Guide to Forming an LLC in Mississippi

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Updated December 20, 2022

Follow our free guide to form an LLC in Mississippi

Swyft Filings offers a comprehensive guide for starting an LLC in Mississippi, divided into two main phases to help you better understand the complete LLC formation process.

Pros and Cons of Forming an LLC in Mississippi

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Pros

Low Start-Up Costs Compared to other states, starting an LLC in Mississippi costs very little — the filing fee is only $50 and the state does not charge businesses to file an annual report.

No Corporate/Franchise Taxes Mississippi does not impose any corporate or franchise tax on LLCs. The only taxes owed on the LLC’s revenue is the personal income tax paid by the members.

Low Income Tax Rate Mississippi has one of the lowest income tax rates in the country; even with its tiered tax scale, the highest rate is only 5%.

Cons

Less Privacy for Owners Mississippi requires full disclosure of an LLC’s members in the annual report.

Lagging Economy Mississippi’s economy has seen slow growth when compared to the rest of the nation; the state’s three major metropolitan areas experienced less than one percent growth versus an average 2.1% increase in other metro areas around the US.

Cost of Doing Business

  • $50 filing fee / $0 annual report

  • No corporate or franchise tax

Phase One: Starting Your Mississippi LLC

Starting an LLC in Mississippi can be done without much stress, especially when you have experienced and professional assistance.  You can begin the process with these steps:

Step 1: Name Your Mississippi LLC

A good business name is important, and it is the first thing you should do for your Mississippi LLC. As you begin this important step, be aware of government regulations (state and federal) concerning the use of certain words in business names.

Tip: Use a free business name search tool to ensure your company’s desired name is available.

Business Name Guidelines

  • The official name of your business must end with: Limited Liability Company, Limited Company, LLC, or L.L.C.

  • Your business name cannot be intentionally misleading to consumers

  • The name of your new LLC must not be similar to another organization’s name/trademark

Restrictions

  • “Lottery” and “Bank” are ineligible for use (any state)

  • Terms that represent educational or Veterans’ organizations are restricted

  • Terms related to the Armed Forces or civil servants (police, EMT, fire)

LLC business names associated with government and/or financial entities are not always restricted - it depends on the state. Additional paperwork may be required.

URL Availability In addition to choosing a name for your LLC, you should also check domain name availability for your business website.

Step 2: Establish Ownership

The owners of an LLC are actually called members and managers.  The difference in title depends on the management structure of the business.

Please note: While all LLCs will have members, only some businesses will also have managers.

LLC Management Structures:

  • Member-managed: All members participate in operating and making decisions for the LLC

  • Manager-managed: An appointed manager oversees the daily operations of the LLC and the members are not actively involved. 

Mississippi LLC Member Guidelines:

Required Number of Members There must be at least one member or manager to form an LLC in Mississippi.

Member Disclosure Requirements An organizer/authorized representative may sign and file the Certificate of Formation in place of the LLC members.

Age Restrictions LLC members in Mississippi may be of any age.

Residence Restrictions There are no residency restrictions imposed on LLC members in Mississippi.

Step 3: Find a Registered Agent in Mississippi

LLCs formed in Mississippi are required to appoint a registered agent. This position must be filled for your business to be official.

What is a registered agent? A registered agent is a person or business who is authorized to accept official mail and service of process notices for the LLC.

Why do you need a registered agent? You are required by law to appoint a registered agent so that the state and federal government has a consistent contact person for your LLC.

What are the main requirements for a registered agent?

  • The registered agent must use a physical address — not a P.O. Box

  • The registered agent must be available during regular business hours

Who can be a registered agent in Mississippi?

  • A state resident with a physical address in Mississippi

  • An LLC or corporation that is licensed to conduct business in Mississippi

Is the registered agent’s contact information publicly accessible? The name and contact information of the LLC’s registered agent is a matter of public record.  

Can I be my own registered agent for my business? You are legally allowed to be your own registered agent as long as you have a physical address in Mississippi.

Is being my own registered agent discouraged? Since the registered agent’s name and address are publicly listed, LLC business owners who choose to be their own registered agent risk compromising their personal information.

Tip: Avoid the hassles and choose Swyft Filings to fill the registered agent needs for small businesses in Mississippi. Find more information here.

Step 4: File the Certificate of Formation

To official create your Mississippi LLC, you will need to file the Certificate of Formation with the Secretary of State.

What is the Certificate of Formation? The Certificate of Formation is a legally binding document that officially and legally forms your LLC with the Secretary of State.

Why do I need the Certificate of Formation? You need a Certificate of Formation because your LLC in Mississippi will not be legally recognized by the Secretary of State without this document.

What information is included in the Certificate of Formation?

  • The name and address of the LLC

  • The name of the organizer filing the paperwork

  • The name and location of the registered agent

  • The nature/type of business

Additional Mississippi Filing Information - Professional LLCs

Mississippi allows professional service businesses to form a Professional Limited Liability Company (PLLC).

Examples of Professional Service Businesses:

  • Accountants

  • Attorneys

  • Physicians (general, surgeon, podiatrist, dentist, optometrist, chiropractor, physical therapist)

  • Professional Counselors and Psychologists

  • Architects and Engineers

  • Veterinarians

  • Social Workers

A few points to consider:

  • All members of the PLLC must be licensed in the profession of the business.

  • The PLLC is only allowed to provide services for which the business was formed.

  • The members are still subject to whichever licensing boards govern the PLLC’s profession.

Step 5: Create an LLC Operating Agreement

Mississippi state law does not require an LLC Operating Agreement; however, this document is still considered vital to the successful formation and continuation of any LLC business.

What is an LLC Operating Agreement? The LLC Operating Agreement is an in-house legal document that defines the roles of the parties involved in the business and identifies overall operating procedures.

Why do I need an LLC Operating Agreement? The LLC Operating Agreement is necessary for your business because it adds stability, protects business assets, and reduces disputes among members.

Do I need to file the LLC Operating Agreement? You do not file the Operating Agreement anywhere because it is for your LLC and remains in-house. 

What goes into an LLC Operating Agreement? Most LLC Operating Agreements will include the following information:

  • List of the members/managers and their roles

  • Designation of authority in the LLC

  • Initial capital contributions of the members

  • Voting designations and percentages of the members

  • Member transfer/addition rules and restrictions

  • Distribution of profits

  • Meeting schedule

Tip: Get a customized LLC Operating Agreement for your small business with Swyft Filings. Add structure to your LLC now.

Step 6: Register for an EIN

Most businesses formed in Mississippi are required to have an EIN. You will not be able to conduct business without it.

What is an EIN? EIN stands for Employer Identification Number; it is a nine-digit number that the IRS assigns to your business for identification purposes. The EIN is also known as a Federal Tax ID.

Are all businesses required to have an EIN? Federal law dictates that certain types of business entities register for an EIN:

  • Any business with employees (even if owned by one person)

  • Any business with more than one member

  • A partnership (LLC or C-corp)

Please Note: A sole proprietorship is not required to have an EIN, but it is still recommended.

Why does my LLC business need an EIN? The more common reasons you would need an EIN are:

  • To hire employees

  • To open a bank account in the U.S.

  • To file your company’s taxes

  • To pay independent contractors

In short, if you make money through your business and it has employees, you must have an EIN.

Is the EIN publicly listed? The EIN for your LLC will be part of public record.

Can I use my Social Security Number as the EIN? If you are a sole proprietorship who wants an EIN for your business, you can elect to use your social security number; however, your EIN is part of public record.

Swyft Filings offers EIN services for small businesses in Mississippi. Find more information here.

Phase Two: Maintaining Your Mississippi LLC

The second phase of creating your Mississippi LLC involves making your business compliant with state regulations. The next few steps are:

Step 1: Register for Mississippi State Taxes

Mississippi does not require LLCs to pay a corporate or franchise tax. Members must still pay state and federal income taxes on their earnings.

State Income Taxes The state income tax rate for Mississippi is on a tiered scale that ranges from 3% to 5% — see chart below:

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Corporate Tax Information You can also choose to have your LLC taxed as a corporation; if so, your business will be responsible for paying both a corporate income tax and a franchise tax.

The franchise tax is based on either the total capital used/invested/employed in the state OR the total value of the business’s property in the state. The tax rate is 0.25% or $2.50 per $1,000. The minimum franchise tax fee due is $25.

The corporate tax rate is on a tiered scale that ranges from 3% to 5% — see chart below:

Reference Image

Additional Tax Information Other taxes your LLC may need to pay:

  • Sales and Use Tax at 7%

  • Employee Withholding Tax

  • Unemployment Tax

Step 2: Obtain Business Licenses and Permits

The licenses and permits required for an LLC in Mississippi can vary, depending on a number of variables:

  • Location (city and county)

  • Type of Business

  • Industry

Tip: If you would like to see more in-depth information on licenses and permits, please feel free to visit the content in our learning library that covers business licenses and permits.

Step 3: File an Annual Report

All Mississippi-formed businesses must file an annual report with the Secretary of State.

What is an annual report? An annual report is a legal form that is filed with the Secretary of State to keep your business’s information current with the state.

What kind of information is in the annual report? The information requested in the annual report is similar to what is in the Certificate of Formation:

  • The name and address of the business

  • The name and address of the registered agent

  • The NAICS code (identifies LLC’s industry)

  • The EIN

  • The LLC members/managers

Is the annual report part of public record? The annual report filed on behalf of your LLC is a matter of public record.

Fees and Due Date

Fee: $0 Due Date: April 15th Implications of Late Filings:  Dissolution of LLC

Swyft Filings helps you stay compliant by providing stress-free solutions. File your annual report with us today.

Step 4: Request a Certificate of Good Standing

Once your Mississippi LLC has been all set up, your last step is to obtain a Certificate of Good Standing for your business.

What is a Certificate of Good Standing? The Certificate of Good Standing is an official notification to confirm that your business is compliant with all state regulations.

Who issues the Certificate of Good Standing? The Certificate of Good Standing is issued by the Secretary of State.

When can I request a Certificate of Good Standing for my business? You may submit your request for a Certificate of Good Standing anytime after your LLC is officially formed.

Why do I need a Certificate of Good Standing? Having a Certificate of Good Standing provides assurance to businesses and financial institutions that your LLC is in good standing with the state government.

Additionally, some states require a Certificate of Good Standing before a business can apply for Foreign Qualification.

Does the Certificate of Good Standing have an expiration date? The Certificate of Good Standing does not expire/does not need to be renewed.

Swyft Filings can create a Certificate of Good Standing for your Mississippi LLC. Click here for more information.

Additional Mississippi Resources

Originally published on December 20, 2022, and last edited on December 20, 2022.

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