Articles of Organization

The formation of a Mississippi LLC means that you have to file a certificate of formation (along with the $50 filing fee) with the Corporations Division of the Mississippi Secretary of State.

The new LLC's certificate of formation must include:

• The LLC's name
• The LLC's registered office street and mailing address
• The registered agent's name and street and mailing addresses
• The period of the LLC's duration and, if not perpetual, the date of dissolution
• Whether the company will be member- or manager-managed
  

Your new LLC is officially deemed "organized" after the LLC's certificate of formation and one copy are delivered to the Mississippi Secretary of State's office (Corporations Division) with the filing fee, and that office then verifies that the certificate is in compliance with state law. The certificate must be executed (signed) by: an organizer if the LLC has not yet been formed or has no initial members: a manager, or by a fiduciary if the LLC is in the hands of a receiver, trustee, or other court-appointed fiduciary.

A certificate of organization will be issued by the Secretary of State and delivered, along with the conformed copy, to the LLC's designated representative. The original certificate of formation will be filed by the state along with the month, day, and year of filing.

Registered Agent and Office

All Mississippi LLCs must have designated a registered agent in the state-someone to receive official state correspondence, both legal and administrative. An LLC registered agent may be an individual who resides in Mississippi or a corporation (whether originally formed in Mississippi or not) authorized to conduct business in the state. Regardless, the registered agent's business office must be the same as the corporation's registered office.

The registered office may be a place of business for the LLC, but a post office box or mail drop is not allowed to be used as the agent's address.

Operating Agreement

The LLC's second most important document is its operating agreement. Having an operating agreement is not legally required by the state, but it's a very important internal document that sets forth how the LLC will run. The operating agreement needs to list the LLC's members, how much each one has invested, how any profits will be distributed, and how much relative weight each member has when voting.

The operating agreement may also include requirements for meetings (notice, quorum, voting rules, etc.) and similar functions, but it doesn't have to. Frequently, however, it does include operating constraints and allowances that are already contained in state law and regulations. It also may contain constraints on the members' authority to change or repeal the operating agreement or a provision thereof. If there is more than one member, the operating agreement must initially be unanimously approved in writing.

Membership in the LLC

An LLC must have at least one member; all members must be natural persons. Members may acquire an interest in the LLC directly at formation and, after formation, in accordance with the certificate of formation or the operating agreement (or, if the certificate of formation or the operating agreement does not specify, upon the written consent of all members).

The contributions of a member to the LLC may consist of cash, property, services rendered, or a promissory note or other obligation to contribute cash or property or to perform services.

A member always has the power-although not necessarily the right-to terminate his membership by resigning or retiring at any time. An LLC member may not resign except in accordance with the operating agreement or certificate of formation.

Unless otherwise stated in the certificate of formation or operating agreement, managers are elected or removed-and manager vacancies are filled-by members, using normal membership voting rules.

Ongoing Requirements

Mississippi LLCs must file a yearly report with the state Secretary of State that includes:

• The LLC's name and the state or country under the laws of which it is organized
• The street address (and the mailing address if different) and county of the registered office
• The name of its registered agent at that office 
• The address and telephone number of the LLC's principal office
• The names and business addresses of its managers or, if the LLC had no members, its organizers
• A brief description of the nature of the LLC's business

They also must keep available the following types of records open to inspection at their office:

• The name and street address of each member and manager
• A copy of the certificate of formation and any amendments and related powers of attorney
• Copies of previous operating agreements
• The amount of cash and a statement of the agreed-upon value of other contributions made or to be made by each member
• The times or events that would trigger any additional contributions by a member
• Any events that would trigger the LLC's dissolution

It's also a good idea to keep copies of the minutes of the various proceedings and committees meetings of the owners or members.

Dissolution

A Mississippi LLC is dissolved when any one of the following events occurs:

• At a time set out in the certificate of formation
• On the occurrence of event(s) specified in the certificate of formation or operating agreement
• Agreement to dissolve by the number or percentage of members specified in the operating agreement
• Event that makes it illegal for the LLC to continue
• When a member leaves the LLC, if a majority of the remaining members agree to dissolve
• Judicial decree ordering dissolution

Taxes

An LLC by its nature does offer some tax advantages over a corporation organizational structure, including access to more deductions, since the LLC is not required to be a separate tax entity like a corporation. Instead, it is considered a "pass-through entity" for tax purposes, meaning LLC owners report business profits and losses on their individual tax returns.

The tax rate for Mississippi LLCs varies, based on the amount of Mississippi taxable net income per reporting period.

Articles of Incorporation

New Mississippi corporations must file articles of incorporation with the Mississippi Secretary of State's office before they can start conducting business as a corporation. The articles must be delivered by at least one of the incorporators (who must be a natural person at least 18 years old), accompanied by the $50 filing fee. The following information must be included in the articles of incorporation:

• The name and address of the incorporators
• The street address of the corporation's initial registered office
• The name of the new corporation's initial registered agent at that office 
• The number of shares the corporation is authorized to issue
• Any information about the designation of particular classes of shares

Mississippi law allows a corporation to be formed for any lawful business activity. There is no requirement for a specific corporate purpose to be stated in the articles of incorporation.

Mississippi law also allows (but does not require) optional items to be included in the articles of incorporation for those corporations who wish to formally specify additional information, such as:

• The names and addresses of the corporation's initial directors
• The corporate purpose(s) (Mississippi allows a corporation to be formed for any lawful purpose, so a specific statement is allowed but not necessary)
• The powers and constraints of the corporation, its board of directors, and shareholders
• The number of authorized shares or classes of shares
• Provisions regarding the liability of directors in certain situations

Since Mississippi law does not use the concept of par value for stocks, you do not need to state a par value for your shares. The filing fee is a flat fee, rather than being based on your authorized shares, so you can authorize as many as desired. Most incorporators authorize common shares with equal voting, dividend, and liquidation rights and no special restrictions.

Registered Agent and Office

Every Mississippi corporation must have a registered agent in the state-the person or office designated to receive official state correspondence, both administrative and legal. The registered agent must be either a Mississippi resident whose business office is the same as the registered office, or a corporation with a business office identical to the registered office.

The registered office may be any of the corporation's places of business in Mississippi.

Bylaws

Bylaws lay out the corporation's basic managerial and legal operating principles. Mississippi corporations must keep a copy of their bylaws at their principal executive office, but are not required to file them with the state. At its initial meeting, the board of directors should adopt corporate bylaws, and then keep them updated as time goes on.

The board of directors of a corporation may adopt, amend, or repeal bylaws, unless the articles reserve this right to the shareholders. Bylaws normally address:

• Shareholders and directors meetings
• The authority, number, and tenure of directors
• Voting procedures
• The duties, responsibilities, and tenure of officers
• How stock is issued
• How and when annual financial information is provided to shareholders

Directors and Officers

A corporation's board of directors must consist of one or more individuals in accordance with the number specifed in the articles of incorporation or bylaws. If a board of directors has power to establish or change the number of directors, the board may only increase or decrease by thirty percent or less the number of directors last approved by the shareholders-only the shareholders may increase or decrease the number of directors last approved by the shareholders by more than thirty percent.

Officers are appointed or elected by the board in compliance with the corporation's bylaws, or elected by shareholders in compliance with the articles of incorporation. One officer has the responsibility of preparing minutes of director and shareholder meetings, and for maintaining and authenticating corporate records.

It is permissible for an officer to hold more than one office in the corporation unless otherwise prohibited by law or by the corporation's bylaws. Any officer may hold more than one office in the Mississippi incorporation.

Required Reports

The Mississippi Secretary of State requires that Mississippi corporations file a report each year within 60 days of the anniversary of its incorporation. The report must include:

• The corporation's name and the state or country of original incorporation
• The street address of the corporation's registered office in the state 
• The name of its registered agent there
• The address of the corporation's principal office 
• The names and addresses of the directors and principal officers
• A brief description of the nature of its business
• The total number of issued and outstanding shares, itemized by class and series (if any) within each class

Taxes

Mississippi imposes an annual corporate franchise tax of $2.50 per $1,000 of corporate capital, surplus, and profits, plus a corporate income tax. There is a minimum annual franchise payment of $25. You must file a combined corporate franchise and income tax return each year.