Starting an LLC In MN Guide ?

Question

Hi everyone,

Ive been scouring BP and am in no luck of finding a proper guide to start an LLC in MN. However, i was able to find this https://howtostartanllc.com/minnesota-llc#franchis... wondering if this would be a safe bet to start and LLC with the intent of Purchasing 2 or 3 properties in ? I currently do not own any real-estate yet however it should be coming very soon i have managed to raise a significant amount of money in the past year along with some potential non MLS sales coming my way.

LLC. owners/creators in MN please chime in I've read miscellaneous information on BP in regards to similar questions followed by typical answers "consult an attorney" etc. any leads to put me off in the right direction ? Is it a bad idea to setup an LLC online for overall protection in the future ?

Id also like to say thanks to the active members on here after the year of research and following some useful guides these dreams are starting to become a reality.

Thanks, Nick

Tim Swierczek · Answer

@Nick Ritter It's very possible you are over thinking it, but It definitely depends on if you are flipping or buy and hold. It also depends on if you will live in any of the properties you purchase. Also, do you have partners? Do you own a primary residence? These are all factors. In general, if you do not own a primary residence, you are not flipping the properties, and you do not have at least one partner then I do not believe an LLC is worth the costs. Of course, this is not legal advice and you really should consult with an attorney, CPA, and mortgage lender before you make the decision. Just know that from a lending perspective you limit your loan options tremendously and you will increase your cost, and potentially increase your insurance costs as well.

Scott S. · Answer

Hi Nick,Like others have said, setting up a LLC in MN is easy, once you've been through the process a time or two before. There's nothing wrong with having that company you shared a link to do the work. I wanted to have my hand held through the process my first time and am glad I did.I used Incfile.com recently and was pleased with the result and nice company binder that they sent me.An LLC and a good umbrella policy are two very wise things to have in place as you build up your portfolio. Always cover your assets.Having said that, I know a guy with close to 10 SFHs (all paid for!) still in his personal name. That proves you don't NEED an LLC to get started; getting started is the important thing!Good luck to you!

Aaron Abraham · Answer

It does seem you are overthinking this a bit. The MN Secretary of State's website has all the info you need. For a small fee and a few minutes of your time, you will have your new entity up and running. There are a lot of facets to running a business that people are not aware of. The yearly meetings, and as previously stated "keeping meeting minutes, having a registered agent, etc." These are all helpful in running a business but also to protect you personally (and your partners/shareholders) in the event of a lawsuit. If you are not running the business properly it gives the courts a reason to pierce/lift the protection of the corporate veil and hold you (and/or partners/shareholders) responsible. Lastly, I am not a lawyer, the above is just some of my small understanding of business law. Hope you the best in your future deals.P.S. I'm looking for a project to work on so if you have any deals you need to offload please reach out to me!

John Woodrich · Answer

LLCs are easy to setup, that link you posted is an online service that makes money setting up companies. I wouldn't set one up until you have a deal in mind or property under contract. No reason to incur the cost and lock in on a name until you need to. Depending how you plan to finance the property you may be required to purchase it in your personal name.

Amanda G. · Answer

Hi Nick,I'm a Minnesota native. LLC's are easy to set up in MN, but there are additional steps of keeping meeting minutes, having a registered agent, etc which I didn't know when I did it the first time. I used http://www.llc-for-free.com/ for filing and as my RA. The nice thing in MN is that there is no annual fee to keep it current, you just have to log into the state business website once a year. I used conventional financing on my first purchase (which is in GA) so I set up my LLC in GA while that was underway. It took about 2 weeks, plus a little time after for the local business license and bank account. Good luck!

Nick Ritter · Answer

anyone ?