How to Start a Corporation in Montana

How to Start a Corporation in Montana

How to Start a Corporation in Montana

Forming a corporation in Montana is a straightforward process that takes roughly 1 to 7 business days, depending on how much you're willing to pay for speed. You'll file articles of incorporation with the Secretary of State, appoint a registered agent, and pay a $35 filing fee. This guide walks you through each step, the exact costs, and what to expect after you file.

Corporation vs. Other Business Structures

Montana lets you choose between three main business structures: sole proprietorship, limited liability company (LLC), or corporation. A corporation is a separate legal entity from its owners (called shareholders). It can sue and be sued in its own name, sign contracts, and own property. You'll pay $35 to form it, plus annual compliance costs.

An LLC also costs $35 to form and offers liability protection, but it's simpler to run and typically cheaper to maintain. A sole proprietorship costs nothing to form legally, but you're personally liable for all business debts and lawsuits. If you're forming a traditional business with multiple owners and plan to eventually seek investment or sell the company, a corporation is often the right choice. If you're a solo operator or small partnership, an LLC is usually easier.

This article focuses on C corporations (standard profit corporations). S corporations exist in Montana but are a tax election you make with the IRS after forming a C corporation, so they're not covered here.

Step-by-Step: How to Form a Corporation in Montana

Step 1: Choose a Corporate Name and Check Availability

Your corporation name must include one of these words or abbreviations: corporation, corp., incorporated, inc., company, co., or limited. The name must be distinguishable from any other registered corporation, LLC, nonprofit, limited partnership, or LLC name already on file with Montana's Secretary of State.

Search the business name database for free at https://biz.sosmt.gov/search/business. Type your intended name and see if it's available. If it is, you can reserve it for 120 days for a $10 fee, giving you time to prepare your articles and gather information.

A few naming rules: the name cannot state or imply the business is something other than a corporation. It cannot include misleading words like "bank" or "insurance" unless you're actually licensed. And it must use standard characters, no special symbols (other than &, -, and single quotes in specific positions).

Step 2: Reserve the Name (Optional)

Name reservations last 120 days and cannot be renewed. You reserve one by filing a "Reservation of Corporate Name" form with the Secretary of State through https://biz.sosmt.gov. The cost is $10. This is optional, but useful if you need time to gather other information (like your registered agent's consent) before filing your articles.

Step 3: Choose and Confirm Your Registered Agent

Montana law requires every corporation to have a registered agent. This is a real person or business (like a registered agent service) with a street address in Montana where legal papers can be delivered. Your registered agent is your point of contact for lawsuits, regulatory notices, and official government mail. The registered agent's address becomes public record.

You can name yourself (if you live in Montana) or a registered agent service. Commercial registered agent services cost roughly $50 to $200 per year, depending on the provider. Your registered agent must consent to serve (you'll check a box in the filing confirming they have).

Many startup-focused services (like Northwest Registered Agent or LegalZoom) offer Montana registered agent service. Some banks and law firms also provide it. The key requirement is that the address be a real Montana street address, not a P.O. box, and that the agent be reachable during business hours.

Step 4: Prepare Your Articles of Incorporation

The formation document is called "Articles of Incorporation for Domestic Profit Corporation." Montana's Secretary of State does not provide a mandatory form, but you can download a template from https://sosmt.gov/business/ for reference, or draft your own. Many small businesses use a simple template because Montana's statute does not require extensive language.

Your articles must include these items:

  • The corporate name (exactly as you want it registered)
  • The street address of your initial registered office in Montana
  • The name and street address of your initial registered agent
  • The name and address of the incorporator (the person filing, usually you)
  • The number of authorized shares (if you want to issue stock)

You can also include optional provisions, like whether your board can be changed without shareholder approval, or whether cumulative voting is permitted. If you're unsure what to add, a simple articles template with just the required items works fine.

Step 5: File Your Articles with the Secretary of State

File your articles online through the Montana Secretary of State business filing portal at https://biz.sosmt.gov. Upload a PDF or image of your signed articles, pay the $35 filing fee by credit card, and submit.

Standard processing takes 1 to 7 business days. Montana does not publish a specific turnaround time, but you can speed this up: pay an extra $20 for 24-hour priority handling, or $100 for 1-hour expedite filing. Both are add-ons to the $35 base fee.

You'll receive a confirmation email with a file number once your articles are accepted. Keep this file number for your records.

Step 6: Get Your EIN (Employer Identification Number) from the IRS

Even if you won't have employees, you need an EIN to open a business bank account and file tax returns. You can apply for free at https://www.irs.gov/ein, by phone (1-800-829-4933), or by mail. Online applications are approved immediately.

Step 7: Open a Business Bank Account

Bring your articles of incorporation (the filed copy from the Secretary of State), your EIN letter, your ID, and any initial funding to a Montana bank. Some banks may ask for a corporate resolution authorizing the account, or a copy of your bylaws, though many don't. Using a business account keeps your personal and business finances separate, which protects your personal liability shield.

Step 8: Set Up Your Corporate Records

You don't have to file bylaws with the state (unlike the articles), but you should draft them for internal use. Bylaws outline how your corporation operates, how directors and shareholders meet, when elections happen, and other governance details. They're required by Montana law even if you don't file them. You'll also want to hold an initial directors' meeting to appoint officers, authorize bank accounts, and handle other startup decisions. Write down what happened at that meeting (minutes).

Costs Breakdown

Here's what you'll pay to incorporate in Montana:

Item Cost Notes
Name reservation (optional) $10 120 days, nonrenewable
Articles of incorporation filing $35 Standard processing
24-hour priority handling (optional) $20 Add-on fee
1-hour expedite filing (optional) $100 Add-on fee
Registered agent service (annual) $50 to $200 If using a commercial service; optional if you serve yourself
EIN application Free Through IRS

A bare-minimum incorporation (no name reservation, no expediting, serving as your own registered agent) costs $35. If you use a registered agent service and want 24-hour handling, you're looking at around $55 to $255, depending on your choices. Most businesses pay $35 to $75 for the initial filing alone.

Timeline and Processing

Here's what to expect:

  • Filing to approval: 1 to 7 business days (standard), or 24 hours (priority), or 1 hour (expedite)
  • After approval, EIN issuance: Same day (online) to 2 to 3 weeks (by mail)
  • Bank account opening: 1 to 3 business days after you apply

From start to finish, you can have a functioning corporation with a bank account in as little as one business day if you pay for expedited filing and apply for your EIN online. Most businesses take 5 to 10 business days.

Montana Registered Agent Requirements

Your registered agent must have a street address in Montana and be available during regular business hours to accept service of process and other documents. Montana law says the agent is either a commercial registered agent service (which lists an address of a place of business in Montana) or a noncommercial agent (a real person with a Montana address). A P.O. box doesn't work.

Your registered agent doesn't need to be an attorney or accountant, and they can be you (if you're in Montana), an employee, a co-owner, or a professional service. Changing your registered agent or registered office costs nothing: file a Statement of Change with the Secretary of State at no fee.

Annual Compliance Obligations

After you incorporate, you'll have ongoing requirements:

Annual Report: Montana requires all corporations to file an annual report by April 15 each year, beginning the year after formation. The fee is waived for 2026 and 2027. Normally, filing by April 15 costs $20, and filing after April 15 costs $35. File online at https://biz.sosmt.gov.

Corporate Records: Keep a registered office in Montana and maintain corporate records (articles, bylaws, board minutes, stock ledger) at that office. You don't need to file bylaws with the state, but you must have them and follow them.

Directors and Officers: You must have at least one director and one officer (president, secretary, treasurer). They can be the same person. You don't name them in the articles; they're elected by the board or shareholders.

Montana Taxes on Corporations

Montana has no LLC franchise tax and no separate annual corporation tax, but corporations do pay income tax. Here's the breakdown:

Corporate Income Tax: C corporations pay a flat 6.75% tax on Montana taxable income, with a $50 minimum tax per year. If your corporation has no Montana income, you still owe $50. S corporations (a tax election, not a business structure) pay the same rate if they don't qualify for a special election.

Pass-Through Taxation (Electing S Treatment): If your corporation elects S corporation status with the IRS, Montana taxes pass through to the owners' personal returns at the personal income tax rate: 4.7% on the first $21,100 of ordinary income (2025 rates) and 5.9% above that for single filers. This is usually cheaper than the corporate rate if you're taking profits out of the company.

No State Sales Tax: Montana has no state sales tax, which is a significant advantage for some businesses. Some municipalities may have local sales or lodging taxes, so confirm with your city or county.

Federal Taxes: You'll file a federal corporate income tax return (Form 1120) and pay federal income tax on profits, even if you elect S status. Federal tax law is separate from Montana state tax law.

This is informational content, not tax advice. Consult a CPA or tax attorney to understand what you'll owe based on your specific income and business structure.

Common Mistakes to Avoid

Forgetting the registered agent: You cannot file without one, and you cannot remove one without naming a replacement. Changing it costs nothing, but leaving the position empty can cause legal documents to go undelivered.

Naming the corporation after yourself: The name must clearly indicate it's a corporation (use Corp., Inc., or the full word). "John Smith Consulting" won't work; "John Smith Consulting Inc." will.

Mixing personal and business finances: Use your business bank account, not a personal one. Commingling funds can lead to piercing the corporate veil, meaning creditors or plaintiffs can go after your personal assets.

Skipping bylaws or corporate records: They're not filed with the state, so it's easy to skip them. Don't. Courts and the IRS may question whether you're really operating as a corporation if you have no documentation of governance.

Assuming you're a sole proprietor: After incorporation, you're no longer a sole proprietor. You'll file a corporate tax return, hold shareholder meetings, and maintain the formal structure. If you want no formality, an LLC might suit you better.

Missing the April 15 annual report deadline: If you file late, you'll pay an extra $15. If you don't file at all for a few years, the Secretary of State may dissolve your corporation, which can cause serious problems for taxes and liability. Set a calendar reminder.

When to Hire a Professional

You can incorporate yourself for $35 and have it done in days. But a lawyer or accountant can help with:

  • Deciding whether a corporation, LLC, or S corporation is best for your tax and liability situation
  • Drafting bylaws that fit your business goals and ownership structure
  • Handling registered agent and office details if you want someone else to manage them
  • Filing with the Secretary of State if you want someone else to handle the paperwork
  • Setting up your corporate records and holding your initial board meeting
  • Planning your tax strategy and quarterly estimated payments

A basic incorporation package from a law firm typically costs $300 to $800. Using an online service like Northwest Registered Agent or a legal document service costs $100 to $300. A CPA can handle tax planning and file your annual returns for $500 to $1,500 per year. None of these are required, but they can save you headaches and mistakes.

Next Steps After You Incorporate

Once your articles are approved, follow this checklist:

  1. Get your EIN from the IRS (free, online or by phone)
  2. Open a business bank account with your articles and EIN letter
  3. Draft and adopt corporate bylaws
  4. Hold an initial board meeting and document it in minutes
  5. Get business licenses from your city or county (requirements vary by location and industry)
  6. Register for state taxes if applicable (sales tax, payroll withholding)
  7. File your first annual report by April 15 of the following year
  8. Plan your quarterly estimated tax payments if you're taking profits out

For regulated industries (alcoholic beverages, cannabis, food service), check with the Montana Department of Revenue at https://revenue.mt.gov/ for additional licensing requirements.

Resources

Disclaimer

This article is informational and describes the general process for incorporating in Montana as of 2026. It is not legal or tax advice. Incorporation laws, tax rates, and requirements can change. Before incorporating, especially if your situation is complex (multiple owners, substantial initial funding, regulated industry), consult a qualified Montana business attorney or certified public accountant. A professional can review your specific circumstances and ensure you're making the right choice for your business.