The filing fee is $35.
Or you can kickstart your LLC formation with our trusted partner, LegalZoom. They will check if your business name is available and file your articles of organization for $0 plus state filing fees.
Draft an Operating Agreement
Although not required by law, you should create an LLC operating agreement to organize your company’s operations. An operating agreement is similar to corporate bylaws. You use it to form an internal contract among LLC members on critical organizational issues. You do not file this document with the state. In your Montana LLC operating agreement, you can address the following:
- Member rights and responsibilities
- Management style
- Voting rights
- Percentage ownership
- Buyout procedures
- Rules for adding and removing members
- Procedures for dissolving the company
- Any other agreements between you and your other LLC members
Even a single-member LLC should have an operating agreement. As the only owner of your LLC, you don’t have to worry about member agreements and disputes. But there are other reasons to create an operating agreement. An operating agreement shows that you treat your LLC as a legal entity separate from yourself. This separation helps to protect your limited liability status. Further, you may need to indicate an operating agreement when opening a business bank account or seeking investments. Professionals like lawyers and accountants may also ask to see an operating agreement before providing you with services.
Get an EIN
If you have more than one LLC member or hire employees, you will need an Employer Identification Number (EIN). An EIN is a unique number that the Internal Revenue Service (IRS) issues. The IRS uses your EIN as a tax identification number for your business. In this sense, an EIN is like a Social Security number for businesses. You may need your EIN when you open a business bank account, pay employees, or apply for a company credit card. Getting an EIN is quick and easy to do at the IRS website. You can file by fax, mail, or online, and there is no fee.
Set Up Business and Tax Accounts
You may need to register your business for tax accounts in Montana. For more information on Montana’s tax obligations, visit the Montana Department of Revenue website. Generally, if the LLC is a pass-through tax entity, it does not pay corporate tax. The members report LLC profits and losses on their individual state and federal tax returns. However, if the LLC opts for C corp status with the IRS, the LLC pays a state tax.
Additionally, your business may need local, state, or federal licenses. Check with your town, state, and federal government for special licenses or permits you need to run your business.
Check for Additional Federal or State Requirements
Check state and federal websites to determine if there are any specific rules for your business. For example, some LLCs may have to file a Beneficial Ownership Information Report (BOIR) with FinCEN. Under current law, LLCs created in the United States are “domestic reporting companies” and are exempt from the BOIR requirement.
However, laws may change, so stay up to date with state and federal requirements.
Business and Tax Requirements in Montana
When operating a business in Montana, you may need to pay business taxes, withholding and employment taxes, sales taxes, and any business license and permit fees. Check with state and local authorities to determine which business taxes apply to your LLC.
State Business Tax
Depending on your LLC’s tax designation, you have different tax treatments for Montana state taxes. For example, if you are a C corporation (taxed as a corporation) or S corporation (taxed as a sole-proprietorship).
If your LLC is taxed as a corporation, your LLC pays a 6.75% tax rate on the LLC’s net income. If you set up your LLC for pass-through taxation, the profits go on the members’ individual income tax returns. There is no state tax.
State Employer Tax
If you have employees, you must withhold Montana income tax from their paychecks. The state of Montana offers a guide to help you understand your withholding responsibilities. You can register for a Montana withholding account at the Department of Revenue.
You may also set up worker’s compensation and unemployment insurance accounts.
Sales and Use Taxes
Montana does not charge sales tax, so this is one less concern for business owners in the state. However, you may need to collect sales taxes if you sell products online to other states.
You should visit the Montana General Use Sales Tax page for additional information on sales tax issues associated with out-of-state vendors and online sales.
Business Licenses and Permits
You should visit the Montana Department of Revenue website to learn about your state licensing needs. You will find a rundown of state licenses with links to the associated agencies.
Your business could be subject to federal licensing requirements if you operate in specific industries. For a complete list of business activities that give rise to federal regulation, you should visit the Small Business Administration website.
You should view Montana.gov’s Small Business Licensing Information page for information on local business licenses.
Registration in Other States
If you want to operate your business in another state, contact the Secretary of State’s office in the new state to register as a foreign LLC. You may need to show proof of existence in Montana to the new state. The new state may call this a “certificate of good standing.” To do this, order a certificate of existence in Montana using the secretary of state’s portal.
Depending on your operations (i.e., planning to have employees in that state), you may also have to set up tax and employer accounts.
Annual Requirements in Montana
State law mandates that you file annual reports to maintain your LLC’s good standing. These reports are due every year before April 15th. Your first report will be due before April 15th in the calendar year after creating your LLC.
Your annual report will primarily consist of confirming the information you gave in your articles of organization and making changes where necessary. Go to the Montana Secretary of State website to complete your annual report. You will search for your LLC, review your information, make any changes, and pay the $20 filing fee. According to the Secretary of State, most LLCs file annual reports without any changes.
If this is the case for your business, you can file your report and pay your fee through an expedited portal. You don’t even need to log in.
FAQs About Montana LLC Formation
The initial fee for the filing of articles of organization is $35. That is the fee you pay for the first year of the LLC’s existence.
After the first year of your LLC, you pay a $20 fee each year when you file your annual report by April 15th. If you need to change your LLC’s articles of formation (for example, changing a registered agent), you file articles of amendment using Montana’s online business services portal. The cost for an amendment is $15.
Single-Member LLC. You can form a single-member LLC (SMLLC), an LLC owned by only one member. SMLLCs have the same formation and filling requirements as multi-member LLCs.
Multi-Member LLC. A multi-member LLC is when multiple people or "members" can own the LLC. The members name a person or a group of people as "manager-members" to operate the LLC.
Professional LLC. Montana allows licensed professionals to form a professional LLC (PLLC). The owners must hold a professional license issued by the state (for example, a doctor, lawyer, or accountant).
Series LLC. Montana is one of the states that offers series LLCs. A series LLC is separate LLCs grouped under one parent. Each LLC is an independent business entity, so a lawsuit against one LLC under the parent does not affect the other LLCs. For example, a landlord might have an umbrella LLC for property management and leasing, and each property is in an individual LLC.
Your articles of organization establish your LLC in Montana. You show the articles of organization to banks when opening a business account and to others as proof your LLC is legitimate. To get a copy of the articles of organization, go to the Montana Secretary of State’s webpage to request certified copies of business documents. Input your business name and pay a $10 fee.
When Montana issues a "certificate of existence," they certify your business registration complies with their laws and you are current with fee and filing requirements. Other states refer to the certificate of existence as a "certificate of good standing." You can order one online with the Montana Secretary of State’s online portal for a $5 fee.
A certificate of existence is necessary when registering as a foreign LLC in another state, attracting members, or getting a bank loan. It legitimizes your business.
Montana requires the following for a limited liability company:
- Acceptable business name for your LLC
- Registered agent
- Registered office (a physical street address in Montana)
- Filing the certificate of organization with member information
- The $35 filing fee
One of the primary reasons for starting an LLC is limited liability protection. With limited liability protection, LLC owners’ personal assets are not at risk for the company’s debts and lawsuits. If someone sues your LLC, the LLC shields your personal car, home, accounts, and other possessions from company liabilities. The exception is if you give written consent to be personally liable for business debts. Not all business structures offer protection from personal liability. For example, if you have a sole proprietorship, your personal property could be at risk for your business’s debts and lawsuits.
Another reason business owners choose LLCs is pass-through tax treatment. With pass-through taxation, LLCs pay taxes through their members’ personal income tax returns. Pass-through taxation is preferable to corporate tax treatment, resulting in double taxation. Double taxation occurs when corporations pay taxes on their profits and stockholders pay taxes on their dividends too.
LLCs are easier to operate than corporations. Corporations have more formal rules and record-keeping requirements than LLCs. Less paperwork makes LLCs an attractive choice to small business owners who would like to streamline their business operations.
Montana requires all LLCs to file an annual report and pay a $20 fee. To avoid late fees and legal hassles, you should mark your calendar to submit your report before April 15th every year. Under Montana law, the Secretary of State can dissolve your LLC if you are 140 days late filing your yearly report.
No. The articles of organization is the initial document to set up your LLC in Montana. You file the articles of organization with the Montana Secretary of State. An operating agreement details your business’s operations, outlining the management structure, profit and loss distribution, and members’ rights and duties. You do not have to file the operating agreement with the Secretary of State.
Yes. If you have a trade name or brand different from your registered Montana LLC name, you can file a trade name for your LLC with the Montana Secretary of State. A trade name is also a "DBA" or "doing business as." Montana calls it an assumed business name. First, check that the assumed business name is available on the secretary of state’s website. Then, complete the registration of assumed business name online. The registration fee is $20.
Depending on your business, you may need business licenses and permits. Check Montana’s Small Business Licensing Information page to determine what licenses apply to your business.
Yes. Montana has an online business services portal where you can file articles of organization for your LLC. The online filing fee is $35. You can also file your annual report, register a trademark, and get copies of certificates. Or, if you don’t want to set up an account with the Montana Secretary of State, you can use an online LLC formation service company to handle the filing for you.
The physical address is:
State Capitol, Room 260
1301 6th Avenue
Helena, MT 59620
The mailing address is:
Business Services
P.O. Box 202801
Helena, MT 59620-2801
Yes. Even though you can serve as your own LLC’s registered agent, some entrepreneurs recognize the benefits of using a registered agent service. The advantages are:
- They accept service of process at their address. Any lawsuits are not served at your business or in front of your customers.
- They keep your address private. If you operate from home but want to avoid advertising your home address, the agent’s address appears on the public record.
- They maintain the good standing of your LLC. Registered agents alert you to annual tax and filing deadlines so you don’t jeopardize your liability protection and pay costly penalties.
- They are available when you aren’t. A registered agent must receive service of process during regular business hours. You might not operate your business during those hours.
A domestic limited liability company in Montana is an LLC formed with the Montana Secretary of State. When the secretary of state accepts your articles of organization and issues a certificate, you have a domestic LLC.
If you want to do business in another state, you register in that state as a foreign LLC. The registration requirements generally apply in all states in that you:
- Search in the new state’s business records that your business name is available
- Complete an application as a foreign LLC in the new state
- Show proof of your LLC’s good standing in Montana with a certificate of existence
- Pay the state fee for the registration
- Register for business and tax accounts in the new state and comply with reporting requirements
If you started your LLC in another state or country, you must register it in Montana to legally do business here. Before registering your LLC, you will need to name a registered agent with an address in the state of Montana. Further, you should ensure that your LLC name is distinct from all other Montana business names. For more details on checking for name availability, see step one above.
If your foreign LLC’s business name is unavailable in Montana, you will operate under an assumed name. To do so legally, you must file a registration of assumed business name. The registration costs $20. People may refer to an assumed name as a trade name or a DBA ("doing business as") name. These terms refer to a company name different from your official LLC name.
Once you have a Montana registered agent and a unique Montana business name, you can register your foreign LLC. To register, you should submit a certificate of authority for foreign limited liability company to the Montana Secretary of State. There is a $70 state fee for this registration.
When you decide to close your LLC, you file a certificate of dissolution. There are a few steps to dissolving a Montana LLC:
- Follow any dissolution provisions in your LLC operating agreement
- Close business accounts and settle taxes
- File articles of dissolution, selecting the cancel, withdraw or terminate a business registration on the Montana Secretary of State’s website
- There is no fee for this filing
No. Not in Montana. An anonymous LLC does not disclose the LLC owners’ names in the articles of organization which is a public record. Only Delaware, Nevada, New Mexico, and Wyoming offer anonymous LLCs at this time. Therefore, a business owner may use professional registered agent services to keep their personal address off the formation documents.
Disclaimer: The information presented here does not constitute legal advice or representation. It is general and educational in nature, may not reflect all recent legal developments, and may not apply to your unique facts and circumstances. Consider consulting with a qualified business attorney if you have legal questions.
How to Start an LLC in Other U.S. States
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