--- title: "Moving from an EOR to Your Own Entity in Minnesota" description: "How employers move from an EOR to a Minnesota entity: formation, payroll transition, tax registration, and when Teamed's GEMO service helps." canonical: https://www.teamed.global/country-hiring-guides/united-states/minnesota/moving-from-eor-to-your-own-entity --- ![Minnesota business district.](/cluster-assets/country-hiring-guides/united-states/minnesota/moving-from-eor-to-your-own-entity/images/hero.webp) # Moving from an EOR toyour own entity in Minnesota. Teamed sets up your Minnesota LLC or corporation, transfers employees onto your new entity's payroll, and hands over a fully compliant operation. Served by Teamed US Inc., Delaware · Payroll via SUNA Solutions Last reviewed 22 September 2026 · Minnesota guide At a glance ## Minnesota entity setup at a glance Forming an LLC in Minnesota means filing Articles of Organization with the Secretary of State for a $155 fee. Once your entity operates and earns income in the state, it becomes subject to Minnesota's corporate franchise tax, currently set at 9.8%. Neither figure changes how an EOR works day to day, but both matter once you decide to run payroll under your own name in the state. Corporate income tax9.8% Formation / registration fee$155 The process ## How the move actually works Moving off an EOR in Minnesota is a sequencing exercise, not a single event. You form the legal entity first, register it with the relevant state and federal tax authorities, open payroll and benefits accounts, and only then transfer employees over, ideally without a gap in their pay or coverage. Teamed runs this as a managed handover rather than leaving you to coordinate lawyers, accountants, and payroll providers separately. Employees keep working through the transition, contracts get reissued under your new entity, and your team ends up owning something that already runs, instead of inheriting a half-built setup. Formation ## Setting up your entity in Minnesota Most employers choose an LLC or a corporation, and Minnesota's Secretary of State handles formation through the Articles of Organization filing, which carries a $155 fee. That filing establishes the legal entity, but it is only the first step, since you still need state tax registration, an employer account for payroll withholding, and often a registered agent with a physical Minnesota address. None of this is technically hard, but it is easy to get the order wrong, register for the wrong tax accounts, or miss a step that only surfaces when you run your first payroll. Teamed handles the filing and the registrations as one sequence so nothing gets skipped. Tax and compliance ## What changes once you have your own entity Under an EOR, the EOR entity carries the employer tax and compliance burden in the state. Once you have your own Minnesota entity, that responsibility moves to you, including Minnesota's corporate franchise tax on income earned in the state, which sits at 9.8%. That is a real, ongoing filing obligation, not a one-time cost, so it belongs in the same conversation as headcount and hiring plans, not treated as a footnote after the entity is already formed. Timing ## When it makes sense to switch There is no fixed headcount where an EOR stops making sense and your own entity starts. It depends on how many people you employ in Minnesota, what they earn, and how long you plan to keep hiring there. A small, stable team can sit comfortably on an EOR for years; a fast-growing one can cross the economic line much sooner. Rather than guess, run the numbers through the crossover calculator, which weighs your actual salaries and timeline against entity setup and running costs. It gives you a straight answer instead of a rule of thumb. The honest answer ## When an EOR is still the right call Not every team in Minnesota should be rushing toward entity setup. Teamed GEMO ## Your own entity, when it's time. We set it up, migrate you in, and hand it back intact. This is what Teamed calls Global Entity and Employment Operations, which we call GEMO once you know the term. We build the entity, run it alongside your existing EOR arrangement, and migrate employees across when you are ready, across 100+ countries, so the process looks the same wherever you are hiring. Before you commit ## Sometimes an employer of record is the better fit An employer of record is a fair, sensible choice while your Minnesota headcount is small or still shifting, or while you are testing whether the market is worth a permanent commitment. Talk to a member of the team about where you actually stand, and run the crossover calculator before assuming your own entity is the next logical step. Contractors, employer of record and your own entity all run on one platform at Teamed, so moving between them later does not mean changing provider or re-onboarding anybody. Real HR and legal experts handle the work rather than a ticket queue. Talk to a member of the team and we will tell you plainly which one suits where you are. If you would rather look at the numbers yourself first, the crossover calculator models it on local salaries and employer costs rather than on a headcount rule of thumb. Talk to a member of the team Model the crossover for the United States Who carries it ## Your own entity, when it's time. We set it up, migrate you in, and hand it back intact. Global Entity and Employment Operations, which we call GEMO, is how Teamed forms your company, registers it for tax and payroll, runs it month to month and keeps its filings current, across 100+ countries. You stay the employer. We do the work behind it. In Minnesota specifically, that means we handle the Secretary of State filing, the tax and payroll registrations, and the employee transfer, then hand you an entity that already meets its franchise tax and filing obligations, not a shell you still need to finish setting up. Entity Management (GEMO) The Graduation Model Employer cost calculator > They set up our EU entity and moved hires across without missing a payroll. *Helene Dubois, COO* Talk to an expert about Minnesota Questions ## Frequently asked questions How much does it cost to form an LLC in Minnesota? Filing Articles of Organization with the Minnesota Secretary of State carries a $155 fee. That covers the legal formation itself; tax registrations and payroll setup are separate steps that follow. What tax rate applies to a Minnesota entity's income? Minnesota charges a corporate franchise tax of 9.8% on income earned in the state. This applies once you operate under your own entity rather than through an EOR. How do we know if we should stay on an EOR in Minnesota? It depends on your headcount, salaries, and how long you plan to keep hiring in the state, not on a fixed number of employees. Run the crossover calculator or talk to a member of the team to see where you actually land. Do employees notice the transition from EOR to our own entity? Done properly, they shouldn't experience any gap in pay or benefits. Teamed sequences the entity setup, registrations, and employee transfer so payroll continues without interruption. Can Teamed manage the entity after it's set up? Yes, through GEMO, Teamed can run the entity alongside your EOR arrangement during transition and then hand it back to you fully operational, or continue supporting it depending on what you need. Where these figures come from ## Sources Figures on this page come from the Minnesota Department of Revenue and the Minnesota Secretary of State. ## More on entities in Minnesota - [Hiring in Minnesota, overview](/country-hiring-guides/united-states/minnesota)parent - [Minnesota setting up](/country-hiring-guides/united-states/minnesota/entity-setup)sibling - [Minnesota running costs](/country-hiring-guides/united-states/minnesota/entity-running-costs-and-filings)sibling - [Minnesota tax presence](/country-hiring-guides/united-states/minnesota/permanent-establishment-risk)sibling - [Minnesota entity or eor](/country-hiring-guides/united-states/minnesota/eor-vs-entity)sibling - [Set up an entity, by country](/entity-setup-by-country)hub - [Entity Management (GEMO)](/entity-management)core - [Talk to an expert about Minnesota](https://www.teamed.global/contact?from=moving-from-eor-to-your-own-entity)CTA