Minnesota S Corporation Formation

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Steven S.

Steven Stark

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For over 30 years, Steven Stark has offered counsel to non-profit organizations and private companies. He has a passion for helping small businesses in particular since he himself started several businesses of his own in New York and Florida. He understands the importance of small businesses having a reliable attorney to advise them about legal matters from their inception.
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Joshua Garber

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Representing notable clients like Tesla and the City of Los Angeles, Josh Garber excels at helping clients with employment and labor laws. Many of his past clients have had great success using Josh for employment agreements and Division of Labor Standards Enforcement (DLSE) hearings. With his practical advice, he has even helped clients avoid going to court.
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Richard Gora

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Looking for an attorney with experience? Richard Gora is the exact attorney you want. Having defended over 100 cases both in state and federal courts and working with clients from around the globe, Richard has an array of different experiences. His services are wide-ranging and include business litigation, securities litigations, employment litigation, and business counsel. Prior to founding Gora LLC, he worked for Finn, Dixon & Herling LLP for eight years.
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Aaron D.

Aaron Dikos

Aaron is a corporate attorney with 13 years of experience advising clients on corporate, commercial and business transactions, mergers and acquisitions, corporate structuri... read more
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Kristin Cass

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Kristin Cass has over 23 years of experience as a corporate attorney. She is licensed to practice law in Illinois and New York, and have worked with some of the top legal firms in the United States. Kristin graduated from the University Of Chicago Law School with a Juris Doctorate degree. She primarily focuses on business formations and general business operations, but also has extensive experience in drafting and negotiating commercial contracts.
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Darlene Cypser

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Licensed in both Colorado and New York, Darlene Cypser has over 25 years of legal experience. She is comfortable as the role of advisor or will be your “champion” fighting for you in a range of personal or business areas if you need it. In the past, she has also drafted contracts and operating agreements, real estate contracts, prepared income tax returns, and negotiated leases, to name a few of her services.
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Paul Kossof

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I assist companies with international legal issues, primarily relating to China. I have helped clients from around the world, both private and state-owned, with a wide ran... read more
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Chris S.

Chris Shea

Christopher Shea has enjoyed a successful career in commercial litigation and government service, holding a number of notable positions with the Ohio state government including the Office of the Ohio Secretary of State and the Ohio Attorney General’s Office. Shea now focuses his practice on providing counsel for individuals in business transactions, risk management, and litigation.
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Steven Washington

Steven Washington is a corporate attorney that was recently licensed to practice law in Nevada. He obtained his legal degree from the William S. Boyd School of Law. Steven also holds a degree in Political Science. He specializes in drafting and negotiating commercial contracts, and is also experienced in employment law. Steven often represents start up businesses to help them overcome legal obstacles. He has been a law clerk at the Eighth Judicial District Court since February 2016.
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Darnell Ingram

Darnell Ingram is a corporate attorney who has been practicing law for the past 11 years. Darnell is licensed to practice law in multiple states, including Florida and the District of Columbia. He obtained his J.D. Degree in law after his graduation from the Stetson University College of Law. Darnell primarily specializes in drafting, negotiating and reviewing commercial contracts. In September 2009, Darnell founded his own legal firm, where he now acts as the principal attorney.
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Why use UpCounsel to hire a Minnesota S Corporation Formation Attorney?

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Why use UpCounsel to form an S Corporation in Minnesota

Starting an S Corporation in Minnesota with a business startup attorney on UpCounsel is easy, informative, and cost-effective. In just three simple steps, our S Corporation attorneys will help you protect your business and personal assets, and help you organize your business for state and federal compliance for an S Corporation.

When forming an S Corporation in Minnesota with UpCounsel, the attorney you choose to help you will conduct a business name search for your Minnesota S Corporation and assist you in preparing your S Corporation Operating Agreement, along with providing other legal services based on your needs. Once your Articles of Incorporation have been prepared and successfully filed with the Minnesota Secretary of State, your Minnesota S Corporation has been formed and begins its existence as a corporate entity.

However, a corporation does not register as an S Corporation with the Secretary of State. It registers as a corporation with the state and then may file for S Corporation status with the IRS. S Corporation status is a taxation category which provides income tax advantages to small businesses.

Choosing a Company Name for Your S Corporation

One of the first steps in the process of forming your S Corporation is to choose your business name.

The business name that you choose must contain the words "incorporated", "corporation", "limited", or "company", or an abbreviation of these words. The name may not indicate or imply that the corporation is organized for a purpose other than one permitted by state law or its articles of incorporation. It must be distinguishable (not the same as or deceptively similar to) the name of an S Corp or foreign S Corporation reserved or registered.

Your S Corporation name may contain the name of one or more members.

By using UpCounsel, you can choose several business names in order of preference. Your attorney of choice can then conduct a name check for your Minnesota S Corp before filing to see which names are available. Once you have chosen an available name, your chosen S Corporation attorney can help you properly register your name with the State of Minnesota.

Requirements for Forming a Minnesota S Corporation

Articles of Incorporation: When forming an S Corporation in Minnesota, the Articles of Incorporation must be filed with the Minnesota Secretary of State. Minnesota state law requires that certain information be included in your Articles of Incorporation when forming your Minnesota S Corporation.

This information must include:

  1. The S Corporation name and address.
  2. The purpose of the S Corporation.
  3. The name and address of the registered agent for service of process on the S Corporation.
  4. The number of shares, and their class, that the S Corporation is authorized to issue.
  5. The name and addresses of each of the incorporators.

Additionally, a Minnesota S Corporation formation generally requires inclusion and/or consideration of the following:

S Corporation Qualification Requirements: For a corporation to qualify as an S Corporation for tax purposes, it must meet the following requirements:

  1. Must be a domestic corporation.
  2. Have only allowable shareholders including individual, certain trusts, and estates; and may not include partnerships, corporations or non-resident shareholders.
  3. Have only one class of stock
  4. Have no more than 100 shareholders
  5. Not be an ineligible corporation (i.e. certain financial institutions, insurance companies, and domestic international sales corporations).

Additionally, a Minnesota S Corporation formation generally requires inclusion and/or consideration of the following:

S Corporation Operating Agreement: Although the S Corporation Operating Agreement is not required with the Articles of Incorporation, it is a good idea for every S Corporation with more than one member to have one. The Articles of Incorporation may contain restrictions or prohibitions on the power of the members to adopt, amend, or repeal an operating agreement. If there is more than one member, any operating agreement shall initially be agreed to, in writing, by all of the members. If you do choose to adopt an operating agreement, it does not have to be filed with the Secretary of State, but should be kept on file by the registered agent.

Membership: A S Corporation must have one or more members.

Eligibility Requirements: A natural person or an entity.

Procedure for Membership: The member may acquire an interest in the S Corporation directly from the S Corporation at the time of formation and, after formation, at the time provided in and upon compliance with the Articles of Incorporation or the operating agreement or, if not provided, only upon the vote of a majority in interest of the S Corporation members, excluding the vote of the person acquiring the membership interest, and only when the person becomes a party to the S-Corp's operating agreement.

Business Licenses: Business licenses and/or permits are required for most S-Corp's offering specific professional services. Contact the Minnesota State Corporations Commission for specific licenses.

Resident Agent needed for a Minnesota S Corporation

UpCounsel attorneys can also provide your business with a registered agent in Minnesota. Every Minnesota S Corporation must have a registered agent in Minnesota, which is the person or office designated to receive official state correspondence and notice if the company is "served" with a lawsuit. A Minnesota resident, corporation, or a foreign corporation that has the authority to transact business in Minnesota may act as a registered agent, as long as they have a physical street address in Minnesota.

Minnesota Secretary of State

Once you create an S Corporation in Minnesota, the Minnesota Secretary of State will require that certain recurring responsibilities and duties be fulfilled. The most important of these are explained below.

For further information, contact the Minnesota Secretary of State.

Recurring Responsibilities and Duties for Minnesota S Corporations

Periodic Report: Each S Corporation shall provide a periodic report to the Minnesota Secretary of State regarding its financial condition to each of its members. Your registered agent will be mailed a reminder prior to when your periodic report is due. If your periodic report is not filed on time, your S Corporation could face fines. The periodic report must be filed online at the Secretary of State's website.

Records: Each Minnesota S Corporation must keep the following records open to inspection at its office:

  1. A current list of the full name and last known business or residence address of each member and of each holder of an economic interest in the S Corporation set forth in alphabetical order, together with the contribution and the share in profits and losses of each member and holder of an economic interest.
  2. If the S Corporation is manager-managed, you will need a current list including the full name and business or residence address of each manager.
  3. A copy of the Articles of Incorporation and all amendments thereto, together with any powers of attorney pursuant to which the Articles of Incorporation or any amendments thereto were executed.
  4. Copies of the S-Corp's federal, state, and local income tax or information returns and reports, if any, for the six most recent taxable years
  5. A copy of the S-Corp's Operating Agreement, if in writing, and any amendments thereto, together with any powers of attorney pursuant to which any written operating agreement or any amendments thereto were executed.
  6. Copies of the S-Corp's financial statements, if any, for the six most recent fiscal years.
  7. The books and records of internal affairs as they relate to the S Corporation for at least the current and past four fiscal years.
  8. A signed "Incorporator's Statement" showing the names and addresses of the initial directors who will serve on the board until the first annual meeting of shareholders.

Filing Fees for a Minnesota S Corporation

Filing of the Articles of Incorporation must be made with the Minnesota Secretary of State in which the S Corporation was organized, along with the appropriate state filing fee. The fee for this is $135 and the Articles may be emailed or mailed along with the fee. Keep in mind that fees can be subject to change, so make sure to refer to the Minnesota Secretary of State for any updates.

Taxes for a Minnesota S Corporation

A Minnesota S Corporation is a special type of corporation created through an IRS tax election. An eligible corporation can avoid double taxation (once to the corporation and again to the shareholders) by a corporation with a Subchapter S designation by the IRS. A corporation must file a Form 2553 to elect "S" status within two months and 15 days after the beginning of the tax year.

Owners of the S Corporation report business losses or profits on their personal tax returns, and therefore the business itself is not taxed. Each shareholder is responsible for paying taxes on their pro rata share of the S corporation's items of income, deductions, and credits (through a Schedule K-1 form).

Minnesota state law follows federal law for income tax purposes. Therefore if a corporation is classified as an association taxable as a S Corporation for federal income tax purposes, so will it be taxable as a corporation for state tax purposes.

Federal Income Tax: An S Corporation does not pay federal income tax.

Minnesota State Income Tax: Minnesota does not impose an income tax on businesses.

Federal Tax Identification Number: Your corporation will need to obtain a federal tax identification number, which is also known as an Employment Identification Number (EIN). You do not need to get a new EIN after the corporation choose to become a S Corporation. An EIN is similar to an individual's social security number. You will need an EIN for your S Corporation as long as there is one member, even if the S Corporation does not have employees. For certain tax filing requirements the attorney you choose on UpCounsel can help prepare your Federal Tax ID Application, if you have not done so already.

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