How to Form an LLC in Montana

Co-authored by Clinton M. Sandvick, JD, PhD

Last Updated: January 31, 2023 References

Whether you are starting a new business or expanding an old one, you need to think about organizing it to protect you against legal liability and make it efficient for tax purposes. A limited liability company is often a good choice. An LLC is less complicated and expensive to organize and manage than a corporation and offers you more protection than a traditional partnership. Montana has a simplified and straight-forward LLC registration process. With some upfront planning, you will not need a lawyer to creation your LLC.

Part 1

Part 1 of 3:

Planning Your Limited Liability Company

1
Consult with a tax professional to decide if an LLC is right for your company. A limited liability company, commonly called an LLC, is a legal business structure that allows you and your partners to shield your personal assets in the event your business is sued for debt or other legal liability.^{[1]
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Research source} An LLC is a hybrid of a partnership and a corporation.
- Forming an LLC will add complexity to your business structure, your tax filings, and reporting requirements. Unless you have financial skills, factor the extra expense of professional assistance into your business budget.
2
Name your business. The Montana statutes require that business names registered with the Secretary of State be distinguishable from other businesses in the state to minimize confusion.
- Before you begin, perform an online search of your potential business name and "Montana." By looking at business listings and websites, you can review not only your potential competition, but also other businesses with similar names. The name idea you thought was clever and original may not be.
- Montana doesn't recognize plurals or adding special characters such as "&" as making your business name distinguishable. Take the time to make your business name catchy and unique.
- Run your proposed name through the Montana Business Entity Search.^{[2]
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  Research source} If the name, or a plural of the name, is already in use, it will not be approved by the state when you file your LLC.
- Your legal business name must include either "LLC" or "Limited Liability Company." Neither is preferred or superior. You can use whichever suits your vision for the branding of your company.
3
Identify the LLC members. The owners or partners of an LLC are called members. Before you create your LLC with the state, you must choose who will be a member in the company and what percentage of the company each owns.^{[3]
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- Each LLC member will be required to comply with tax filing and reporting requirements. Do not add anyone, such as a family member, as a ceremonial member of your company.
- Montana law allows for the formation of a single member LLC. Because of this, you are not required to have partners.^{[4]
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This is the person and address that is the company's legal representative. The agent will be responsible for receiving all legal documents, including service of lawsuits, subpoenas, and other documents from the state or the court. Your agent can be a member of the LLC, a lawyer, or anyone that you trust to receive and handle confidential documents. The address of the registered agent will be part of the public record.^{[5]
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The EIN is issued by the Internal Revenue Service and will be used to identify your LLC whether you have employees or not. Using an EIN lets you keep your Social Security number private and off the public records. Also, with an EIN, if your business expands to the point that you are ready to take on employees, you are ready to do your tax filings. There is no charge to file for an EIN and it can be done electronically or by mail.^{[6]
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Part 2

Part 2 of 3:

Creating Your Montana LLC

1
Complete the Articles of Organization. This is a document that identifies the company name, address, members, type of business, and the Registered Agent. Montana provides a fill-in-the-blank Articles of Organization. Everything in the state-supplied Articles will be public record. This document is separate from any partnership or ownership agreements you may have with the other members.
- It is not required that the Articles by typed. However, it should be printed in dark ink. Illegible forms may be denied and your fee forfeited.
- It must be signed by the managing member of the LLC.
2
Submit the completed application and fee. Mail your original application and one copy to the Montana Secretary of State using the address listed on the form. You must also include the appropriate fee. Do not send cash. Make checks or money orders payable to the Secretary of State.
- The normal fee is $70. Under the normal filing process, your application will be processed within 10 working days.
- You add $20 and mark the priority handling box to have your application processed in 24 hours. The total fee would be $90.
- Montana offers a 1-hour process service for a $100 surcharge. The total would be $170.
- Priority processing is only available during normal business hours. If your application is returned to your for being illegible or incomplete, you will lose the expedited handling fee.
Depending on the processing time you chose, you will receive a file-stamped copy of your approved LLC papers in the mail. You will also be able to find your new business listed in the Secretary of State Business Entity database. At this time, you can legally start using your new business name.^{[7]
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Part 3

Part 3 of 3:

Operating your Montana LLC

Your limited liability company must file an annual report with the Montana Secretary of State each year by April 15th. Failure to file an annual report can result in dissolution of your LLC by the state. You can file online or download a hard copy and file by mail. There is a $15 annual filing fee.^{[8]
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If you move your LLC, change members, or change any of the information included in your original Articles of Organization, you must file Articles of Amendment. There is a $15 fee to file and amendment. If you make several changes, you can file all of your changes in one Articles of Amendment.
Each member of the LLC claims his share of the profits or wages paid through the company on his individual taxes. As a hybrid business entity, your LLC can elect to be taxed as a partnership or as a corporation. You should consult with a tax professional to determine which filing status would benefit you best.^{[9]
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Internal Revenue Service
U.S. government agency in charge of managing the Federal Tax Code

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If you decide to go out of business, you have to dissolve your LLC with the Secretary of State. To end the annual reporting requirement and tax requirements, you must file Articles of Termination. There is a fee of $15 for normal processing of 10-business days. To expedite the termination, you can pay and additional $20 for 24-hour processing or an additional $100 for 1-hour handling.

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