How to Start a Business in North Dakota
North Dakota is home to roughly 72,000 small businesses, representing 99.2% of all employers in the state.
In This Article
The Complete Guide
How to Start a Business in North Dakota — 12 Steps
This is a full walkthrough: entity selection, state registration, federal tax IDs, licenses, banking, insurance, and ongoing compliance. Every step includes the official North Dakota links, fees, and timelines.
Cost depends on your structure. A sole proprietorship may cost nothing to start. An LLC costs $135 to file online. A corporation costs $100. Step 3 walks through every option.
North Dakota: Key Business Facts
Updated: Feb 2026- LLC Filing Fee (Online)
- $135
- Sole Proprietorship / DBA
- $25
- Corporation Filing
- $100
- Processing Time
- 5-10 business days
- Expedited Option
- $100 / 1-2 business days
- State Income Tax
- 1.95% flat rate (2026)
- Sales Tax Rate
- 5%
- Gross Receipts Tax
- No
- Franchise / Annual Tax
- None
- Filed With
- North Dakota Secretary of State
- State Business License
- Not required (check local)
- Last Verified
- February 24, 2026
Local licenses: North Dakota does not require a general state business license. Cities such as Fargo, Bismarck, and Grand Forks require their own local business licenses, so check with your city auditor's office before opening.
What It Takes to Start a Business in North Dakota
Forming a business in North Dakota starts with filing through the North Dakota Secretary of State, which handles entity registrations, name reservations, and annual reports. Most founders choose an LLC, which costs $135 to file.
You will also need a federal EIN from the IRS, any required local licenses, and a registered agent with a physical North Dakota address. This guide walks you through all 12 steps from idea validation to ongoing compliance.
Validate Your Business Idea in North Dakota
Research whether your business idea fits North Dakota's economic strengths before investing time or money. The state's top industries include:
- Energy and oil production (the Bakken Formation drives billions in annual output)
- Agriculture and food processing (North Dakota leads the nation in production of spring wheat, durum, and sunflowers)
- Technology and unmanned aerial systems (the Grand Sky UAS park is a national leader in drone innovation)
Contact the North Dakota SBDC for free one-on-one consulting and market research assistance. Their advisors help you test assumptions and estimate startup costs at no charge.
Pro Tip
Write a Business Plan
Draft a business plan that includes your revenue model, target market, startup costs, and 12-month financial projections. Banks and SBA-backed lenders require a formal plan before approving any loan application.
Use our business plan guide to build a lean, investor-ready document in a single afternoon. Focus on realistic cash flow projections since North Dakota's seasonal economy can impact many industries.
Pro Tip
Choose Your Business Structure in North Dakota
Most founders in North Dakota choose an LLC because it combines personal liability protection with pass-through taxation. Filing an LLC costs $135 at the North Dakota Secretary of State.
The four main structures are sole proprietorship, LLC, S-Corp, and C-Corp. Each has different tax treatment, liability exposure, and paperwork requirements. See the full comparison below, or read our North Dakota LLC formation guide for a detailed walkthrough.
Pro Tip
Business Structure Comparison — North Dakota
Full comparison guide| Structure | North Dakota Filing Cost | Personal Liability | How You're Taxed | Best For |
|---|---|---|---|---|
| Sole Proprietorship | $25 (DBA) | ❌ None | Personal income tax. No separate return. | Freelancers, consultants, side hustles testing an idea with no employees. |
| LLC Most Common | $135 online | ✅ Personal assets protected | Pass-through by default. Elect S-Corp when profitable. | Most small businesses. Best balance of liability protection, flexibility, and tax options. |
| S-Corporation | ~$135 + IRS election | ✅ Personal assets protected | Pass-through. Owners pay themselves a salary — can reduce self-employment tax. | Profitable businesses (typically $50K+ net) where payroll tax savings justify the complexity. |
| C-Corporation | $100 | ✅ Personal assets protected | Corporate tax rate (21% federal). Double taxation on dividends. | Startups planning to raise VC funding, issue stock options, or eventually go public. |
| General Partnership | Free / No State Filing | ❌ None — all partners personally liable | Pass-through. Each partner reports share on personal return. | Two or more owners who trust each other and don't need liability protection. |
Which should you choose? Most first-time founders in North Dakota pick an LLC — it protects your personal assets without the complexity of a corporation. If you're not sure, consult a CPA or business attorney before filing. Read the full North Dakota LLC guide →
Choose and Register Your Business Name
Search the North Dakota business name database to confirm your desired name is not already taken. Your name must be distinguishable from every other entity on file with the Secretary of State.
If you are forming an LLC, the name must include "Limited Liability Company," "LLC," or "L.L.C." If you want to operate under a different name, file a trade name (DBA) for $25 with the Secretary of State.
Pro Tip
Check North Dakota Business Name Availability
Search the official North Dakota Secretary of State database before you file.
Register Your Business with the State
File your Articles of Organization (LLC) or Articles of Incorporation (corporation) through the North Dakota Secretary of State's FirstStop portal. The LLC filing fee is $135, and corporation filing costs $100.
Standard processing takes 5 to 10 business days. Expedited processing is available for an additional $100 and reduces turnaround to 1-2 business days.
Every North Dakota business entity must designate a registered agent with a physical address in the state. See our North Dakota registered agent guide for trusted options and pricing.
Important
File Online with North Dakota Secretary of State
Official North Dakota business registration portal. Standard processing: 5-10 business days.
Get Your Federal EIN from the IRS
Apply for a free Employer Identification Number (EIN) directly on the IRS website. The online application takes about 10 minutes and provides your EIN immediately upon completion.
You need an EIN to open a business bank account, hire employees, and file federal taxes. Even single-member LLCs benefit from having an EIN to keep their Social Security number off business documents.
Pro Tip
Get Your Licenses and Permits in North Dakota
Requirements vary by industry and location, but most North Dakota businesses need:
- Sales Tax Permit — required if selling taxable goods or services; register free at the North Dakota Office of State Tax Commissioner
- City Business License — North Dakota has no general state business license, but cities like Fargo, Bismarck, and Grand Forks require local licenses (contact your city auditor)
- Professional License — required for contractors, healthcare providers, real estate agents, and other regulated fields through the relevant state licensing board
- Employer Registration — required before hiring; register with Job Service North Dakota for unemployment insurance
Pro Tip
Important
Open a Business Bank Account
Bring your EIN confirmation letter, Articles of Organization (or Incorporation), government-issued ID, and your LLC operating agreement to the bank. Most North Dakota banks can open a business checking account the same day.
Keeping personal and business finances separate protects your LLC's liability shield and simplifies tax preparation. Compare top options in our best business bank accounts guide.
Pro Tip
Set Up Accounting and Understand North Dakota Taxes
North Dakota's individual income tax rate is a 1.95% flat rate as of 2026, one of the lowest in the nation. LLCs and S-Corps pass income through to owners, so you pay this rate on your personal return rather than at the entity level.
Register with the North Dakota Office of State Tax Commissioner for sales tax collection if applicable. The state sales tax rate is 5%, and local jurisdictions can add up to 3% more.
Set up accounting software from day one to track income, expenses, and quarterly estimated tax payments. Our accounting software comparison covers the best tools for small businesses.
Pro Tip
Get Business Insurance in North Dakota
North Dakota requires employers to carry workers' compensation insurance through the North Dakota Workforce Safety and Insurance (WSI) agency. This is a state-managed monopolistic fund, meaning you must obtain coverage through WSI rather than a private insurer.
General liability insurance is recommended for all businesses regardless of structure. Compare policies in our business insurance guide to find coverage that fits your industry and budget.
Important
Build Your Online Presence
Claim your free Google Business Profile to appear in local search results across North Dakota. This is especially important in smaller markets like Bismarck and Fargo where local SEO drives foot traffic.
Build a professional website using one of the platforms in our website builder comparison. Even a simple five-page site with your services, location, and contact form can convert local searchers into customers.
Pro Tip
Stay Compliant After Forming in North Dakota
After forming, keep your North Dakota business in good standing by meeting these ongoing requirements:
- Annual Report — due by November 15 each year, filed with the Secretary of State for a fee of $50
- State Tax Filings — file annual state income tax returns and remit sales tax on the required schedule through the Office of State Tax Commissioner
- Registered Agent — maintain a registered agent with a physical North Dakota address at all times
- Business Licenses — renew any city or county licenses on their respective schedules
- Workers' Comp — maintain active coverage through Workforce Safety and Insurance if you have employees
Missing the November 15 annual report deadline results in late fees and potential administrative dissolution. Track all deadlines with StartupOwl's compliance calendar.
Pro Tip
Important
North Dakota Business Background & Context
State-specific data to help you plan — taxes, economy, funding, and what to expect after you form.
Frequently Asked Questions
What to Do Next
Once you've registered your North Dakota business, take these steps to set up for success.
Form Your North Dakota LLC
File your Articles of Organization for $135 and get your business officially registered with the state.
Start Your LLC →
Get a Registered Agent in North Dakota
Every North Dakota LLC needs a registered agent with a physical address in the state. Compare top services.
Compare Agents →
Open a Business Bank Account
Separate your personal and business finances from day one. See which banks offer the best terms for startups.
Compare Accounts →
Explore North Dakota Funding Options
The Bank of North Dakota and SBDC offer unique financing programs not available in other states.
Plan Your Funding →
Get Business Insurance
North Dakota requires workers' comp through its state fund. Compare general liability and other policies.
Compare Insurance →
Disclaimer: This guide is for informational purposes only and does not constitute legal or tax advice. Requirements change — always verify current fees and requirements directly with North Dakota Secretary of State and the IRS before filing.
Ready to Form?
Get your North Dakota business registered with ZenBusiness — choose your structure, file the paperwork, and stay compliant from day one.
About the Author
Director of Entrepreneurial Strategy
Jennifer is a former founder who built and sold a boutique B2B logistics company in her thirties. She understands the emotional and strategic toll of building a business from the ground up without a massive safety net. She is deeply connected to the Atlanta startup ecosystem and is passionate about equitable funding.
Was this article helpful?