Montana LLC – Form an LLC in Montana
A Montana LLC is no different than any regular business or corporation. Forming a Montana LLC to own vehicles or any kind of personal property is nothing different than the local handyman pulling up to your home in a work vehicle owned by “Handyman’s Service LLC” and pulling a trailer with tools in it that are all owned by the Handyman’s LLC.
A Montana LLC can own any kind of property.
Specifically; many people form a Montana LLC to buy RVs, airplanes, cars, trucks, travel trailer, excavators, skid steers, dozers, or just things like paintings.
Why do people buy things with Montana LLCs?
You form an LLC or Corporation at the state level. You could file an LLC in any state. It doesn’t have to be in Montana. But, where you file the paperwork to form that company, establishes that company as a resident in that state. The goal is to have a Montana LLC that is a resident of Montana. Montana has no sales tax, and has great laws on not charging sales and use tax on property that gets a title. So Personal property that has a title, typically doesn’t pay use or sales tax. So if you want to buy a $100,000 RV, and you live in a state with 8% sales tax, you could save a lot of money by forming a Montana LLC, and then having the Montana LLC, as a resident of Montana, buy the RV. This same principle works on buying anything. A Montana LLC is just a normal business entity. It could go into business selling all that stuff you’ve been storing in your closet, or it could exist to just buy stuff and own it. Many massive corporations, holding companies, and public companies form hundreds if not thousands of stand alone LLCs just to own specific assets. A massive company like Toyota, might build a new plant somewhere. They wouldn’t just have their main Toyota company own a massive piece of real estate. They would form a holding company like a LLC to own the building, and then rent the building to Toyota. You’ll notice many people that own a lot of real estate, don’t have one LLC or corporation that owns a lot of places. They’ll form a different LLC for every property.
Should I have multiple LLCs?
Probably not. It’s over-complicating things. Many travelers form one Montana LLC and it buys and owns a RV and a tow car. Or a truck and a travel trailer.
Do I need to live in Montana to own a Montana LLC?
Absolutely not. Do you think all the massive fortune 500 companies live where they incorporate their company? There is no reason whatsoever to be a personal resident of Montana to own a Montana LLC.
Should I get a Montana Drivers License?
This is just plain insanity. Many people form a Montana LLC to buy a vehicle with so they don’t pay sales tax. This is a perfectly normal, regular business activity. Lying about being a personal resident in a state where you don’t live, and using a registered agents address or a mail forwarding address to try to get a personal Montana drivers license is lying to a government agency about where you personally live. Please don’t get duped into trying to get a Montana drivers license. Your Montana LLC will conduct business. Not you.
Should a Montana LLC have a bank account in Montana?
There is absolutely no reason to get a Montana specific bank account for your LLC. If you want a bank account for your Montana Limited Liability Company, just take in the paperwork we give you to your local bank, and you should have no problem whatsoever getting a bank account locally, at a place where you can regularly and easily conduct business with a bank you know. Hiring someone in Montana to get you a bank account sounds shady doesn’t it?
Should I get a FEIN or Tax ID Number for my Montana LLC?
If you’re simply forming a MT LLC to register a vehicle in Montana, it would be insanity to get an EIN and tell the IRS about your new Montana company. If you’re opening up a business in Montana, you’ll absolutely need an EIN just to get started. Shady MT registered agents might recommend you get an EIN and try to act like a normal Montana business. We feel like trying to act more like a Montana business when you actually aren’t a Montana business would make you look worse to a judge in a local county if your local community tries to get you to register locally when you might live. What you’re doing by forming a Montana LLC to own some property is nothing different than massive corporations do. Many agents need to up-sell you to make a living. We take care of our clients with minimal fees just by not losing our clients once we get them. We don’t need to up-sell you on fear.
How would a Montana LLC buy a vehicle?
You place an order File a Montana LLC. We form the Montana LLC the same day. The LLC will then go out and purchase whatever you are wanting to purchase. It’s as simple as putting your Filed Montana LLC name and our address on as the purchaser. You don’t sign a purchase agreement as you, you sign it as a member of your Filed Montana LLC.
How would a Montana LLC sell something or trade it?
When we form a Montana LLC for you, we keep your information completely private and off of state records. We provide internal documents, documenting your personal ownership and membership in your Filed Montana LLC. When you’re ready to sell something or trade it in for a new vehicle, you simply sign the title over as the member. When registering a new vehicle in Montana, if you hire us, we then sign the new registration paperwork, further keeping your information off of Montana State records.
How do I know I own the Montana LLC or what the Montana LLC buys?
If you are forming a Montana LLC to buy an RV, vehicle, or anything and you don’t live in Montana; we automatically file your new MT LLC in a way that keeps your personal name and address off the public records. If you hire us to register your vehicle in MT, we make sure to keep your information off of the vehicle registration paperwork as well. You know you own the Montana LLC by the private organization documents. Anyone can go download a MT LLC articles of organization template from the MT SOS website, and send in a check to form an LLC in Montana. That’s simple. The hard part is your private documents that document your capitalization and exchange of personal assets (money needed for the LLC to buy things) into the LLC to document proof that you now own the LLC. We’ve seen the paperwork of almost every MT registered agent offering MT LLC services. Even most the attorneys charging thousands of dollars don’t really document this exchange very well. If you hire a MT LLC formation company, and they use a default state provided template, ask you to sign something, and can’t show you detailed and well thought out MT LLC operating agreements specific to what you’re actually doing, please run for the hills. Or as we would say, run into the woods. It’s easy to pitch a service to File a Montana LLC on a website, but it’s a specialty to actually form a MT LLC and keep your information private and truly document your ownership in the MT LLC in a way that will make sense to you and for any future dealings you may have while using the MT LLC.
You will own the Montana LLC. You will be the only people that can control the Montana LLC. The Montana LLC will own assets.
How do I get a Montana Address to form a Montana LLC?
We provide you our registered agent address for the requirements needed to form a MT LLC. We also provide the principal address, mailing address, organizer address, and the address to use for registering a vehicle in Montana, getting titles in Montana, and getting vehicle renewals. We charge $49 a year for this service, and this is how we make our living. We do not charge extra to forward on any of these documents necessary to you to register a vehicle in Montana and properly use your Filed Montana LLC.
How do I form a Montana LLC?
- You’ll need a MT registered agent. It’s required to form any kind of business in MT. We include this with all MT LLC orders.
- You could file the LLC yourself. You could simply download the Montana LLC Articles of Organization from the MT SOS website, fill in the required information, and send in a check to the MT SOS for the $70 filing fee.
- OR, you could hire us. For $300, we will file your LLC in 1 day and it includes custom articles (not a state template), resolutions, operating agreement, and LLC membership certificates.
Will a MT LLC pay taxes in Montana?
- Montana has no sales tax, but pretty much every other MT LLC service is based in a county that has a county level vehicle options tax, this can add many thousands of dollars to your purchase and kind of defeat the purpose of forming a Montana LLC to pay no sales tax. We are in Flathead County, and we do not have a county vehicle option tax.
- Montana has income tax, but you shouldn’t be making money with your Montana LLC. You should just be owning titled vehicles. If you decide to make money with your Montana LLC, you might have nexus in Montana. But you really need to be making more than $250,000 a year to really get out of the grey area of Nexus in Montana. Other registered agents might trick you into thinking you need to report a zero income tax return with the Montana Department of Revenue. Maybe you should? But you have no income to report. Our clients do not send in zero income tax returns with the Montana Department of Revenue, and no one has ever gotten in trouble. IF you make money with your Montana LLC, you should file a Montana income tax return though, but your CPA will probably be able to get you out of any actual income tax by saying you don’t have nexus in Montana for income tax purposes.
- Montana has use tax, but not for vehicles or personal property that has a title. So you buy a trailer and you get a title, you don’t pay sales or use tax. You buy a John Deere Gator, you don’t pay use or sales tax because you get a title. You buy a golf cart, you probably won’t get a title, so you could owe “Use” tax. Use tax is charged at the county level as a business personal property tax return. Each county in Montana will ask a business actually working in the county to list it’s assets that aren’t titled and pay use tax. We pay use tax on things like office equipment. If we owned a golf cart for business use to drive to the Flathead DMV, we would pay use tax on it. Many of our clients will buy excavators, dozers, earth moving machines, and very expensive machinery with their Montana LLCS. If they were actually located here and “using” this equipment here, they would pay use tax on it each year. But none of these clients are bringing this non-titled equipment into the county and thus don’t pay use tax.
How do I maintain a Montana LLC?
- You’ll need a Montana registered agent, which we charge $49 a year for, and an agent that specializes in registering vehicles and understanding the complexities of principal addresses, and is willing to let you use their address for vehicles.
- You’ll owe the State of Montana $20 a year for the LLC to keep it in good standing.
- If you register a vehicle, you’ll owe the DMV about $80-$300 a year depending on how new of a vehicle you register.
That’s basically it! It’s super simple to own a Montana LLC and maintain it. Especially with our Montana LLC tools and full service.
How a Montana LLC works for normal Montana businesses:
- A limited liability company in Montana is the simplest way for a person to start an actual business.
- You form a Montana LLC.
- You apply for a Federal Tax ID number.
- Montana LLCs are taxes as a default just the same as an assumed business name, a sole proprietorship, or a doing business as (DBA). Many people will just form a DBA because they think it’s simpler. If you form a DBA, you’ll still get an EIN, and a DBA isn’t a separate actual business entity. You’ll probably end up redoing everything later. Unless you’re wildly successful and have a lot of profit in your first year, you’ll pay no more tax with a MT LLC versus a MT sole proprietorship.
- You get a business checking account.
- Business license. NOT! unless you’re in a professional business or a contracting business, there’s almost no business licensing in Montana.
- Pull the money in, pay for business expenses when you need to buy stuff under the business. If you need something personally or you need personal money, just pay yourself from the business checking account. Your accountant can figure it out at the end of the year. You’ll owe self employment taxes if you show a profit either way.
- Once your accountant meets with you, you can decide if there’s enough profit to elect to have your MT LLC be taxed as an S corporation, pay yourself a wage, and save on self employment taxes.
- Montana LLCs have to file annual reports with the MT 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 SOS website. As your registered agent, we send you reminders and notices about this each year. We can also file this on your behalf if you would like. There are helpful links in your online account showing you where and how to file the MT annual report.
Montana LLC Law, Montana Code Annotated Title 35, Chapter 8 of the Montana Limited Liability Company Act.:
- Title 35-8-107 talks about the powers of a Montana entity operating on its own, independent from the members and managers. Having the ability to sue, and be sued, transact business, make and enter into contracts, sell items, and transfer items, acquire and make purchases, be an owner of another corporation or company, pay what it would like to pay someone or something, and basically operate completely independent of anything else. This is an important function for people forming MT LLCS to own vehicles.
- Title 35-8-2 is for the formation of a Montana LLC.
- Title 35-8-3 is for the limitation of the members or managers liability by solely being a member or manager.
- Title 35-8-6 governs the distribution of LLCs and states that if no agreement has been formally entered into, that the entity will distribute profits evenly according to the percentage of capitalization. Most people forming a Montana LLC to own personal property do not have profits to distribute.
If you would like our help forming a limited liability company for you, we would be honored to help you start your business or holding company.