Form a S-Corp in North Dakota
Everything you need to know about forming a S-Corp in North Dakota. Filing fees, requirements, timeline, and step-by-step guidance.
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How to File
Choose a Corporate Name
Select a unique business name that complies with North Dakota naming requirements, including a required corporate designator such as 'Incorporated,' 'Corporation,' 'Company,' or an abbreviation thereof. Use the North Dakota Secretary of State's online business search tool to verify name availability before filing.
30 minutes
Appoint a Registered Agent
Designate a registered agent with a physical street address in North Dakota who is authorized to receive legal and official documents on behalf of the corporation. The registered agent can be an individual resident or a registered agent service authorized to do business in the state.
1-2 hours
File Articles of Incorporation
Prepare and file Articles of Incorporation with the North Dakota Secretary of State, either online through the FirstStop portal or by mail. The document must include the corporate name, registered agent information, number of authorized shares, and incorporator details, along with the $100 filing fee.
1-2 hours
Create Corporate Bylaws
Draft corporate bylaws to govern internal operations, including rules for shareholder meetings, director responsibilities, officer roles, and voting procedures. While North Dakota does not legally require bylaws to be filed with the state, they are essential for internal governance and maintaining corporate status.
2-4 hours
What's Next After Filing
Once your S-Corp is officially formed, you'll want to complete these important steps:
- •Hold an Organizational Meeting — Conduct an initial organizational meeting of the board of directors to adopt the bylaws, appoint officers, authorize the issuance of stock, and handle other initial corporate matters. Document all decisions with formal meeting minutes.
- •Obtain EIN and File IRS Form 2553 — Apply for a federal Employer Identification Number (EIN) from the IRS, then file IRS Form 2553 (Election by a Small Business Corporation) to elect S-Corporation tax status. All shareholders must consent to the S-Corp election, and the election must be filed no later than 2 months and 15 days after the beginning of the tax year it is to take effect.
- •Register for State Taxes and Licenses — Register with the North Dakota Office of State Tax Commissioner for applicable state taxes, including state income tax withholding if the corporation has employees, and obtain any required local or state business licenses or permits relevant to your industry.
Advantages
- ✓Pass-through taxation avoids double taxation, with income and losses flowing directly to shareholders' personal tax returns and no entity-level federal income tax.
- ✓Shareholders who are active in the business can reduce self-employment tax liability by splitting compensation between reasonable salary and S-Corp distributions.
- ✓North Dakota has no state franchise tax on S-Corporations, reducing the ongoing tax burden compared to many other states.
- ✓S-Corporation status provides personal liability protection for shareholders, shielding personal assets from business debts and legal judgments.
- ✓Perpetual existence and the ability to transfer ownership through stock sales make it easier to attract investors and plan for business succession.
Considerations
- •S-Corporations are limited to 100 shareholders, all of whom must be U.S. citizens or resident aliens, and only one class of stock is permitted, restricting flexibility in raising capital.
- •The IRS requires S-Corp shareholder-employees to pay themselves a reasonable salary before taking distributions, adding payroll administration complexity and costs.
- •S-Corporation status requires strict compliance with corporate formalities such as annual meetings, minutes, and bylaws, which demands more administrative effort than simpler structures like sole proprietorships or single-member LLCs.
Annual Obligations
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