How to Start a Corporation in Minnesota

How to Start a Corporation in Minnesota

How to Start a Corporation in Minnesota

A corporation in Minnesota is a legal entity separate from its owners (called shareholders). It has its own tax ID, can sign contracts, hire employees, and own property. The main tradeoff: a corporation requires more paperwork than an LLC, but it offers stronger liability protection and can be easier if you plan to raise outside investment or have multiple owners.

This guide walks you through the exact steps, costs, and timeline to incorporate in Minnesota. This is informational content, not legal or tax advice, consult an attorney or CPA for complex situations, especially if you have employees or plan to solicit outside investment.

What You Will Need Before You Start

Gather these materials before filing:

  • Business name: Must be distinguishable from other Minnesota corporations, LLCs, LLPs, and limited partnerships already on file. Under Minn. Stat. 302A.115 it must contain the word "corporation," "incorporated," "limited," or "company," or an abbreviation of one of them. Run a name search first at mblsportal.sos.mn.gov to confirm availability, it's free and instant.
  • Registered office address: A physical Minnesota street address where the Secretary of State can serve legal papers. Cannot be a PO box. Does not have to be your principal place of business. If you don't have an office yet, some registered agent services offer addresses for a fee.
  • Names of incorporators: At least one person (can be you, a co-founder, attorney, or agent) who will sign the Articles. The incorporator is the person filing the paperwork, not necessarily an owner.
  • Articles of Incorporation template: You can download the fill-in-the-blank form from the Secretary of State or write your own (Minnesota Statutes Chapter 302A sets the legal requirements).
  • Board of directors information: The board must have one or more directors (Minn. Stat. 302A.203). The first directors may be named in the Articles or elected by the incorporators or shareholders.
  • Filing fee: $155 if filing in person or online (expedited service included), or $135 if filing by mail (not expedited). Online and in-person filings are expedited by the Secretary of State; mail filings are not.

Step-by-Step Process to Incorporate

Step 1: Search Your Business Name (Free, 5 minutes)

Go to mblsportal.sos.mn.gov/Business/Search and search your intended name. The system will tell you if it conflicts with an existing corporation, LLC, limited partnership, or LLP in Minnesota. If your name is available, write down the exact name you want to file, spelling and punctuation matter.

If your name is taken, pick a different name. If it is available but you are not ready to file, you can reserve it with the Secretary of State for $55 online or in person, or $35 by mail (valid for 12 months, renewable). A name reservation holds your name while you prepare to file.

Step 2: Prepare Your Articles of Incorporation

Download the Articles of Incorporation form from the Minnesota Secretary of State at sos.mn.gov. Under Minn. Stat. 302A.111, the Articles must contain the first four items below and may contain the optional ones:

  • The corporation's legal name (exactly as you searched it)
  • Number of shares the corporation is authorized to issue (e.g., 1,000 shares, or any number you choose)
  • The registered office address (the physical Minnesota address where legal papers can be served)
  • Name and address of the incorporator (the person filing)
  • Optional: names and addresses of initial directors
  • Optional: other provisions you want to include (such as eliminating directors' personal liability, or limiting shareholder voting rights)

Keep the Articles simple unless you have a specific reason to add optional provisions.

Step 3: File Your Articles of Incorporation

You have three ways to file:

  • Online (fastest): File through the Minnesota Business and Lien System (MBLS) at mblsportal.sos.mn.gov. Submit your Articles and pay the $155 fee online. The Secretary of State says eligible online filings are expedited and typically processed within 2 to 5 business days, with the completed documents delivered by email.
  • In person: Book an appointment with the Secretary of State's office in St. Paul (appointment required) and bring your Articles and $155. In-person filings are expedited and processed while you wait.
  • By mail: Mail your Articles and a $135 check to the Secretary of State at 332 Minnesota Street, Suite N201, St. Paul, MN 55101. Processing is slower (no guaranteed timeline published) and not expedited. Include a cover letter with your name and phone number so they can call with questions.

Wait for your filing confirmation before moving to the next step.

Step 4: Obtain an Employer Identification Number (EIN)

An EIN is a federal tax ID for your corporation, issued by the IRS. You need it to open a business bank account, hire employees, and file taxes. Get your EIN for free at irs.gov/ein. You can apply online, where the IRS issues an approved EIN immediately, or by fax or mail with Form SS-4 (the IRS no longer issues EINs by telephone to domestic applicants). Have your Articles filing confirmation handy for the exact legal name and the date the corporation was formed.

Online EIN applications are approved immediately and you can download your EIN letter the same day.

Step 5: Register for Minnesota Taxes

Go to the Minnesota Department of Revenue at mndor.state.mn.us and register for a Minnesota Tax ID (needed if you make taxable sales, withhold Minnesota income tax from employees' wages, or file a corporation franchise tax return) and a Sales and Use Tax account (if you will make taxable sales). You will need your EIN and business address.

You only need to register for sales tax if you plan to sell goods or taxable services. If you are a service business with no retail component, sales tax registration may not be required, check with the Department of Revenue to confirm.

Step 6: Open a Business Bank Account

Visit your bank and open a business checking account in your corporation's name. Bring your Articles filing receipt, your EIN letter, and a photo ID. The bank will ask for your business address, EIN, and incorporation date. Requirements vary by bank.

Timeline: How Long Does It Take?

  • Name search: instant (online, free)
  • Filing (online): typically 2 to 5 business days (expedited)
  • EIN (online application): same day
  • Tax registration: online through the Department of Revenue (check with Revenue for timing)
  • Bank account: depends on your bank

Total time depends mostly on Secretary of State processing, which the office says is typically 2 to 5 business days for online filings; mail filings are not expedited and take longer.

Annual Renewal Requirement

Every year by December 31, you must file an Annual Renewal with the Minnesota Secretary of State. The renewal is free if your corporation is active and in good standing. If you miss the December 31 deadline, the Secretary of State administratively dissolves your corporation under Minnesota Statutes Section 302A.821. Reinstatement costs $65 by mail or $85 online or in person, so file on time to avoid this fee.

Costs Summary

Item Cost
Name search Free
Articles of Incorporation filing (online or in person) $155
Articles of Incorporation filing (by mail) $135
Name reservation (optional) $55 (12 months)
EIN (federal, from IRS) Free
Minnesota Tax ID registration Check with Revenue
Sales Tax registration Check with Revenue
Business bank account (varies by bank) Varies by bank
Annual renewal filing (if timely) Free

Minimum filing cost to incorporate: $135 by mail or $155 online or in person (filing fee only).

Common Mistakes to Avoid

Filing an Article With a Name That is Already Taken

The Secretary of State will reject your Articles if your name conflicts with a business already on file. Always search the name database before drafting your Articles.

Using a PO Box as Your Registered Office Address

The law requires a physical street address. A PO box is not valid. If you don't have a physical location yet, many registered agent services will provide an address for a fee, or you can use a co-working space address.

Missing the December 31 Annual Renewal Deadline

Set a calendar reminder for early December to file your Annual Renewal. Miss the deadline and the Secretary of State administratively dissolves your corporation. Reinstatement requires an extra fee and paperwork.

Confusing State Filing With Tax Registration

Filing your Articles with the Secretary of State is separate from registering for taxes with the Department of Revenue. Both are required if you will have employees or make taxable sales. File with the Secretary first, then register for taxes.

Forgetting to Obtain an EIN

You cannot open a business bank account or hire employees without an EIN. Get it immediately after your Articles are filed. It is free and takes 15 minutes online.

After Incorporation: What Happens Next

Once your corporation is officially formed, you should:

  • Hold your first board meeting: Document the initial board appointment, authorize the bank account, and authorize the officers to sign checks and contracts. Keep minutes in your corporate records.
  • Issue shares: Shares may be certificated or uncertificated (Minn. Stat. 302A.417). Keep clear records of who owns what for legal and tax purposes.
  • Create a corporate bylaws document: Bylaws are your internal operating rules (how meetings are held, who can sign checks, etc.). Not filed with the state, but kept in your records.
  • Open a business bank account: Your corporation must have its own bank account; do not mix personal and corporate funds.
  • File your first tax return: C corporations file Form 1120 (federal) with the IRS and Form M4 (Minnesota corporation franchise tax) with the Minnesota Department of Revenue; S corporations file different forms. Check the Department of Revenue's due dates page for your deadline, and talk to a CPA about timing and strategy.
  • Obtain any occupational licenses: Some businesses (contractors, real estate agents, childcare providers, etc.) need occupational licenses. Check License Minnesota and the city or county where you will operate.

Taxes After Incorporation

A Minnesota corporation that files as a C corporation pays a flat 9.8 percent state corporate franchise tax on income, plus a minimum fee (currently $0 for corporations with less than $1,280,000 in Minnesota property, payroll, and sales; rising to $12,830 for corporations with $51,280,000 or more). Consult a CPA to choose between C corporation, S corporation (pass-through), or other tax elections that may lower your tax burden.

When to Consult a Professional

You can file your Articles yourself if your situation is straightforward: you are the sole incorporator, you have one director, and you plan to be the only shareholder. However, consult an attorney if:

  • You have multiple shareholders or co-founders with different ownership stakes
  • You plan to raise outside investment or venture funding
  • You plan to have complex voting rights or classes of shares
  • You want to eliminate directors' personal liability or add bylaws restrictions
  • You are not sure whether a corporation or LLC is the right choice for your business

Talk to a CPA about your tax strategy as soon as your corporation is formed. The choice between C corporation and S corporation status can significantly affect your taxes, and it is easier to plan this from the start.

Key Resources

Summary

Incorporating in Minnesota costs a minimum of $135 by mail or $155 online or in person in filing fees, and the Secretary of State says online filings are typically processed within 2 to 5 business days. The process is straightforward: check your name, prepare and file your Articles of Incorporation, get an EIN from the IRS, and register for state taxes. File online with the Secretary of State for faster service. Remember to file your free annual renewal every December 31 to keep your corporation in good standing.

This guide is informational. It is not a substitute for legal or tax advice. Every business is unique, and the specific steps that apply to your situation depend on your industry, ownership structure, and growth plans. Consult an attorney or CPA for personalized guidance on incorporating, structuring ownership, and managing your corporate taxes.

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