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Guide to Forming an LLC in Missouri

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Follow our free guide to form an LLC in Missouri:

Check out our informative guide on building an LLC in Missouri and learn everything you need to know.

Pros and Cons of Forming an LLC in Missouri

missouri llc

Pros

Low Cost of Doing Business
Missouri does not burden small business owners with high fees and taxes — the filing fee is 50% less than most states and businesses do not have to pay an annual report fee or corporate tax rate (for LLCs).

Privacy for Owners
Missouri state law does not require the LLC members/manager to be listed in the Articles of Organization. An organizer (the party who prepares and files the paperwork) can be used to submit the official documents to the state in place of the actual owners.

No Annual Report Required
Missouri is one of the few states that does not require an annual report from businesses. This translates to both time and money saved, as some states charge as much as $200 to file a periodic report.

Cons

High Crime Rate
While some reports suggest a recent shift, the crime rate in Missouri is relatively high compared to the national average. In 2016, Missouri’s crime rate was 40% higher than the U.S. median. Kansas City and St. Louis are among the most dangerous cities in the country.

Competitive Labor Market
Missouri currently has a 3.4% unemployment rate, just under the national rate (3.7%). While this is good news for the state, it is less good news for small business owners who are looking to hire qualified employees.

Cost of Doing Business

  • $50 filing fee / no annual report
  • No corporate or franchise tax

Phase One: Starting Your Missouri LLC

The process of forming an LLC in Missouri may seem complicated and difficult, but the steps involved can be fairly easy when you have the right help. Below if a list of the initial steps you must do to ensure that your Missouri LLC comes together correctly:

Step 1: Name Your Missouri LLC

Your first major step for forming your Missouri LLC is to choose a business name. Be aware, however, that there are state and federal guidelines concerning the use of certain words business names.

Tip: Use a free business name search tool to ensure your company’s desired name is available.

Business Name Guidelines

  • The official name of your business must end with: Limited Liability Company, Limited Company, LLC, or L.L.C.
  • Your business name cannot be intentionally misleading to consumers
  • The name of your new LLC must not be similar to another organization’s name/trademark

Restrictions

  • “Lottery” and “Bank” are ineligible for use (any state)
  • Terms that represent educational or Veterans’ organizations are restricted
  • Terms related to the Armed Forces or civil servants (police, EMT, fire)

LLC business names associated with government and/or financial entities are not always restricted - it depends on the state. Additional paperwork may be required.

URL Availability
Your business also needs an online presence — even if you do not have an online business, your LLC still needs a website. You can easily check domain name availability at a number of online web services sites.

Step 2: Establish Ownership

The owners of an LLC are instead known as members and managers. All LLCs have members, but not every LLC has managers —  the difference depends on the management structure of the business.

LLC Management Structures:

  • Member-managed: All members participate in operating and making decisions for the LLC
  • Manager-managed: An appointed manager oversees the daily operations of the LLC and the members are not actively involved. 

Missouri LLC Member Guidelines

Required Number of Members
Missouri LLCs must have at least one member or manager in order to form an LLC.

Member Disclosure Requirements
An organizer/authorized representative may sign and file the Articles of Operation in place of the LLC members.

Age Restrictions
LLC members in Missouri may be of any age.

Residence Restrictions
There are no residency restrictions imposed on LLC members in Missouri.

Step 3: Find a Registered Agent in Missouri

The registered agent is necessary for all LLCs formed in Missouri. Your business cannot be official without filling this position.

What is a registered agent?
A registered agent can either be a person or business who is authorized to accept official government mail and service of process notices on behalf of the LLC.

Why do you need a registered agent?
Missouri law requires you to appoint a registered agent; the government expects your LLC to always have a consistent contact person.

What are the main requirements for a registered agent?

  • The registered agent must have a physical address — not a P.O. Box
  • The registered agent must be available during business hours

Who can be a registered agent in Missouri?

  • A state resident with a physical address in Missouri
  • An LLC or corporation that is licensed to conduct business in Missouri

Is the registered agent’s contact information publicly accessible?
The name and contact information of the LLC’s registered agent is a matter of public record.  

Can I be my own registered agent for my business?
You are legally allowed to be your own registered agent as long as you have a physical address in Missouri.

Is being my own registered agent discouraged?
LLC business owners who choose to be their own registered agent risk compromising their personal information.

Tip: Avoid the hassles and choose Swyft Filings to fill the registered agent needs for small businesses in Missouri. Find more information here.

Step 4: File the Articles of Organization

The most important part of the initial set-up process is filing the Articles of Organization with the Secretary of State. Without the vital document, your Missouri LLC is not legally recognized by the state.

What is the Articles of Organization?
The Articles of Organization is a legally binding document that is filed with the state government to officially and legally form your LLC.

Why do I need the Articles of Organization?
Your Missouri LLC will not be legally recognized by the Secretary of State without filing this document. Consider the Articles of Organization as part of your LLC’s foundation.

What information is included in the Articles of Organization?

  • The name of the LLC
  • The location of the business
  • The name(s) of the organizer filing the paperwork
  • The name and location of the registered agent
  • The chosen management structure of the LLC
  • The statement of purpose

Additional Missouri Filing Information — Professional LLCs 

Professional service businesses in Missouri are allowed to form what is known as a Professional Limited Liability Company (PLLC).

The following professions are allowed to form a PLLC:

  • Accountants
  • Attorneys
  • Physicians and Medical Professionals
  • Professional Counselors and Psychologists
  • Architects and Engineers
  • Veterinarians
  • Social Workers

A few points to consider:

  • All members of the PLLC must be licensed in the profession of the business.
  • The PLLC is only allowed to provide services for which the business was formed.
  • The members are still subject to whichever licensing boards govern the PLLC’s profession.

Step 5: Create an LLC Operating Agreement

While an Operating Agreement is not required by the state of Missouri in order to form an LLC, this document is absolutely necessary for any business because it adds structure to your company and projects professionalism.  

What is an LLC Operating Agreement?
The LLC Operating Agreement is a legal document that plainly lays out the rights and responsibilities of each person involved in the business and clearly details how the business will operate.

Why do I need an LLC Operating Agreement?
Because the LLC Operating Agreement defines the roles of the business’s members and provides direction for daily operations, the document ensures stability and structure to the LLC and reduces future disputes.

Do I need to file the LLC Operating Agreement?
You do not need to file the Operating Agreement; the document is for the benefit of your LLC and remains in-house.

What goes into an LLC Operating Agreement?
Most LLC Operating Agreements include the following the information:

  • Designation of the members/managers
  • Initial capital contributions of the members
  • Voting designations and percentages
  • Member transfer/addition rules and restrictions
  • Distribution of profits

Get a customized LLC Operating Agreement for your small business with Swyft Filings. Add structure to your LLC now.

Step 6: Obtain an EIN

Most businesses formed in Missouri must register for an EIN. Your Missouri LLC will not be able to conduct business without this ID.

What is an EIN?
The EIN is a nine-digit number that is assigned to your business by the Internal Revenue Service (IRS) and identifies your business much like a personal Social Security number.

What does EIN stand for?
EIN is an acronym for Employer Identification Number. It is also known as a Federal Tax ID.

Are all businesses required to have an EIN?
Federal law dictates that certain types of business entities register for an EIN:

  • Any business with employees (even if owned by one person)
  • Any business with more than one member
  • A partnership (LLC or C-corp)

Please Note: A sole proprietorship is not required to have an EIN, but it is still recommended.

Why does my LLC business need an EIN?
The more common reasons you would need an EIN are:

  • To hire employees
  • To open a bank account in the U.S.
  • To file your company’s taxes
  • To pay independent contractors

In short, if you make money through your business and it has employees, you must have an EIN.

Is the EIN publicly listed?
The EIN for your LLC will be part of public record.

Can I use my Social Security Number as the EIN?
You can choose to use your own social security number as your business’s EIN; however, keep in mind that the EIN is part of public record.

Swyft Filings offers EIN services for small businesses in Missouri. Find more information here.

Phase Two: Maintaining Your Missouri LLC

You have completed the initial phase of setting up your Missouri LLC, but the next process is meant to make you fully compliant with the state and get your business ready to function. The next few steps are:

Step 1: Register for Missouri State Taxes

Missouri does not impose a corporate or franchise tax on LLCs. Members of the business will only need to pay state and federal income taxes on their earnings.

State Income Taxes
Missouri’s state income tax rate is currently 6% for all income above $9,000; the rate is scheduled to drop to 5.5%in January 2019.

Corporate Tax Information
You can also choose to have your LLC taxed as a corporation; if so, you will be responsible for paying the corporate income tax rate on your business’s earnings. Corporations in Missouri must pay a 6.25% corporate income tax.

Additional Tax Information
Other taxes your LLC may need to pay:

  • Sales and Use Tax at 4.225%
  • Employee Withholding Tax
  • Unemployment Tax

Step 2: Obtain Business Licenses and Permits

The licenses and permits required for an LLC in Missouri can vary, depending on a number of variables:

  • Location (city and county)
  • Type of Business
  • Industry

Tip: If you would like to see more in-depth information on licenses and permits, please feel free to visit the content in our learning library that covers business licenses and permits.

Step 3: Obtain a Certificate of Good Standing

There is one last step after your Missouri LLC has been formed — getting a Certificate of Good Standing.

What is a Certificate of Good Standing?
The Certificate of Good Standing is a state-issued notification that confirms your business is properly formed and is in compliance with all Missouri regulations.

Who issues the Certificate of Good Standing?
The Certificate of Good Standing is generally issued by the Secretary of State.

When can I request a Certificate of Good Standing for my business?
Request a Certificate of Good Standing after your LLC is officially formed through the Secretary of State.

Why do I need a Certificate of Good Standing?
Many businesses and financial institutions want proof that your LLC is in good standing with the state government and may insist on the certification before agreeing to any business deals. Additionally, some states require a Certificate of Good Standing before a business can apply for Foreign Qualification.

Does the Certificate of Good Standing have an expiration date?
The Certificate of Good Standing does not expire/does not need to be renewed.

Swyft Filings can create a Certificate of Good Standing for your Missouri LLC. Click here for more information.


Additional Missouri Resources

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