A North Dakota LLC operating agreement is a legal document that establishes how company owners want their LLC to operate. LLC company members can create this document with guidelines for naming officers, enforcing rules, and organizing ownership.
After they write this document and agree on its terms, they can keep individual records instead of filing them with an official government body.
Is an LLC Operating Agreement Required in North Dakota?
No, an LLC operating agreement is not legally required in North Dakota. However, it would be best to consider creating an operating agreement, as it can protect you from personal liability and provide other benefits.
If you create an LLC in North Dakota, your company will be subject to the provisions in the Uniform Limited Liability Company Act, which Chapter 10-32.1 of the North Dakota Century Code covers.
While creating an operating agreement is optional, the Uniform Limited Liability Company Act has specific statutes to follow as guidance:
- § 10-32.1-13 (Operating agreement – scope, function, and limitations)
- § 10-32.1-14 (Operating agreement effect on a limited liability company and persons becoming members – Preformation agreement)
- § 10-32.1-15 (Operating agreement – Effect on third parties and relationship to records effective on behalf of a limited liability company)
Costs and Fees
Here are some of the fees that come with forming and owning an LLC in North Dakota:
- $135 filing fee for a domestic or foreign LLC
- $10 to reserve a business name for one year
- $50 for the annual report
How to Start an LLC in North Dakota
Learning how to start an LLC in North Dakota isn’t complicated. Here are some steps you can follow.
Step 1 – Name Your LLC
Are you wondering how to get an LLC in North Dakota with a unique name? Before you get too far into the creative process, ensure another business doesn’t already have your preferred name. The North Dakota Secretary of State’s website has a search tool so you can confirm you don’t choose a name that already exists.
You can also ensure whatever name you choose has some variation of “Limited Liability Company” or “LLC” in its name. This identifier signifies the type of entity your business is.
Step 2 – Select a Registered Agent
North Dakota LLC registered agents must be a person, LLC, or corporation with a physical presence in North Dakota. An LLC cannot serve as its registered agent, although individual members can.
Ensure that the registered agent is willing and able to accept service of presence on your company’s behalf.
Step 3 – File Articles of Organization with the State of North Dakota
When you’ve decided on a name and found a registered agent, you can file your articles of organization with the Secretary of State.
Articles of organization state essential facts about your LLC, including:
- The name of your LLC
- The type of LLC you’re starting
- Your company’s registered agent
- The date you want your LLC to begin
- The end date of your LLC (if any)
- The local address of your LLC
- Your LLC’s purpose
Step 4 – Create an Operating Agreement
Your North Dakota operating agreement should contain the legal names of individuals who own your LLC. It should also include the official name of your LLC and the date you initially filed as an LLC in North Dakota.
North Dakota LLC operating agreements should include details relating to management, bylaws, operating rules, membership voting, and ownership percentages.
Step 5 – Get an Employee Identification Number (EIN)
An Employee Identification Number (EIN) is how the IRS identifies your LLC. You can get an EIN by filling out the required forms on the IRS website.
If you don’t have any employees, you may wonder why you’d want an EIN. If you plan to open any bank accounts, you’ll need your EIN or personal social security number if you own a single-member LLC. An EIN is the smarter choice for security when dealing with LLC finances.
Step 6 – File Annually
November 15th of each year is the annual LLC filing deadline in North Dakota. LLC owners can submit these forms and the required $50 fee via the First Stop link on the North Dakota Secretary of State’s page.
Failure to file by November 15th can result in a penalty fee and unsatisfactory standing with the state. Failure to file within six months of the deadline can result in the termination of your LLC.