Articles of Organization

Forming your new LLC in Missouri requires filing articles of organization with the Corporations Division of the Missouri Secretary of State. A minimum filing fee of $116 applies.

The new LLC's articles of organization must be executed (signed) by at least two of the organizers and include the company's name, the purpose for which it is being formed, the organizers' names and addresses, the street address of the LLC's registered office (including the county), the name of the LLC's registered agent at that office, and a statement as to whether the LLC will be manager- or member-managed. It must also state if the LLC is scheduled to dissolve by a certain date or upon a certain event, or if it is perpetual.

The articles may also include other items that the members decide to specify, as long as they don't go against state law, even if they are also included in the operating agreement.

Your LLC is considered "organized" once an original and a copy of the articles of organization are received by the Missouri Secretary of State's office with the appropriate filing fee. The articles must be executed by at least two organizers. The articles of organization are effective as of when they are filed.

Registered Agent and Office

Every Missouri LLC must have an in-state registered agent to receive official state correspondence, both administrative and legal. An LLC registered agent can be an individual resident or a corporation that is authorized to conduct business in Missouri. The registered office can be a place of the LLC's business, but the registered agent must have as a business office that is the same as to the registered office.

Operating Agreement

One of the LLC's most important documents is its operating agreement, which can be amended or repealed as allowed by the agreement itselfor applicable state law. Having an operating agreement isn't technically mandated by the state-but it's a vital internal document that officially sets out how the LLC will operate. The operating agreement lists the members, how much each one has invested, how profits are to be divided, and how much relative weight each member has when matters come to a vote.

The operating agreement may also list when meetings can be held, how much notice must be given, what constitutes a quorum, voting rules, and so on, but it is not required to. Usually, though, it does list rules already specified in state laws. It can also include constraints on the members' power to adopt, change, or repeal an operating agreement. If there is more than one member, the original operating agreement must be approved by all the LLC's members in writing.

Membership in the LLC

An LLC has to have at least one member, and each member must be a natural person or a recognized business entity. The member may procure an interest in or become a member of the LLC when it is formed, in a manner specified in the operating agreement, or when the admission is recorded in the LLC's records. To become a member, the newcomer normally needs to make a contribution, pay cash, or transfer property to the LLC, or assume an obligation to do so. However, a person may be admitted as a member of the LLC without acquiring a membership interest if there is such a provision in the articles of organization or operating agreement, or if all members consent and the person's admission is documented in the LLC's records.

Members' contributions to the LLC can be in the form of cash, property, the use of property, promissory notes, services previously rendered, or some other valuable consideration.

A member can only resign from the LLC in the way that the articles of organization or operating agreement specify. These documents also usually list a minimum period of membership before resignation is allowed. LLCs can pursue damages from a former member if the member's resignation causes problem.

Ongoing Requirements

LLCs must submit an annual report to the Missouri Secretary of State that includes:

• The name of the LLC and the state or country where it was organized
• The street address and county of the LLC's registered office
• The name of the LLC's registered agent at that office
• Whether there has been any change in the registered agent or office
• The address and telephone number of the LLC's main office
• The name and address of each manager (or, if the LLC has no managers, its members)
• A brief description of the nature of the LLC's business

Missouri LLC's should also keep these records available for inspection:

• An alphabetical list of current and past members and managers and their mailing address
• Copies of records that would enable a member to determine the relative voting rights of the members
• The articles of organization and any amendments
• The LLC's federal, state, and local income tax returns for the past three years
• The written operating agreement with any amendments
• The LLC's financial statements for the past three years
• Any written promise by a member to make a contribution
• Any written consents by the members to the admission of any person to the LLC
• Any written consents by the members to continue the LLC after the withdrawal of a member
• Any other documents about issues required to be in writing pursuant to the operating agreement

In addition, it's a good idea for your LLC to keep available minutes of the proceedings of the board and committees of the owners or members.

Dissolution

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

• An event or events occur that the articles of organization or operating agreement specify as requiring dissolution
• The number or percentage of members specified in the operating agreement agree to dissolve the LLC
• An event happens that makes it illegal for the LLC to continue
• When a member leaves the LLC, unless the remaining members agree to continue the LLC within 90 days
• When the LLC is not the surviving entity in a merger or consolidation
• When a Judicial decree ordering dissolution is entered

Taxes

An LLC provides certain tax advantages compared to a corporation, including being able to make more deductions. An LLC is not treated as a separate tax entity like a corporation, but rather can be a "pass-through entity" when it comes to taxes, so that the LLC owners report business losses or profits on their personal tax returns.

Unless you choose for your LLC to be taxed as a corporation, the IRS treats single-member LLCs as sole proprietorships for tax purposes. This means the LLC itself does not pay taxes and does not have to file a tax return. The IRS treats multi-owned LLCs as partnerships for tax purposes, unless you choose for your LLC to be taxed as a corporation. This means that LLC owners each pay taxes on their share of the profits on their personal income tax returns, not the LLC itself.

The tax rate for Missouri LLCs varies, based on taxable net income.

Articles of Incorporation

After choosing a name, the next step for your new Missouri corporation is filing articles of incorporation. The articles must specify the corporation's purpose-Missouri allows a corporation to be formed for any lawful business activity. The articles must include whether the corporation is to be perpetual or of limited duration and the name and address of the corporation's initial registered agent. The articles should also define any limits to (or specify the elimination of) directors' liability to the corporation or the shareholders for monetary damages.

The articles must be delivered to the state secretary of state's office by at least one of the incorporators. There must be at least one incorporator; all of them must be a natural person (not just a legal entity) of at least 18 years age. Their duties are to sign, verify, and deliver in duplicate those articles of incorporation to the secretary of state. The articles must include the name(s) and address(es) of the incorporators.

The filing fee is $3, plus a minimum authorized stock fee of at least $55, which makes the minimum incorporation fee $58. The stock portion of the fee is based on the authorized amount of capital for the new corporation, which must be specified in the articles. The new corporation can authorize up to $30,000 of capital for the minimum $55 stock fee; for each additional $10,000 of authorized capital, the stock portion of the fee will increase by $5.

Missouri also also allows optional provisions to be included in the articles of incorporation. These can be items such as the number of members of the board of directors, provisions that limit or define the liability of directors, or whether shareholders may preemptively acquire additional shares.

Registered Agent and Office

Missouri corporations must each have a registered, in-state agent. The registered agent is the person or business entity designated to receive official state correspondence, including notice if the corporation is "served" with a lawsuit.

Likewise, the state requires that all corporations maintain a registered, in-state office that may be its primary place of business. The registered agent must maintain a business office identical to the registered office, and must be either an individual person living in Missouri or a corporation authorized to conduct business in the "Show Me" State.

Bylaws

Bylaws lay out a corporation's basic managerial and legal operating principles; the corporation must keep a copy at its main office, but is not required to file them with the state. Nonetheless, they are a critically important document for the corporation.

At its initial meeting, the board of directors should adopt corporate bylaws, and then keep them updated as time goes on. The corporation's board of directors can make, alter, amend, or repeal those bylaws, unless the articles of incorporation 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 Missouri corporation must have at least three directors, unless the articles of incorporation specify that the corporation may have only one or two. Directors for the corporation may be elected for one to three years.

Officers may be listed in the bylaws or elected by the board in compliance with the bylaws. A corporation must have at least a president and a secretary, chosen by the directors. An officer may hold more than one office in the corporation unless the articles of incorporation or bylaws say otherwise.

Required Reports

An annual report must be filed with the Missouri Secretary of State in the month that the company was originally incorporated (except for the first calendar year of incorporation). This report must include the corporation's name, the names and addressed of directors and officer, the name of the registered agent and the address of the registered office, and the corporate mailing address.

Taxes

The state of Missouri does impose a corporate income tax calculated based on the corporation's net income. Determining that taxable income starts with deducting operating expenses and proceeds to reach the net taxable income reported for federal tax purposes. The corporation may also deduct half of federal income tax payments before calculating next taxable income for state purposes. The Missouri state corporate income tax rate is 6.25%.