The decision to start your own business can be overwhelming.
For those of us who live in Mississippi or just want a Mississippi-based business, forming an LLC may be our best choice.
As an experienced professional in business formation, specifically in running an LLC in Mississippi, I've crafted a comprehensive guide to assist you in successfully navigating the process of starting your own LLC.
With a decade of legal expertise, my team and I gathered all the information you need to run a successful Mississippi-based business.
Quick Summary
- To start an LLC in Mississippi you need to name your LLC first, then choose a registered agent service, and prepare documents for further formation.
- To form your Mississippi LLC you will have to pay the state fee, plus the LLC formation filing fee. Since you can apply for it online, you can expect it to be a few days long process.
- Open a different business bank account for the LLC, keep company and personal finances separate, and think about purchasing business insurance as protection.
Set up a Mississippi LLC the Right Way
To start an LLC in Mississippi, you must go through a couple of steps.
The first steps involve naming your business and filing the certificate of formation with the Secretary of State.
You can file online or via mail. That goes for most of the legal documents necessary to start an LLC.
Here's everything you need to know about starting an LLC in Mississippi.
1. Name Your Business
First, you need to name your business. There are a few ways to go about this, including filing the name with an official state agency or business association [1].
You can check whether your chosen name is available by checking business name databases.
This can be done online, and you should check periodically for availability because business names change hands frequently.
However, the surest way to secure a business name is by filing it as a "Doing Business As" (DBA) or with your county clerk's office in Mississippi, where you will operate your business.
It's also possible to reserve an LLC name by paying a $25 fee to the Mississippi Secretary of State.
The reservation lasts for 180 days, after which the business name becomes publicly available again.
You should also make sure your business name complies with any regulations or other rules business associations may have for business names in Mississippi, such as restrictions on what terms are allowed and whether it is necessary to include a disclaimer about their purpose.
2. Find a Registered Agent
An LLC registered agent is an individual or business entity that will receive important legal and sales tax documents on your LLC's behalf.
They can also be contacted if you run into problems with the Mississippi Secretary of State during business operations, such as getting fined for not filing a form on time.
You should consider hiring your own registered agent to handle these responsibilities. You could also hire a top Mississippi registered agent service to take care of the job for you [2].
To work as a Mississippi LLC registered agent, an individual must meet certain requirements and file paperwork with the Mississippi Secretary of State.
3. Submit Mississippi Certificate of Formation
A certificate of formation is a document that is used to create a legal business entity.
It must include the name, the registered agent name and address, its effective date or creation date, a NAICS code, email address, and the signature of a member, manager, or organizer.
The Mississippi LLC processing period is about 5 days. Once you get your Mississippi LLC certificate, you will need to file it with the Secretary of State.
See our article for more information on how much it costs to start an LLC in Mississippi.
4. Put Together a Mississippi LLC Operating Agreement
While an operating agreement isn't required in Mississippi, it is highly recommended.
Not only will an operating agreement make your business more organized and professional, but the terms of the operating agreement are legally binding.
The first thing you need to do when creating a Mississippi LLC operating agreement is to determine who needs to be included in this contract.
Operating agreements should include the following information:
- The name of the LLC and the address.
- A statement about all members' shares, voting rights, and equity interests in the company.
- What happens if a member leaves or dies (a buy/sell agreement).
These are only some of the things that usually appear on an operating agreement.
After you draft your operating agreement, make sure to keep it updated as changes occur.
Operating agreements should help business entities and LLC owners conduct business without complications down the line.
You should consider hiring an attorney if you need help creating your operating agreement, but many online resources can guide you through the process.
Always get legal advice from a professional if you run into any issues during the LLC formation process.
5. Secure An Employer Identification Number
Finally, you can get a federal employer identification number (FEIN or EIN) by visiting the Internal Revenue Service website.
On the IRS website, you'll find the online application you need to fill in. It's free of charge.
You don't need an EIN if you have no employees or if you're the only member.
However, if you want the government to collect sales tax from your LLC as a corporation instead of a sole proprietorship or want to hire employees, you won't be able to do so without an EIN.
Get a DBA Name for Your Mississippi LLC
DBA names are required in Mississippi if you want to do business under a name other than your LLC's registered name.
You should have this DBA, or "doing business as" document, even though it isn't technically necessary for LLC formation.
For example, banks and creditors may require that you provide one when applying for financing.
DBA's name doesn't need to have the word "LLC" in it.
Open Mississippi LLC Business Bank Account
You need an LLC bank account that's separate from your personal bank account.
Opening a bank account should be done as soon as possible after you've filed to form an LLC in Mississippi.
This is because banks probably won't do business with you until you have an EIN or establish that the company exists by filing the certificate of formation.
File Mississippi LLC Annual Reports
Every LLC doing business in Mississippi must file an annual report with the Secretary of State.
Each LLC member is responsible for filing these reports, but you can create a management company to do it instead if you wish.
These annual reports are due by April 15th of every year. There's no filing fee for Mississippi LLCs. In contrast, a foreign LLC needs to pay a $250 fee.
You must have a state-issued business ID number, or EIN before you file the LLC annual report in Mississippi.
Why Start a Limited Liability Company in Mississippi?
Starting an LLC in Mississippi is a great business move if you want to have personal liability protection and a simple management structure.
There are many reasons why someone would want to start a limited liability company.
Here are some of the top benefits:
- The ability to limit your personal assets exposure in case something goes wrong with your business
- Funding for growth and expansion opportunities without having to give up equity control
- Keep more profits and gains by paying less income tax
The LLC is one of the most popular business structures for entrepreneurs because it allows them to limit their exposure in case something goes wrong with their business while also having full control over all decision-making within the company.
This means that they can continue to grow or expand without giving up equity or voting rights.
FAQs
Can I Set Up a Mississippi LLC on My Own?
You can set up a Mississippi LLC on your own. However, since this includes business licenses you will need a lawyer to help you through the process.
Do I Need a Lawyer to Set Up an LLC in Mississippi?
You don't need a lawyer to set up an LLC in Mississippi.
You can get the business licenses yourself, but there are certain rules and regulations you must follow before filing your paperwork with the Secretary of State.
Is a Mississippi LLC Easy to Start?
Mississippi LLC is relatively easy to start. All you have to do is file the necessary documents and pay any fees associated with forming a business in Mississippi.
What Taxes Does an LLC Pay in Mississippi?
LLCs in Mississippi need to pay federal taxes. They are required to pay both income tax and self-employment tax on their business profits on a quarterly basis.
If the LLC has employees, it is also responsible for withholding federal payroll taxes from their wages.
Forming An LLC in Mississippi
The procedure for creating an LLC in Mississippi is typically simple and controllable, enabling you to take care of it on your own with remarkable ease.
However, it is strongly advised to get advice from a specialist if you are unsure about any actions or are worried about legal matters.
ZenBusiness stands out as a great option, providing knowledgeable guidance and insightful advice to guarantee a hassle-free and seamless experience throughout your LLC formation process.
We recommend ZenBusiness as we personally formed dozens of businesses using their service.
Our #1 Recommendation
ZenBusiness
References:
- https://corp.sos.ms.gov/corp/portal/c/page/login/portal.aspx
- https://www.sos.ms.gov/search/node/search?keys=registered+agent&op.x=0&op.y=0
