Are you considering forming an LLC for your business in Missouri?
Setting up a Limited Liability Company for your business is a great way to protect yourself while making money doing what you love. Although getting started can feel intimidating, it doesn't have to be complicated. All you need is the correct information, and your LLC will be up and running in no time!
By the end of this guide, you will know:
- The steps you must take to start an LLC in Missouri
- What other important tasks you need to complete after setting up your LLC
- How much it will cost and what rules you need to follow
If you are thinking about starting an LLC in Missouri but aren't sure where to begin, keep reading!
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Step 1: Name Your Missouri LLC
The first step when forming an LLC in Missouri is naming your business.
Missouri law creates rules for what you can call your LLC. For example, your LLC name must include certain words. Тhere are also certain words that you can’t use.
You must obey all of these rules when you choose a name for your business. If you break them, you will not be allowed to register your chosen name.
Words You Have to Use
Missouri Revised Statutes Section 347.020 requires that LLC names include an indication that they are LLCs.
This means that every LLC in Missouri must use one of the following words or abbreviations in its name:
- “limited company”
- “limited liability company”
Words You Can’t Use
Section 347.020 also lists some words that can’t be included in your LLC’s name:
- “limited partnership”
- “limited liability partnership”
- “limited liability limited partnership”
You also can’t use other words or phrases that make it seem like your LLC is a different type of business entity or a government agency. If you list a specific purpose for your business when you register it, your name can’t imply that you do something else.
Some words can only be used in your LLC name if you have a specific license or you conduct a certain type of business. For example, Missouri Revised Code Section 362.425 limits the use of the terms “bank” and “trust company.”
The big rule is this: if you need a license to do your job, you should double-check with the Secretary of State to make sure your company name complies with the law.
The name you pick as your LLC name must also be different, or “distinguishable,” from every other name registered with the Secretary of State. This rule keeps people from mistaking one business for another.
Research the LLC Name You Want
You can search the Missouri Secretary of State's business name database to determine if the name you want is available.
If your desired name has already been registered, there are two situations where you can still use the name:
- If the other business agrees in writing that you can use the name and changes its name.
- If you get a court order that says you had a right to use the name before the other business registered it.
If the name you want is available, you can reserve it for 60 days and renew your reservation twice. This means you can keep the name from being registered to someone else for up to 180 days.
To reserve your LLC name, you must submit an Application for Reservation of Name (Form BE1) and a $25 filing fee to the Missouri Secretary of State.
To ensure your application is processed as soon as possible, you should file it through the Secretary of State’s online portal. Alternatively, you can also submit the application form through the mail.
Get a Matching Domain
Once you settle on an LLC name, we recommend you get a matching domain, even if you don’t have immediate plans for a website.
Competitors can buy your perfect domain and its variations to block you from using them.
Domain squatters sift through public records of newly registered LLCs and will buy their matching URLs, only to relist them with huge markups.
A domain name from GoDaddy.com or a similar registrar will cost you between $20 and $50 per year, with regular specials and sales where you can get large discounts.
It pays to check now.
Once you have your domain name, you can also create a branded email address through GoDaddy.
Missouri DBA: Using a Fictitious Business Name
An important thing to remember when naming your LLC is that you don’t have to use its official name to do business. Many business owners choose to use a DBA (“doing business as”) instead.
A DBA is a name that you use to carry out your business. It’s what will go on your business cards, marketing materials, and website. By filing a DBA, you can run your LLC using a different name than its legal name.
In Missouri, a DBA is known as a “fictitious name.” Under Missouri Revised Statutes Section 417.200, any LLC that uses a DBA must register the name. To do this, you must submit a Registration of Fictitious Name (Form Corp. 56) to the Secretary of State.
LLC owners regularly use DBAs when running their businesses. One reason is that you don’t have to use the words “limited liability company” or an approved abbreviation in your fictitious name.
Another benefit of a DBA is that you can rebrand your business without creating a new LLC. If your business grows, you can change the name your LCC goes by to be more accurate.
If your LLC had a legal name of “Carla’s Candy Shop, LLC,” you could use “Carla’s Candy Shop” as a DBA.
But imagine that, as your business evolves, you start to sell other deserts as well as candy. In this case, you could register a DBA of “Carla’s Sweet Shop” so potential customers know you offer more than just candy.
Step 2: Appoint a Registered Agent for your LLC
A “registered agent” is a person or a business that receives legal papers and other important documents for an LLC.
Missouri Revised Statutes Section 347.030 says that all LLCs must have a registered agent to accept service of process for the business. Accepting service of process is a legal term that means receiving the official court documents that are sent when you are sued. So, if your LLC is involved in a lawsuit, your Missouri registered agent will get the papers.
Your LLC’s registered agent must have an office in Missouri. They must also be available to accept papers during business hours.
Missouri allows any person or business with an office in the state to be your LLC’s registered agent. Many new business owners think that serving as the agent for their own LLC is a good way to save money. However, this is usually not the best option.
Seasoned business owners often use a professional registered agent company. This type of business will allow you to name it as your registered agent and use its address for service of process.
You might not be certain that paying a business is the best choice. Naming yourself as your LLC’s agent can seem like a good idea for a few reasons:
- It’s cheap: You’re not paying someone else to do it for you.
- It’s easy: The only address and contact information you have to keep current is your own.
- It’s reliable: You will receive all important documents personally.
However, we suggest that you don't serve as your Missouri LLC’s registered agent. There are several reasons for this:
- No privacy: Your name and address will be published on the Secretary of State’s website. This means that anyone with an internet connection can find this personal information.
- Junk mail/spam: You will get a ton of junk mail in addition to a small amount of real mail and any service of process.
- No breaks: You also must be available at all times during regular business hours to receive documents. This means no vacations, sick days, or leaving the office for lunch.
- Business interruptions: Client meetings can be interrupted by people serving process. That could be embarrassing or hurt your reputation.
- It’s your fault if you miss something: You always have to make sure your address is correct and up to date. If you make a mistake or miss something, you are held responsible.
Using a third-party registered agent service is a better choice than doing it yourself. A registered agent service usually costs around $100 per year. Plus, they will let you know within minutes if any documents are received.
If you are looking for a professional registered agent service, take a look at our Best Registered Agent ranking for some of our recommendations.
Using a professional registered agent service is a good idea if you plan to do business outside your home state. You will need to register as a foreign LLC and maintain a registered agent in each of the other states. With a professional service, one business can handle all of the registered agent duties for your LLC.
Step 3: File Your Missouri LLC Articles of Organization
Articles of organization are the legal documents that create LLCs. They provide basic info about new businesses and must be filed with the Missouri Secretary of State. You must file articles of organization to form an LLC.
If you would like to avoid the hassle of handling your LLC filing yourself, you can also use a professional LLC formation service. Check out our Best LLC formation services article for some of our suggestions.
What to include in my Missouri Articles of Organization?
You must file an Articles of Organization form (Form LLC 1) to create a Missouri LLC.
Missouri Revised Statutes Section 347.039 says you must list:
- The LLC’s name
- The LLC’s purpose
- The registered agent’s name and address
- Whether the LLC will use non-member managers
- The period of the LLC’s existence
- The filer’s name and address
The purpose listed in the articles can be specific, but most LLCs list their purpose as “the transaction of any or all lawful business.” The period of the LLC’s existence can be any number of years. It can also be “perpetual,” which means it will exist until it is dissolved.
You can file your LLC’s articles of organization online or by mail. We always recommend using online filing for faster processing. The Secretary of State’s step-by-step guide to Registering a Limited Liability Company (LLC) can walk you through the online filing process.
Missouri LLC Filing Fee
In Missouri, the filing fee for articles of organization is $50 if you file online and $105 for paper filings. If you file online, you must use a credit card and pay a $1.25 convenience fee.
Missouri LLC Processing Time
If you file your articles of organization online, they will be processed and approved immediately. However, when you file by mail, the processing time ranges from 6 to 8 weeks.
Step 4: Draft your Missouri LLC Operating Agreement
An operating agreement is essentially a list of rules for your LLC. It is a legal contract that outlines how your LLC will be structured. It also explains each member’s rights, powers, and duties.
Missouri Revised Statutes Section 347.081 says that all Missouri LLCs need to have an operating agreement. However, operating agreements do not need to be filed with the Secretary of State.
An operating agreement makes sure that every member of the LLC understands how you will run your business. This can prevent future arguments.
For example, if a member wants to leave the LLC, your operating agreement will govern what happens next. It should outline a plan for buying out their interest in the business and reassigning their duties.
Operating agreements can cover many different situations. For example:
- They determine the rights and duties of LLC members. If one LLC member is responsible for running the business or managing the books, the operating agreement should say so.
- They say what the manager has the right to do. Managers also have special duties to the company and the members. The operating agreement should state these.
- They outline what the LLC is legally able to do. The operating agreement should also set down how the company is allowed to conduct its business from day to day.
- They say how new members can join the company. They also have rules about how exiting members can leave.
- They set down how and when profits are paid to members. They can also create different types of membership and payment schemes.
- They say whether members or managers are in charge. They also say how to hire and fire managers.
- They say how and under what circumstances the LLC should end. You might not want to dissolve your business now, but you might in the future. It’s best to think about it and plan before it becomes an issue.
- They say how to change the rules. You may need to amend your operating agreement in the future. The operating agreement should set down the rules for making changes.
An operating agreement is important because it sets standards for your business going forward. Every member should help create the contract. You should also read it carefully before you sign and keep a copy for your files.
Step 5: Get an EIN (Employer Identification Number) for Your Missouri LLC
An Employer Identification Number (EIN) is a nine-digit identification number that the IRS assigns to businesses. You can think of your EIN like it's a social security number for your LLC. You will use it to file federal taxes and carry out other business with the government.
Here are the most common times when you need an EIN:
- Does your LLC have more than one member?
- Does your LLC have any employees?
- Is your LLC taxed as a C corporation or S corporation?
Single-member LLCs don’t need to use an EIN; you can just file your taxes using your SSN. However, an EIN can protect against identity theft and help separate your business expenses from your personal finances.
Most banks will also ask you to get an EIN if you want to open a business account.
It’s easiest to apply for an EIN on the IRS website. You can also apply through the mail by filing IRS form SS-4. However, we recommend submitting an online application because you will get an EIN instantly with this method.
It only takes a few minutes to get an EIN, so you should never hire a business to do it for you.
First Tasks After Registering your Missouri LLC
After you have registered your Missouri LLC, you’ll need to tackle some other important tasks. Taking these steps will ensure that you follow the law and best business practices while running your business.
Open a Business Bank Account
You are not required to open a bank account for your LLC. Still, maintaining a business account for your LLC will make it much easier to keep your finances organized. It will also preserve the personal asset protection that is one of the primary benefits of forming an LLC.
There are several advantages to opening a business bank account for your LLC:
- Convenience: Keeping things separate makes your LLC’s bookkeeping much simpler.
- More business opportunities: Your LLC can only receive credit card payments through a business account. You can also do business with people who won't take personal payments.
- Personal asset protection: Mixing your personal and business funds could cause you to be held responsible for the LLC's debts.
The final point, asset protection, is critical.
One of the primary reasons for using a business structure like an LLC is to avoid personal liability for business debts. If your LLC is sued, only business assets will be at risk. Your personal assets can’t be accessed for the LLC’s liabilities. This concept that you and your LLC are separate is called the “corporate veil.”
If you don’t keep your business and personal assets separated, the corporate veil can be “pierced.” When you use the LLC’s assets as if they belonged to you, the law says your personal assets are no longer protected. This means that your personal property can be taken to pay business debts.
Opening a business bank account is essential for keeping the corporate veil from being pierced and protecting your personal finances.
Get Business Insurance For Your Missouri LLC
Once you start an LLC, it’s important to get insurance for your business. You should consider the risks involved in your industry and get the insurance coverage you need to protect yourself.
Some policies you should consider:
- General liability insurance: You’ll need this if there's an injury on your property. It pays for damages and a lawyer if you need one.
- Commercial automobile insurance: This works like your own car insurance. It covers drivers and vehicles for your business.
- Workers compensation insurance: Missouri Revised Statutes Section 287.030 says that LLCs with five or more employees must get a workers’ compensation policy. If you run a construction business, you must have workers’ compensation if you have one or more.
- Commercial property insurance: This protects your property in the event of damage. Keep in mind that flood insurance is often a separate policy.
- Professional liability insurance: Lawyers, doctors, architects, and other professionals need this insurance. It provides coverage and legal defense in the event of a malpractice case.
- Business income insurance: If you have to close for some time, business income insurance can pay back the loss of income. Policies vary, though. Make sure that you know exactly what kinds of losses will be covered.
Keep Your Missouri Company Compliant
There are rules you must obey when running your LLC. For example, you may need to obtain a business permit or license or pay taxes. Following the law is an important part of running a successful business. Make sure you stay informed about any changes to the laws that apply to your business.
Missouri Business Permits and Licenses
Your LLC might need a business license or permit. It depends on what kind of business you are running and where it operates.
You can use the Registering My Business page on the Missouri Business Portal to learn more about the rules in Missouri. You should also check the website for the city where you will operate to see if you need a local license.
Missouri Tax Requirements
If you plan to sell goods or hire employees through your LLC, you will have to register with the Missouri Department of Revenue (DOR). You can use the DOR’s website to register your LLC to pay various types of taxes.
LLCs with employees must also pay employer payroll taxes and withhold taxes from employee paychecks. You’ll also likely need to pay unemployment insurance taxes through the Missouri Division of Employment Security (DES).
Federal LLC Tax Filing Requirements
For federal tax purposes, your Missouri LLC is considered a “pass-through entity.” This means that profits and losses from your LLC should be reported on Schedule C of your personal tax return.
You also are required to pay federal Social Security and Medicare taxes, even if you don't have employees. If your LLC does have employees, you must also withhold these taxes from their wages.
Annual Report and other Filing Requirements
In Missouri, LLCs do not have to file an annual report.
Missouri Business Formation Quick Links
- IRS — apply for an EIN online
- IRS information regarding the federal tax treatment of LLCs
- Business Registration Online Portal (SOS)
- Business Name Database (SOS)
- Registering a Limited Liability Company (SOS)
- Missouri Business Portal
- Missouri Department of Revenue
- Missouri Division of Employment Security
- Starting a Business (SOS)
- Naming Requirements: Missouri Revised Statutes Section 347.020
- Fictitious Names: Missouri Revised Statutes Section 417.200
- Articles of Organization: Missouri Revised Statutes Section 347.039
- Operating Agreements: Missouri Revised Statutes Section 347.081
Missouri LLC FAQs
How much does it cost to start a Missouri LLC?
For online applications, it costs $50 plus a $1.25 convenience fee. The state fee for paper filings is $105.
What is the processing time to form my Missouri LLC?
Online filings will be processed and approved immediately. However, if you file by mail, the processing time will range from 6 to 8 weeks.
What are the benefits of a Missouri LLC?
A Missouri LLC keeps your personal assets from being used to pay business debts. Additionally, LLCs are not subject to income taxes like corporations are.
Where do I check if my Missouri LLC name is available?
You can search the Missouri Secretary of State's business name database to find out if the name you want is available.