How to Start an LLC in Ohio: Everything You Need to Know
An LLC is an affordable type of business entity in Ohio, with unique requirements for a Limited Liability Company, including providing Ohio’s Secretary of State with the business name. 5 min read
2. Choosing a Name for Your LLC
3. File Articles of Incorporation
4. Appoint a Registered Agent
5. Get an Employer Identification Number (EIN) from the IRS
6. Comply with Other Tax and Regulatory Requirements
7. Prepare an Operating Agreement
8. Foreign LLCs Doing Business in Ohio
How to Start an LLC in Ohio
Wondering how to start an LLC in Ohio? An LLC is an affordable type of business entity in Ohio, with unique requirements for a Limited Liability Company, including providing Ohio’s Secretary of State with the business name. The process is easier in Ohio than many other states as there are no compliance requirements and fees. Basic details, including a statement of purpose, must be given.
Choosing a Name for Your LLC
The initial step is also the most important one. You must craft a unique name for your Limited Liability Company. Ohio requires that:
- Your business name must include any of the following:
- Limited Liability Company
- If your name contains certain words, then there are extra papers to file and a licensed individual may be required within the organization
- These words include Attorney, University, and Bank
- For example, using the name Attorney may require a lawyer within the organization
- Specific words are prohibited in the name
- On the grounds that they would add confusion
- Examples are Secret Service, FBI, and Treasury
- Your name must be unique from other organizations based in Ohio State
- Check if it is taken easily using Ohio Secretary of State’s business name database.
To reserve the LLC name, for as long as 180 days, file Form 534-B, called the Statement of Reservation of Name with the Colorado Secretary of State online. File this Statement by postal mail with the applicable fee. Ensure you look to see if the name is taken already so that you can reserve its domain name. Even if you don’t see yourself creating a website name now, you may want to in the future.
Also, check if a business email address is available for this name as part of your decision-making process. Use Google apps to find a professional email address with the format @yourcompany.com.
File Articles of Incorporation
In all three cases, you must submit the filing fee with the documents. The Articles of Incorporation have to include the LLC name, identify a Registered Agent, and say when it will dissolve (if applicable).
An expediting fee exists for an extra $100 fee; the Articles will be processed within two business days. For $200, you will get the submission completed in one business day, while $300 gets you processing within 4 hours, provided you deliver the documents in person before 1 pm. As fees can change, please check with the Secretary of State for current charges.
Appoint a Registered Agent
When you apply for an Ohio-based LLC, you must elect a Registered Agent, which can be an individual or business. This agent volunteers to accept legal paperwork on behalf of your LLC, including state filings and documents of legal action. A Registered Agent ought to agree to this activity before ever being in a situation where the agent is needed.
The Registered Agent must have an Ohio physical street address and agree to share legal information obtained with the LLC.
Get an Employer Identification Number (EIN) from the IRS
An EIN is:
- Short for Employer Identification Number
- The Federal Tax Identification Number identifying a business entity
- Think of it as a social security number for your business
- Necessary when filing federal and state taxes
- Required when you have 2 or more LLC members
- Obtained from the IRS for tax reasons after the business is created
- Get it at the IRS website and then submit the form online or print and mail it
Comply with Other Tax and Regulatory Requirements
There are more tax and governing necessities that your LLC may have to abide by, depending on its specific structure. If you have only one owner, you must get an EIN if you plan to add employees or if you choose taxation as a corporation rather than a sole proprietorship, called a disregarded entity. Ohio has a Commercial Activity Tax that many business entities must also abide by, including single-member LLCs.
There may also be extra business licenses (state and local) required, dependent on where your company operates. Also, if there or LLC employees or plan to sell products and collect sales tax on them, you must register with Ohio’s Department of Taxation. In most cases, you can complete the registration through the Ohio Business Gateway (OBG) via the Internet or mail the proper form. The OBG website provides current details.
Prepare an Operating Agreement
An Operating Agreement need not be submitted to the Secretary of State with the Articles of Organization. Although an Operating Agreement is not a requirement in Ohio for an LLC, it is strongly recommended, particularly if the LLC has two or more members. This agreement is a legal document that lays out the details of ownership and operation to guide LLC activities, including how owners will distribute income and liabilities. For a single-member LLC, it can protect from personal liability.
If you decide to create an Operating Agreement, it doesn’t need to be filed with the Articles of Organization. Keep it on file though; this is done by the Registered Agent. In Ohio, Operating Agreements for Limited Liability Companies are viewed as governing documents.
Foreign LLCs Doing Business in Ohio
Every LLC created outside Ohio State’s physical boundaries has to register with the Ohio Secretary of State when it plans expansion into Ohio. A Registered Agent must be appointed by the LLC. This agent is in place for service of process purposes and must be one of the following:
- A resident of Ohio
- Application involves providing an Ohio address
- This can be a PO Box
- Must check box on form saying you have an Ohio residence
- One of Ohio’s corporations
- A foreign corporation that
- Has a business location in Ohio, or
- Is licensed to conduct business in Ohio
For registration, file Form 533 B, titled Registration of a Foreign Limited Liability Company, and file it by mail. Include the fee with the application, as well as a certificate of legal existence or good standing in the business’ home state; dating on the document must be within 60 days before the certificate is filed.
Ensure the LLC name is not already taken in Ohio before you start the filing process. This is easily done using the Ohio business name database. Should you find the name to be already taken, your foreign LLC must then use a trade name in Ohio. Obtain one using Form 534 A and either mail it or submit it online, along with the respective fee.
If you are considering whether or not to start an LLC in Ohio, it is advisable to get quality legal counsel. On our UpCounsel marketplace, you will find several experienced lawyers who are happy to help answer your questions and guide you through the process of creating a Limited Liability Company, if you decide it’s right for your business. To connect with these legal professionals, simply post your legal need in our UpCounsel marketplace. The lawyers in the marketplace are graduates of recognized legal institutions, such as Harvard Law, and have an average of 14 years’ experience.