If you’re looking for a reliable DIY guide for starting an LLC in Ohio, look no further. Below you’ll find all the information you need to launch your business and handle any associated costs. Follow each step carefully and your LLC will be established and ready to hit the ground running.
That said, the process can be complex, with various filings and costs, so if at any point you need help, you can hire an LLC formation service – they’ll take care of the paperwork so you can spend more time growing your business.
Recommended: Compare the Top LLC Services
If you’re new to the process of starting an LLC, you might also be unfamiliar with the LLC formation services that are reliable and offer great value – like ZenBusiness. As a reference point we compared them to the two most well known LLC formation services, IncFile and LegalZoom. See our comparison guides for more information:
Step 1: Name Your LLC
What’s in a name? Quite a bit, actually. Your business name is your Ohio LLC’s identity, its personality, its reputation. Find a name that sticks in customers’ minds – while conveying your brand qualities – and you’ve struck gold. A unique, memorable name can draw in new customers and keep existing ones coming back.
Your LLC name is going to appear everywhere: business cards, marketing collateral, websites, legal contracts, bank accounts, invoices, directories, and much more. So be sure that it conveys your product, service, brand, and values.
While you can (and should) be creative with your business name, there are certain state requirements that it must follow.
As you’re choosing your perfect LLC name, you’ll need to make sure that you’re staying within Ohio’s boundaries. This means that your name must include the words/abbreviations “Limited Liability Company,” “limited,” “LLC,” “L.L.C.,” “ltd.,” or “ltd.” And it shouldn’t imply affiliation with any government agencies, nor should it contain any profanity or slurs, so keep it family friendly!
You can follow all of these rules, but it won’t matter if your name is already taken. You’ll need to find a name that’s distinguishable from all others on file with the Secretary of State. If you need to distinguish a name, making the following changes will NOT cut it:
- Adding or deleting punctuation, contractions, or abbreviations
- Adding, deleting, or changing articles or conjunctions
- Changing verb tenses
- Using singular vs. plural versions of the same word
- Altering business type designators like LLC, Inc., LP, or Ltd.
If you need to distinguish your name, any of the following changes will do the job:
- Adding or deleting letters
- Changing how numbers are expressed (Arabic numerals vs. Roman numerals vs. spelled out)
- Rearranging words
- Using unique spellings or misspellings
- Using the same word in a different language
- Using the same base word(s) in a different form
- The use of a word(s) that implies affiliation to the government, a bank, trust, insurance agency, cooperative, or legal professional association
Consider this: your friend Fanny wants to open a flower shop in Cincinnati, Ohio. The name she is considering, Flowers by Fanny, LLC is already in use. So she comes up with a new one: Fanny’s Florals and Design, LLC. This name is similar to the original but includes new words, distinguishing it in the Secretary of State’s records.
Determine the Name is Available
Of course, you will only need to make distinguishable changes if your name is already taken. Don’t make the mistake of ordering business cards, creating advertisements, and using a name on documents like the Articles of Organization without first confirming it’s available. Use the Secretary of State’s Business Name Search to see if there’s an existing business using your desired name.
Maybe you pegged a distinguishable name right away, or maybe it took some modifications, but either way, once you have a unique name, you can lock it down by filing a name reservation.
Optional: Name Reservation
You may have fallen in love with a particular name, but still have some preparation and paperwork to sort out before starting your LLC, and you’re worried that someone will swipe it in the meantime. To calm your nerves, you can reserve that name in Ohio for a total of 180 days.
Think about Fanny. After making her name distinguishable, she’s ready to make it official, but if she’s waiting on some paperwork to start her LLC, she can place a hold by filing a Name Reservation/Transfer/Cancellation form online or by submitting a paper copy to:
Office of the Ohio Secretary of State
P.O. Box 13697
Austin, Ohio 78711-3697
Either option will cost you $39, payable by check or credit card. Standard processing time is 3-7 business days, but if that’s not fast enough for you, the state offers three expedited options: two-day for $100, one-day for $200, and four-hour for $300. For the one-day and four-hour options, you must deliver your form in person.
If you’re taking advantage of the two-day expedited processing, send your form instead to P.O. Box 1390, Columbus, OH 43216.
Hand-delivering your form? Take it to the Client Service Center, Suite 103 at 80 E. Broad St., Columbus, OH 43215.
Step 2: Choose a Statutory Agent
Fanny’s LLC is quickly taking shape, and if it’s going to operate in Ohio, she’ll need a go-between for state and legal communications. This is called the statutory agent.
A statutory agent is a key component of your budding LLC, handling all of its sensitive communication with the state so you don’t have to. But maintaining an agent isn’t just a convenience, it’s required. Take it from the Secretary of State website, which says: “All business entities are required to appoint and maintain a statutory agent. A statutory agent will be served all legal documents regarding your business entity and is responsible for sharing this information with you.”
Taxes, lawsuits, maintenance requirements, and more – the statutory agent takes care of it all. If you had to do this yourself, it would pile additional tasks onto your already-full plate. Plus, your agent makes your business available to receive documents even when you’re out of town or away from the office. This is especially important if your physical office is outside Ohio.
Now for the practical application, the “how-to.” Don’t worry, getting your statutory agent on file is easy. Just include their name and address on your Articles of Organization. The agent will also need to sign an Appointment of Agent form, consenting to the appointment. This will put their information on your public record.
You have two options for who can serve as a statutory agent: an individual or a company.
Individual as Statutory Agent
You may think that an individual statutory agent would need specialized training or experience, but this isn’t the case. Anyone can serve as your statutory agent, as long as they are an Ohio resident, have a physical address in the state, and are at least 18 years old. If you don’t mind the responsibilities, you can even appoint yourself.
Statutory Agent Service
It can be a lot easier, though, to use an LLC formation service like IncFile or Northwest Registered Agent, so we highly recommend it. Not only will they take care of business formation requirements, but they’ll also include a free statutory agent service. Or, if you’d rather start your Ohio LLC on your own, you can use a national statutory agent service to cover your agent duties.
During the life of your LLC you may, at some point, need to change your statutory agent. Perhaps you want to switch from an individual to a professional service, or maybe your existing statutory agent resigns. Either way, you’ll want to make the change as soon as possible because operating without an agent on file can lead to administrative dissolution.
Step 3: File the Formation Documents with the State
This is where the LLC formation process kicks into high gear. Let’s check back in with Fanny.
She’s reserved her unique business name, designated a statutory agent, and she’s ready to get her LLC off the ground. It’s time for Fanny to take on the most important LLC document: the Articles of Organization. This filing creates a record for Fanny’s Florals and Design, LLC with the Ohio Secretary of State, giving it the authorization to commence business in the state.
There are three different filing options: online, by mail, and in person. Each has its own benefits, but all three come with the same fee: $99. It’s more about which method works best for you.
Make sure that you submit all parts of the document, including the cover letter, Original Appointment of Statutory Agent form, and the Articles of Organization application. (All three documents are included in the pdf download and online filing process).
Standard processing time is 3-7 business days, but if time is short, you can choose one of three expedited options: two-day processing for $100, one-day processing for $200, and four-hour processing for $300. The one-day and four-hour options are only available if filing in person.
Head over to the Ohio Business Central portal. You’ll need to create an account if you haven’t done so already. Then, follow the instructions and you’ll be done in no time.
Download and complete a hard copy, then mail it, with your payment, to:
Office of the Ohio Secretary of State
P.O. Box 670
Columbus, OH 43216
Using the two-day expedited option? Send your documents here instead:
Office of the Ohio Secretary of State
P.O. Box 1390
Columbus, OH 43216
If you’re using one of the two other expedited options, you’ll need to hand-deliver your documents to:
Client Service Center, Suite 103
80 E. Broad St.C
Columbus, OH 43215
Step 4: Create an Operating Agreement
The operating agreement is the framework that holds up an LLC, the vital underpinning that establishes processes for its procedures, activities, and conduct. Essentially, it serves as your company’s bylaws.
Technically, you’re not required to adopt an operating agreement in Ohio, but this doesn’t mean it’s what’s best for your business. Drafting an agreement not only provides your LLC with procedures that are optimized for its needs, but it also offers legal protection and legitimacy in the eyes of banks, courts, government agencies and more. If you want to set your business up for success, you’ll need an operating agreement on file.
Let’s say our friend Fanny sells a percentage of her company to two other owners. Her operating agreement could stipulate how the LLC’s assets would be distributed among them in the case of dissolution. But if she decided to maintain sole ownership, the agreement could be used in court as evidence that the LLC’s assets are separate from her personal ones. These are just two examples, but the operating agreement governs everything from member duties to tax structure.
If you’ve decided to draft an agreement, there are two ways to go about it:
- Write it yourself. Don’t be intimidated by this option. There are plenty of free online templates that serve as helpful guides. You can create an effective document from most of the templates out there, but we recommend this one, courtesy of Northwest Registered Agent. It’s got everything you need to draft a solid agreement.
- Hire an attorney. If you want to be absolutely sure that you don’t miss any important details, an attorney can write or review the agreement for you, ensuring that it complies with state law, includes all necessary information, and avoids the state’s default laws.
What are default laws?
Each state has its own set of generic, baseline laws for how LLCs should operate. These laws, however, only govern matters not included in your operating agreement. Take dissolution, for example. If your LLC ever dissolves, your operating agreement would determine what happens to its remaining assets and debts. But if you fail to include it in the agreement, the state will make that decision for you.
Because default laws are broad and not tailored to your specific business, they often aren’t in your LLC’s best interest, so it’s best to avoid them by being as comprehensive as possible in your agreement.
Step 5: Get an EIN
There’s simply no way to avoid taxes. In fact, it’s illegal to try, so don’t do it.
Federally, LLCs are classified as “pass-through” entities, businesses that don’t file corporate tax returns, but whose owners include income and losses on their individual returns. Still, there are certain circumstances that require LLCs to pay federal taxes, like classifying as a corporation or partnership, hiring employees, or selling merchandise. So, in Fanny’s case, if she plans on hiring additional florists and selling bouquets, she will need to apply for an EIN.
The Employer Identification Number (EIN) is a nine-digit number that the IRS will use to identify your company’s tax accounts, so if you pay any business taxes, it’s extremely important to have one. Click the “Do I need an EIN?” link on this page to see if you fall into this category. If so, apply for an EIN one of three ways:
Need to get this done quick? File online – it’s by far the most efficient method. You can only complete the process between 7 a.m. and 10 p.m. EST, Monday through Friday, but you’ll receive your number immediately upon finishing the digital form. Keep in mind that you will need to provide a valid individual taxpayer number (like a Social Security Number) as part of the process.
You might prefer the feel and security of a paper form. In this case, download Form SS-4, complete it, and fax it to (855) 641-6935. You will receive your EIN within four business days.
Or, there’s always trusty postal mail. However, this is the slowest option, as processing typically takes around four weeks. If that doesn’t deter you, fill out Form SS-4 and send it to:
Internal Revenue Service Operation
Attn: EIN Operation
Cincinnati, OH 45999
Okay, so you’ve filed the Articles of Organization, designated a statutory agent, adopted an operating agreement, and filed for an EIN. Time to start doing business, right? Sorry, there are a couple of additional steps you may need to take first. But don’t worry, you’re almost there!
Step 6: Taxes, Licensing & Income Reporting
For all intents and purposes, most LLCs will be official after completing all the prior steps. Still, it’s important for business owners like Fanny to keep looking ahead, as there are certain maintenance requirements to keep an Ohio LLC running smoothly and in good standing with the state.
Before you start doing business, create a plan for the following potential LLC requirements:
As mentioned earlier, LLCs are almost always classified as “pass-through” entities, which means that they don’t pay income taxes directly to the federal government. That responsibility falls instead on the owners, who must include business income and losses on their personal 1040 tax returns and/or Schedule C. LLCs are flexible with tax structure, so you can choose to have yours taxed like a corporation instead. In this case, it would need to file a separate corporate tax return.
Like federal income taxes, Ohio’s state taxes are reported on the LLC owners’ personal returns rather than a separate corporate return. But this isn’t the only state income-related tax for Ohio LLCs. If your business has gross annual receipts of $150,000 or more, it will owe a Commercial Activity Tax. Register for this tax either through the Ohio Business Gateway, or by completing and mailing a paper form.
There are other conditional taxes that your LLC may owe depending on its circumstances. For example, if you sell merchandise, it will be subject to a Sales Tax and Use Tax via the Ohio Business Gateway or with hard copy applications.
Your LLC’s city, county, or municipality may have its own set of business taxes as well. Registration for some of these taxes is available through the Ohio Business Gateway, but you can also check your local government’s website.
For more information, and to find out which taxes you’ll need to pay, visit the Ohio Department of Taxation.
The Articles of Organization may have already made your business legitimate, but your LLC might still need to obtain a license before doing business. This all depends, however, on the type of business you run.
Take Fanny, for example. Before opening her flower shop for business, she may need to obtain a Nursery Dealers License from the Ohio Department of Agriculture. And if she wanted to sell her special home-baked sugar cookies in-store, she would need a Home Bakery Registration. Unsure which licenses your LLC might need? No worries. Check out the state’s comprehensive Licenses & Permits page.
Certain cities and counties require their own specific licenses on top of any state ones, so you should also check with your local government.
To ensure that they have the most current and accurate business information on file, many states require their LLCs to file some type of annual report, but Ohio is not one of them.
Because you’re not submitting yearly updates to the state, be sure that you’re making changes (like statutory agent changes, address changes, etc.) as they occur.
And we’ve come to the end. It’s a long process, and not always easy, but the reward is well worth it. If you’ve made it this far, congratulations! Your Ohio LLC is ready for takeoff. So go ahead and start with that big sale, promotional campaign, or business deal. Maybe you’ll see Fanny out there in the business world, selling her beautiful floral creations.
Need Help Creating Your LLC?
If you even skimmed this guide to look over the steps, you likely got a sense of how many moving parts there are when starting an LLC. Can you do it all yourself? Absolutely. We have complete confidence in you.
But if you’d rather hand it off to someone else and not have to worry about it again, we recommend using an LLC formation service. This way, you can go about your other business responsibilities with the confidence that everything will be submitted correctly and punctually.
Plus, an LLC formation service can handle maintenance items like Annual Reports, so you can take them off your to-do list. And on top of that, many services also provide a statutory agent.
Sound good? Whether you know that you’ll need an LLC service or you’re just exploring your options, take a look at IncFile and Northwest Registered Agent. These are two of the top services available. And you can take our word for it because we’ve done a whole lot of research on the topic.