Incorporate in Montana
Montana corporations are governed by the Montana Code Annotated Title 35 Chapter 1 of the Business Corporations Act.
A Montana corporation costs $70 to incorporate in Montana with the Montana Secretary of State.
It will take about 10-15 business days to get processed by the state, or one day if you pay an extra $70 priority fee to us, or an extra $150 for an expedite one-hour service fee.
We have an account with the Montana Secretary of State, so we can file the custom-drafted Articles of Incorporation we prepare for you immediately upon signing up here. If you are in a super big hurry and want to pay the Montana State’s extra $150 one-hour fee, you’ll literally have filed, stamped Articles of Incorporation and an active Montana corporation in 1-2 hours.
We form Montana corporations every day, and we’re usually half the price of any of our competitors.
A Montana corporation with our price will cost you:
|$224||10-15 business days|
|$294||1 business day|
Our Montana incorporation service includes:
- Custom-drafted Articles of Incorporation.
- Standard corporate bylaws written specifically for Montana corporations.
- Initial resolution made by incorporator appointing directors and officers.
- One year of our $49 Montana registered agent service. The cheapest, no-hidden-fee, most inclusive registered agent service you’ll find anywhere.
- You’ll have the owner or our in-house, non-practicing attorney do the filing for you.
- Online account for your documents.
- Annual report reminders.
There’s always a couple other options like tax ID number, Department of Revenue registration, license obtainment, etc… that you can add on. You can see those options on our 1-page, 5-minute sign up form.
I would like to highlight a couple of items of interest for a Montana corporation:
- Montana corporations are automatically C-corporations with the IRS, and must be elected into the S-corporation status. This is an easy process. We can do it for you, or you can do it on your own. The IRS would like you to make the corporation an S-corp within 3.5 months of formation, or the first 3.5 months of a new year.
- The corporate income tax rate for Montana corporations is 6.75% with a $50 minimum tax return payment. If you elect to be an S-corporation, you’ll be paying income tax at the personal level on the amount of leftover profit at the end of the year. Here’s the personal income tax rates for Montana:
|Personal Income Tax Rates|
- The Montana S-corporation gives you the flexibility of paying yourself a W-2 wage, and then trying to pay yourself distributions to avoid the self-employment tax of 15%.
- You can also do this with a Montana LLC.
Let me explain the big 15% tax savings everyone talks about with an S-corp (it’s not as big as you may think):
- If you are an S-corporation, you have to pay yourself a “normal” wage in the view of the IRS. When paying yourself a wage, you have payroll reports, withholdings, etc.
- Let’s say you had $40,000 of net income you had to pay taxes on one year. You paid self-employment tax on it. The next year, you made your corporation an S-corp, and paid yourself a wage of $30,000 a year, because that would be about normal for someone running your type of company. You took the $10,000 as a distribution or dividend and you avoided the Social Security and Medicare tax on that $10,000. You also avoided as a business doubling that tax you withheld out of your employee paycheck and sending it to the IRS. So for $10,000, you saved $1,500 bucks. That can add up, but your first year of keeping all that straight and running those numbers through an accountant will cost you more than that in time and bills from your CPA. Long-term, it should be a savings for you to be an S-corp. An LLC is simpler for a person just starting out.
- Montana has no sales tax, thus a lot of people form Montana corporations or LLCs to hold assets they purchase and avoid the sales tax. For information on vehicle licensing, see our Montana RV LLC Service.
Generally speaking, people that form Montana corporations as holding companies are not trying to take advantage of gains or losses on their taxes, and thus aren’t concerned with filing tax returns or income tax percentages.
- Montana corporations have to file annual reports with the Secretary of State every April 15th. They cost $20 and are basically just an informational update opportunity. They will take you about 5-10 minutes to file on the Montana SOS website. As your Montana registered agent, we send you reminders and notices about this each year. We can also file this on your behalf if you would like. The Montana corporate tax return has a $50 minimum payment as well, even if your net corporate income tax is less than $50.
- Montana also is one of the states with the bonus option of a close corporation.
A Montana close corporation can be elected if there are 25 or fewer shareholders. We recommend that small businesses use the close corporation election.
A Montana close corporation can:
- Eliminate the board of directors, thus giving the power to the shareholders (which they have in a normal corporation, it’s just a little less of the formalities).
- Eliminate the need for an annual meeting.
- Eliminate the need to have multiple people sign documents that typically would ask for a different person to be the President, Secretary, or Treasurer of the corporation.
- A Montana close corporation still provides the limitation of liability for the shareholders, officers, and acting directors that a normal Montana corporation would provide.
If you would like your Montana corporation to be a close corporation, please make a note of that on the special notes section of our sign up form.
If you would like our help incorporating your Montana corporation, we would be honored to help you get your new business going. Thank you for the opportunity to help you.