Articles of Organization

Forming your Wisconsin LLC means that you have to file articles of organization. The articles must be executed (signed) by at least one person and delivered, along with a copy and the $170 filing fee, to the Department of Financial Institutions. The filed document must include a signature by a member, manager, or attorney-in-fact and indicate the name and title of the person signing the articles, which must include:

• The LLC’s name
• A statement that the LLC is organized under Chapter 183 of the Wisconsin Statutes
• The street address of the LLC’s initial registered office
• The name of the LLC’s registered agent there
• Whether the LLC will be member-managed or manager-managed
• The name and address of the LLC’s organizer(s)

It can also list other items—even ones that are included in the operating agreement—if the members so desire, as long as they don’t conflict with state law.

Registered Agent and Office

A Wisconsin LLC must continuously maintain a registered agent in the state—someone to receive official state legal and administrative correspondence on behalf of the LLC. A registered agent in Wisconsin may be an individual state resident (a “natural person”) whose business office is the same as the registered office, or a business entity with an office that is the same as the registered office:

The registered office may be—but does not have to be—the LLC's place of business.

Operating Agreement

The LLC’s second most important document is its operating agreement, which can be changed by the members as set forth by the agreement itself or applicable state law. Having an operating agreement is not legally required by the state, but it’s a vitally 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. It also may contain constraints on the members’ authority to change or repeal the operating agreement or a provision thereof.

Membership in the LLC

A Wisconsin LLC must have at least one member. A member may be admitted to the LLC either when it is formed (by signing the initial operating agreement) or, after the LLC is formed, by complying with the operating agreement. Unless the operating agreement specifies differently, a unanimous vote of all the members is required to admit a new member. If the operating agreement does not address this situation, a unanimous vote of all members who are entitled to vote can also bring in someone new.

A member can acquire an interest in proportion to their contribution, or in some other manner set forth in the LLC’s operating agreement. Becoming a member usually requires a contribution of cash, property, services rendered to the LLC, or a promissory note or obligation to contribute one of these.

An LLC member can only resign as permitted in the certificate of organization or operating agreement. A member with an interest for no or nominal consideration may not resign from a LLC except in accordance with the operating agreement. An LLC may be able to pursue compensation from a former member whose resignation damaged the LLC.

Ongoing Requirements

Wisconsin LLCs must file an annual report with the Department of Financial Institutions that includes the following information:

• The LLC’s name
• The address of the LLC’s registered office in this state 
• The name of the LLC’s registered agent there
• The address of the LLC's principal office
• If the LLC will be manager-managed, the managers’ names and addresses
• If the company is a foreign (i.e., out of state) LLC, the name and address of each member
• A brief description of the nature of the LLC's business

Additionally, each Wisconsin LLC must keep the following records open for review at its principal office:

• An alphabetical list of all past and present members and managers, their addresses, the date on which each became a member or manager, and the date each ceased to be a member or manager, if applicable
• A copy of the articles of organization and any amendments
• A copy of the LLC's federal, state, and local income or franchise tax returns and financial statements for the four most recent years
• Copies of all operating agreements, amendments, and any previous operating agreements
• Unless already set forth in an operating agreement, written records of:
  • The value of each member's contribution to the LLC
  • The times or events upon which any additional contributions are to be made by each member
  • Any events upon which the LLC will be dissolved and its business wound up
  • Any other documents required by the operating agreement
    

Dissolution

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

• Event(s) or a time specified in the articles of organization or operating agreement
• Unanimous written agreement or consent to dissolve
• Event that makes it illegal for the LLC to continue
• When there is a dissociation of a member unless the remaining members all agree to the admission of one or more additional members or managers, or unless the operating agreement provides otherwise
• Judicial decree ordering or approving dissolution

Taxes

An LLC is not required to be a separate tax entity like a corporation—instead, it can be (and usually is) treated as a "pass-through” entity so that the LLC owners report business losses or profits on their personal tax returns, like a partnership. Therefore, an LLC does offer tax advantages over a corporation, including the availability of more deductions.

Wisconsin’s personal income tax system consists of four brackets with a top rate of 6.75 percent that takes effect at an income level of $145,460. This top rate ranks the Badger State 17th highest among states levying personal income taxes.

Articles of Incorporation

Before conducting business in the state, Wisconsin corporations must file articles of incorporation with the state and pay a $100 filing fee. The articles must be delivered by at least one of the incorporators, who must be a natural person at least 18 years old. The incorporator is not required to be a director, officer, or shareholder of the corporation.

The following information must be included in the articles of incorporation:

• The number of shares the corporation is authorized to issue.
• Any provision granting or limiting preemptive rights.
• Name and address of the initial registered agent.
• A statement that the corporation is incorporated under the laws of Wisconsin
• A statement that says, “This document was drafted by (fill in incorporator’s name).”

Wisconsin law allows a corporation to be formed for any lawful business activity; the exact purpose does not have to be stated in the articles. The state also permits optional provisions to be integrated into the articles of incorporation, including:

• The names and addresses of initial directors
• Corporate purpose
• Regulations limiting the powers of the corporation, board of directors, or shareholders
• A par value for authorized shares or classes or series of shares
• Other provisions for managing the business and regulating the affairs of the corporation.

Registered Agent and Office

All Wisconsin corporations must have and maintain both a registered office (which may be the same as its place of business) and a registered agent in the state—the person or office designated to receive official state legal and administrative correspondence.

The registered agent must be an individual resident in Wisconsin whose business office is the same as the registered office, or a business entity authorized to conduct business in the state.

Bylaws

Bylaws describe the corporation’s basic managerial and legal operating principles. The corporation’s initial bylaws should be adopted by its incorporators or its board of directors.

A Wisconsin corporation should keep a copy of its bylaws at its main executive office, but is not required to file them with the state. The bylaws may contain any provision for managing the business and regulating the affairs of the corporation that’s not in conflict with law or the articles of incorporation.

The board of directors or the shareholders may adopt, amend, or repeal bylaws, unless the articles of incorporation or the bylaws reserve this right to the shareholders. At its initial meeting, the board of directors should adopt corporate bylaws, and then keep them updated as time goes on. 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

The corporation’s board of directors will consist of one or more natural persons. Normally, the corporation’s bylaws or articles of incorporation will specify the number of directors and their qualification prerequisites, if any. Directors must be natural persons. Directors are elected at the first annual shareholders’ meeting, and at each annual meeting thereafter unless their terms are staggered.

Officers must be named in the bylaws or elected by the board of directors. Officers may appoint other officers in compliance with the bylaws. The same natural person may simultaneously hold more than one office in a corporation.

At least one officer should be designated as responsible for preparing minutes of the directors' and shareholders' meetings, and for maintaining and authenticating corporate records.

Required Reports

A report must be filed annually with the Wisconsin Department of Financial Institutions in the same quarter in which the company was incorporated. This report must indicate:

• The corporation's name
• The address of the corporation’s principal office
• The names and addresses of the corporation's directors and officers
• The address of the corporation’s registered office in the state
• The name of the corporation’s registered agent there
• A description of the nature of the business

Additionally, Wisconsin corporations must prepare and mail annual financial statements to each shareholder within 120 days after the close of the corporate fiscal year.

Taxes

Wisconsin's corporate tax structure takes a flat bite of 7.9 percent out of all corporate income. Among states levying corporate income taxes, Wisconsin's rate ranks 18th highest nationally.

A “subchapter S” or “S corporation” (frequently referred to as an “S corp”) is treated as a pass-through entity for tax purposes in the same way as a sole proprietorship or partnership. S corp status is recognized by the state of Wisconsin. The S corp does not file a tax return on its own behalf. All tax-related information for the S corp is filed as part of the owner’s individual income tax.