Step 1) Verify & Secure Your LLC Name
To secure and register your brand name it must be unique (i.e. not too similar to another business name registered in Ohio), and shouldn’t contain any restricted wording. Your LLC name must also contain the words “Limited Liability Company” or “Limited”, or the abbreviation “LLC” or “Ltd”.
To check if your name is available, conduct a business name search through the Ohio Secretary of State. If your desired name is already taken, you’ll either have to modify it to make it distinguishable, or rethink your name altogether.
If needed, you can reserve your business name for up to 180 days before you file for $39.00.
Quick Note: Before you commit 100% to a name, you may also want to check that there’s a decent URL available for your business. Use Weebly to search your options. If there’s a quality domain name for purchase, we advise buying it right away. Even if launching a business website isn’t on your radar right now, it’s going to be soon, and you might as well nail down a domain name that’ll make it easy for customers to find you!
Step 2) Appoint A Statutory Agent
A statutory agent, or registered agent, is an intermediary who is responsible for officially receiving and helping process important paperwork like state filings, tax forms, legal notices, and so forth.
They may be either an individual who’s a resident of Ohio, or a business entity that’s legally registered with the Secretary of State. Either way, they’ll be required to provide an Ohio address.
Ohio doesn’t forbid business owners from acting as their own statutory agents, but it’s a lot to take on while running a business (read our guide to learn more). We highly recommend delegating this task to a professional.
We think the best way to get professional statutory agent services is through an online filing provider like IncFile. They include a full year free when you form your Ohio LLC with them, and after the first year’s up it’s only $99 to renew.
Step 3) File Articles Of Organization
To legally form an LLC in Ohio, you’ll have to file the Articles of Organization with the Secretary of State. You can either file online or on paper through postal mail. The document is a declaration of the basics of your brand for the public record, including:
- The name and purpose of your LLC
- The LLC’s period of existence (if limited)
- The name, address and signature of your statutory agent
- The signature(s) of one or more members, managers or other representatives executing the document
Filing Fee: $99.00 (several expedited options available)
Step 4) Get An EIN
An EIN, or Employer Identification Number, is a nine-digit number that’s used to track business activity and makes it possible to open a business bank account, hire employees, and so on. It’s required by both state and federal governments for essentially the same reasons that individuals are required to have Social Security Numbers.
That said, some single-member LLCs are not actually required to have EINs. If you’re working without any partners, you may be able to get away without one. Refer to this IRS page to learn more.
Obtaining an EIN is fairly painless. The most efficient way to get one is by using the IRS free online application, but there are several other ways to go about it too. We outline all of them in our EIN guide.
Step 5) Open A Business Bank Account
It’s absolutely essential that you completely separate your business expenses from your personal bank account. To avoid muddying the financial waters, you’ll need to open up a separate bank account designated for your business finances.
Where your company chooses to bank is an important decision that shouldn’t be taken lightly. Between local, state and national banks and credit unions, you have an abundance of options at your disposal.
Different types of banks have different strengths, from customer service to ATM accessibility to online banking features. Figure out what your priorities are, then take the time to familiarize yourself with what local and national options have to offer. Take a look at our top 5 business bank accounts to get started on your research.
Step 6) Draft An Operating Agreement
While you won’t file the operating agreement with the state, it’s foolish to be in business without it. Your operating agreement will serve as the governing document for your LLC, defining exactly how the company will run. This will include information such as:
- Each member’s title and responsibilities
- The company’s profit and loss distribution
- The overall ownership/management structure
- What will happen if a member leaves
Having an operating agreement adds a layer of protection for everyone involved and allows members to easily prevent or resolve disputes. Even solopreneurs should have one.
To get started, check out our favorite templates, or consider adding a custom operating agreement to an online incorporation package.
Step 7) Tackle Ohio Business Taxes & Licensing
The final step is to make sure your LLC is operating in total compliance with the federal, state and local government by taking care of any business taxes, licenses and permits. Here are some of the best resources for each:
- Federal: Head over to the federal licenses and permits page on the Small Business Association website to find all the business activities that require special licensing, as well as the corresponding government agencies. Then, to learn about federal LLC taxes, pop over to the IRS business taxes page.
- State: The Ohio Business Gateway has some essential information on state-specific permits and licenses, while the Department of Taxation website is the best resource for Ohio business taxes.
- Local: To make sure you don’t overlook any city or county-specific requirements, give your local Chamber of Commerce a call or visit.
If you don’t have a legal team to help you sort out licensing requirements, you might consider getting professional help from a business license service. They’ll do all the research on your behalf and send the necessary paperwork to your door (or inbox)!
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