How to Start a Real Estate Business in Minnesota: Commerce License, 90 Hours and Broker Sponsorship

If you want to sell homes or commercial property in Minnesota, the license you need comes from the Minnesota Department of Commerce, not the Secretary of State. Many first-time founders assume that forming an LLC covers them. It does not. Real estate salespersons, brokers and real estate companies are licensed under Minnesota Statutes chapter 82, and the path is set: be 18 or older, complete 90 hours of approved education, pass the PSI salesperson exam, and work under a licensed broker who submits your application.

This guide walks through that process in the order you will actually do it, with every fee and deadline we could verify. It is informational content, not legal or tax advice. Fees and rules change, so confirm each number with the agency named before you pay. If you plan to own a brokerage with partners, hold property in an entity, or have a complicated tax position, talk with a qualified real estate attorney or CPA.

Know what you are applying for

Minnesota licenses three roles in real estate. A salesperson can list and sell property but must work under a broker. A broker can sponsor and supervise salespeople and pays a higher initial fee. A real estate company is the brokerage entity itself. If your brokerage is a company, it needs its own Commerce license, even if you have already registered an LLC with the Secretary of State.

Minnesota has no general statewide business license. Filing Articles of Organization with the Secretary of State is a filing, not a license. Registering with the Department of Revenue for a Minnesota Tax ID is also not a license. Your real estate license is the credential that lets you practice. The entity and tax steps are separate business setup that you handle alongside it.

Materials and information you need before you start

• Proof that you are at least 18 years old, plus any identification Commerce asks for on its current application. Check the document list with Commerce.
• Completion certificates from approved real estate education providers. Confirm the provider is approved before you pay for a course.
• A PSI exam registration. Check PSI for the current exam fee, which is not in this guide.
• The name and license number of the Minnesota licensed broker who will sponsor you.
• A payment method for the Commerce license fee and technology surcharge.
• If you plan to form a company: a name that passes Secretary of State rules, the $155 online or in-person filing fee or $135 by mail for an LLC, and a Minnesota street address for the registered office.
• If you will operate under a trade name: a Certificate of Assumed Name ($50 online or in person, $30 by mail) and a qualified legal newspaper in your county for publication.
• A calendar with June 30 and December 31 marked on it.

Step 1: Confirm you meet the basic requirements

The baseline requirement for a salesperson license is age. You must be 18 or older. Decide early whether you want to start as a salesperson, which is the normal entry point, or apply directly for a broker license. The initial broker license costs $180, and broker requirements differ from salesperson requirements in ways this guide does not cover. Ask Commerce what a broker applicant must show before you commit to that path.

Step 2: Complete the first 30 hours of education

Minnesota requires 90 hours of approved real estate education before a salesperson license is issued. Under Minn. Stat. 82.59, subdivision 8, 30 of those hours must be completed before you take the exam, and the remaining 60 hours come after the exam. Commerce describes the requirement as three 30-hour courses. Choose a provider you have confirmed is approved, and get written confirmation of the course title, hour count and completion date. Keep every certificate, because you will need them for the application.

Step 3: Pass the PSI salesperson exam

Once your first 30 hours are complete, register with PSI for the salesperson exam. PSI sets the exam fee, not Commerce, so check PSI's current price before you book. Study from your course materials and a current practice test. Schedule a date you can keep. A missed or failed attempt can cost you the exam fee again and delay everything that follows. Confirm PSI's retake rules before you pay for a second attempt.

Step 4: Find a sponsoring broker

A salesperson must be associated with a licensed broker, and that broker submits the license application. This is the step most new agents underestimate. Interview at least three brokerages. Ask how they train new agents, who supervises your transactions, what the commission split is, what fees you pay besides the split, and whether they will sponsor you before your exam date. Get the terms in writing. Do not pay for a license or a training package until you understand what the broker will provide.

Step 5: Finish the remaining 60 hours

After the exam, complete the remaining 60 hours of approved education. Do not wait until the last week. Course sections fill up, and a gap in your certificates can hold up the application. Once your education is complete and you have passed the exam, your sponsoring broker can submit the application to Commerce.

Step 6: Submit the application and pay the fees

The initial salesperson license is $100, plus a technology surcharge. The surcharge includes $30 for the education, research and recovery fund. The total surcharge amount is not in this guide, so confirm it with Commerce before you pay. Your sponsoring broker submits the application, so ask for a copy of what was filed and the date it went in. Check with Commerce for a current processing time, and plan for a gap between submission and your first day of active work.

Step 7: Decide whether you need a company license

Most salespeople do not need a company license. You need one when you open or operate a brokerage company. A real estate company license costs $180 from Commerce. If you form the company as an LLC, the Secretary of State filing is separate from the Commerce license, and you need both.

For the LLC filing, Articles of Organization cost $155 online or in person and $135 by mail. The Secretary of State treats online and in-person filings as expedited, and mail filings are not. The name must include "limited liability company" or "LLC," must not contain "corporation" or "incorporated," and must be distinguishable from every entity already on file. You can reserve a name for 12 months for $55. Minnesota requires a registered office at a Minnesota street address, and a PO box alone is not accepted. A registered agent is optional for a domestic LLC.

An LLC does not need newspaper publication, but a trade name does. If your brokerage will operate under a name other than the LLC name, file a Certificate of Assumed Name with the Secretary of State for $50 online or in person, or $30 by mail. The certificate must be published for two consecutive issues in a qualified legal newspaper in the county of your principal place of business. Failure to publish may make the certificate invalid. The certificate renews annually at no charge.

Step 8: Register for tax and check local rules

Register with the Department of Revenue for a Minnesota Tax ID and a Sales and Use Tax account if you will make taxable sales, such as selling merchandise or certain goods. Registration is not a license. The state sales tax rate is 6.875 percent, plus any local taxes. If your LLC is taxed as a partnership or disregarded entity, income passes through to the owners, who pay individual income tax at rates from 5.35 to 9.85 percent. An LLC that files federally as a C corporation pays the 9.8 percent corporation franchise tax. Confirm which treatment applies to your entity with a CPA.

Local rules depend on where your office is. Minnesota has 87 counties, about 853 cities and about 1,780 townships. Minneapolis and St. Paul license by category, and neither issues a general business license. A home office, a storefront or a sign can still trigger zoning rules or a category license. Check with your city or township before you sign a lease or put up a sign.

Step 9: Plan your renewals

Salesperson renewal costs $60 plus the technology surcharge, and renewals are due June 30 at the end of each license period. You must complete 30 hours of continuing education every 24 months under Minn. Stat. 82.61. Broker and company renewal fees are not in this guide, so check the current amounts with Commerce. Put the June 30 deadline on your calendar the day your license is issued.

Your LLC has a separate yearly filing. The Annual Renewal costs $0 if the entity is active and in good standing, and it is due December 31 every year. Missing that date can lead to termination or revocation of the LLC without further notice.

Fee summary

Item	Agency	Cost	Deadline or frequency
Initial salesperson license	Commerce	$100 plus technology surcharge	At application
Salesperson renewal	Commerce	$60 plus technology surcharge	June 30 each license period
Initial broker license	Commerce	$180	At application
Real estate company license	Commerce	$180	Confirm renewal with Commerce
Articles of Organization (LLC)	Secretary of State	$155 online or in person; $135 by mail	One time
Certificate of Assumed Name	Secretary of State	$50 online or in person; $30 by mail	Publish two consecutive issues; renews annually at no charge
Name reservation	Secretary of State	$55	12 months, renewable
LLC Annual Renewal	Secretary of State	$0	December 31 every year
Salesperson exam	PSI	Check PSI	Before you register

Common mistakes to avoid

• Treating the LLC filing as your license. The Secretary of State filing does not authorize you to sell real estate. Commerce does.
• Assuming your company needs no license. A brokerage that is a company needs its own Commerce license.
• Paying for education before checking approval. Confirm the provider and the hour count in writing first.
• Working before you are licensed and sponsored. Do not take listings, accept commissions or market property as an agent until your license is issued and you are associated with your sponsoring broker.
• Skipping the DBA publication. A Certificate of Assumed Name that is not published in a qualified newspaper may be invalid.
• Using a prohibited word in an LLC name. "Corporation" and "incorporated" are not allowed.
• Missing June 30. A lapsed salesperson license may mean lost time and reapplying.
• Waiting on continuing education. Plan the 30 hours every 24 months from the start so renewal is not a scramble.

What results to expect

If you follow these steps in order, you can expect to finish with a salesperson license tied to a sponsoring broker. You may also end up with a company license and an LLC if you open your own brokerage. The total timeline depends on how quickly you complete 90 hours of education, when PSI exam seats open near you and how fast Commerce processes the application. None of those dates is guaranteed, so build in slack. The outcome also depends on meeting Commerce's current requirements, and only Commerce decides whether an application is approved.

Where to confirm each number

• Minnesota Department of Commerce: license fees, the technology surcharge, renewal rules and education requirements. Search mn.gov for Commerce real estate licensing.
• PSI: the current salesperson exam fee and scheduling.
• Minnesota Secretary of State: https://www.sos.mn.gov/, and Business Filings Online at https://mblsportal.sos.mn.gov/Business/Search
• Minnesota Department of Revenue: https://www.revenue.state.mn.us/
• Minnesota Small Business Development Center Network: business planning help for a brokerage, at https://mn.gov/deed/business/help/sbdc/

This article is informational content only. It is not legal or tax advice. Consult a qualified real estate attorney or CPA before you form an entity, sign a brokerage agreement or make tax decisions.