A 16-Step Checklist for Starting a Business in Ohio

1) Write a Business Plan

Jumping into this endeavor without goals, directives, or a sense of direction can lead to a scattered, unproductive business.

A business plan lays the groundwork for your future success. It helps you analyze key elements of your business and forge pathways to achieve your goals. Here are a few things you should consider including in your business plan:

• Executive Summary (a separate document that gives a complete overview of your business’ purpose, plans, goals, competition, opportunities, etc.)
• Company description
• Market Analysis (opportunities, competition, etc.)
• Managerial or organizational structure
• Products and/or services
• Marketing strategies
• Funding goals
• Financial projections

Business plans aren’t just great for internal operations, but they give your business legitimacy in front of potential investors, customers, partners, and more. Need help? Check out this guide from the U.S. Small Business Administration.

2) Decide on a Business Name

You might’ve come up with the perfect name right away. If so, consider yourself lucky.

Sometimes, deciding on a business can be difficult, requiring brainstorming meetings and late-night rap sessions. That’s because your name is your business’ identity and reputation. It should be something that’s unique and memorable but also defines your business purpose.

Every business structure (see step 3) has its own naming restrictions. Among other things, Ohio LLC names must include “limited liability company” or an abbreviation thereof. And corporation names should use “corporation,” “incorporated,” “company,” “limited,” or an appropriate abbreviation.

Even if you follow all the necessary requirements, it won’t matter if your desired name is unavailable. Check to see if your name is taken by searching for it on the Secretary of State website. If it’s free, you can claim it by filing a name reservation or listing it on your formation documents.

3) Decide on a Legal Structure

There are only a few types of business structures, but each one dictates some important parts of how your business will run.

The most popular types are the sole proprietorship, general partnership, limited liability company (LLC), S corporation, and C corporation. Most small businesses go with the LLC because of its unique blend of flexibility and personal asset protection.

However, you shouldn’t make this decision without reading up on all of your options. We’ve done plenty of research on each business type and developed side-by-side comparisons. Check out our LLC vs. Corporation and LLC vs. Sole Proprietorship comparison guides for a closer look.

4) Choose a Statutory Agent

The Secretary of State needs a point of contact for your business, someone who will be available at your registered office address during typical business hours – 9am to 5pm.

This person is called a statutory agent, and they serve as an intermediary with the state, receiving all of your company’s important legal communications and relaying them on to you. The Ohio statutory agent ensures that no important state documents, deadlines, or payments fall through the cracks, so you’ll want to choose a person or company you trust.

You can choose either an individual or a business entity as your statutory agent in Ohio, but they must:

• Be an individual Ohio resident or a corporation authorized to do business in the state.
• Have a physical address in Ohio.
• Have a mailing address in Ohio (no P.O. boxes allowed).

This is the individual that will be responsible for keeping your business in good standing with the state, so you’ll likely want someone who understands the particulars of running a business, like an attorney or manager. But because the requirements are fairly broad, you can also appoint friends, family members, etc.

Or, you can choose a statutory agent service instead. These companies take care of all your statutory agent responsibilities, and some will even handle your business formation and business maintenance requirements as well.

Important: You must continuously maintain a statutory agent on file with the Secretary of State. If your agent resigns or you appoint a new one, you’ll need to notify them by filing the appropriate documents.

5) Register Your Business

This is the big one, the step that officially creates your business. No matter which business type you choose, you’ll need to register it with the Secretary of State.

LLCs: Forming a limited liability company in Ohio means filing an Articles of Organization either online or by mailing in a paper form. Either method comes with a $99 fee, but it’s well worth the cost because this is your ticket to officially starting your LLC in Ohio.

Corporations: Rather than submitting the Articles of Organization, starting a corporation requires an Articles of Incorporation, although your filing options and fees are the same.

Sole Proprietorship/General Partnership: There are no official forms or fees to register as a sole proprietor or general partnership. Simply start doing business and that’s it! While this is obviously faster and easier, we recommend incorporating your business because of the personal asset protection LLCs and corporations provide.

Foreign Entities: If you’ve already started your business in another state and now you’re expanding to Ohio, you will need to foreign qualify it by filing either a Registration of a Foreign LLC or a Foreign Corporation Application for License (or the appropriate form for a nonprofit, LLP, etc.). Foreign qualification takes the place of other formation documents, so you won’t need to file an Articles of Organization or Incorporation, but it costs the same amount ($99).

6) Get an EIN

The Employer Identification Number (EIN) is your ticket to doing state and federal taxes. It’s a nine-digit number, much like a Social Security Number, that identifies your business on tax documents.

If you’re forming an LLC, it will be considered a “pass-through” entity, so the business itself won’t pay federal income taxes. Instead, you and the other members will report income and losses on your personal tax returns.

But this doesn’t mean you can go without an EIN. If your LLC pays any type of business taxes – like Sales, Use, or Unemployment Taxes – or hires employees, you’ll need to get one.

Unsure if you need one? The IRS provides a useful “Do I need an EIN?” link on this page, where you can also apply for an EIN. If you go through the online application process, you’ll receive your number immediately.

Otherwise, you can submit a Form SS-4 by fax to (855) 641-6935 or by mail to :

Internal Revenue Service Operation

Attn: EIN Operation

Cincinnati, OH 45999

7) Open a Business Bank Account

LLC and corporation owners are required to keep their personal and business finances completely separate, or they risk losing their personal asset protection. To do so, you’ll need a business bank account.

The good news is that opening a business bank account is pretty simple. Just pay a visit to your bank’s local branch and sit down with one of the bankers there. You will need to present your formation documents, an EIN number, and some personal information. Then, you can direct all of your business income and expenses to that account instead of a personal one.

It doesn’t really matter which bank you choose, whether it’s a national giant like Chase or Bank of America or a small, local bank. However, it’s usually easiest to go with the one where you have existing accounts.

8) Handle Any Tax Obligations

Ah, taxes. They’re always part of the picture, especially when you run a business.

Familiarizing yourself with your business’ tax requirements will help you establish a solid financial plan going forward. LLCs don’t need to file a corporate tax return and pay federal income taxes, so you’ll handle these taxes as part of your personal return.

Corporations, on the other hand, will need to file a Corporate Income Tax Return, while sole proprietorships/general partnerships will need to pay self-employment taxes.

There are a few other taxes your business may owe, depending on its activities:

Commercial Activity Tax: This is similar to a privilege tax, but it only applies if your business has gross receipts in Ohio of over $150,000 in a particular calendar year.

Sales and Use Taxes: Every business that sells goods in Ohio is subject to a 5.75% Sales and Use Tax on those items. Certain counties may have their own additional sales taxes, so you’ll need to check with your local government as well.

Withholding and Unemployment Taxes: If your business is an employer, it will be responsible for withholding employee income taxes through the Department of Taxation and paying Unemployment Taxes through the Department of Job and Family Services.

Visit the Ohio Department of Taxation website for additional information.

9) Find an Accountant

Sometimes it’s easier to hand off your financial responsibilities to a professional. Not only will an accountant ensures that your taxes are filed and paid correctly, but they might also find a few ways to save your business money.

Bookkeeping and tax procedures are time-consuming and require some specialized knowledge. Balance sheets, financial reports, cash flow, audits, and much more – an accountant can ensure that your company operates smoothly and streamlines its expenses.

This can be expensive depending on the complexity of your finances, but the benefits an accountant offers can be well worth it.

10) Create an Operating Agreement

An operating agreement constructs a framework of procedures and standards for your business. This is where you can lay out processes for member conduct, asset allocation, compensation policies, voting procedures, dissolution, and much more.

While operating agreements aren’t technically required in Ohio, they are essential to your business’ stability and success. They provide a safety net in legal disputes and legitimacy in front of banks, courts, government agencies, and other businesses.

You can either draft one yourself using an online template, or you can hire an attorney or an incorporation service to take care of it for you.

Once you’ve drafted your agreement, it must be approved by each of your LLC’s members, then filed with the rest of your business documents. You do not need to submit it to the Secretary of State.

11) Acquire the Necessary Licenses

After filing your formation documents, your business is legitimate, but it might still need specific licenses before opening its doors in Ohio. It may require several, or it might not need any – it all depends on your business activities, purpose, and location. Here are a few of the most common types of licenses and permits:

Professional Licenses: Your specific occupation might have its own licensure requirements through particular state boards. For example, accounting firms must acquire a license from the Ohio Accountancy Board.

Health Licenses/Permits: Businesses engaged in foodservice, healthcare, etc. often need licenses from their county health department.

Environmental Licenses/Permits: Any business whose activities affect Ohio’s land, air, or water – especially those that create emissions or hazardous waste – may need licenses or permits from the Department of Natural Resources, Environmental Protection Agency, or Department of Agriculture.

Commerce Licenses: Licenses through the Department of Commerce primarily apply to contractors like electricians or plumbers.

Local Licenses: Your specific city, county, or municipality might have its own licensure requirements. Take a look at your local government’s website to find out.

The state makes it easy to find any and all licenses your business may need by compiling them all on this Licenses & Permits page.

12) Consider Business Insurance

Even though it’s not pleasant to consider, there’s always a chance that unforeseen events might take a toll on your assets.

While forming an LLC or corporation offers some personal asset protection, additional business insurance can also protect your business assets in cases of lawsuits, damages, etc. You can acquire insurance for your business products, vehicles, specific occupations and much more.

If you hire employees, you’ll also need to get workers’ compensation insurance. SBA.gov has a useful guide for determining which forms of insurance your new business might need.

13) Build a Website

Your company’s digital presence is just as important as its physical one. Like it or not, most potential customers will find your business online, and if you don’t exist online, you’re missing out.

But don’t worry, you don’t need to be an HTML or web design expert to build a website. Sites like WordPress and Squarespace make it easy to construct an elegant and responsive website, no coding necessary. But if you’re not comfortable or confident doing it on your own, you can always hire a professional web designer to take care of it for you.

14) Launch Social Media Accounts

Making your mark on the digital landscape doesn’t start and end with your website. Most successful businesses also have a robust social media presence on multiple platforms. Facebook, Twitter, and Instagram are all great ways to connect organically with potential customers and develop your brand voice.

Just don’t forget to publish consistent social media content, or you’ll have trouble building a base of followers.

15) Understand Ongoing Ohio Requirements

After you’ve launched your business, things will likely be moving at 100 miles per hour as you evolve and grow. But in all of the excitement, you can’t forget your state’s ongoing compliance requirements. Every state has its own annual or biennial business requirements.

Ohio is one of the few states that does not require annual or biennial reports for its LLCs and corporations. However, Ohio LLPs, professional corporations, professional associations, and nonprofits need to file a Biennial Report to maintain their compliance. The fees and due dates for these reports vary depending on the business type.

16) Check Out Ohio Small Business Resources

You’re not on this journey alone. There are plenty of free resources available to make starting and growing your business a smoother, easier process.

Tax assistance, networking events, loan opportunities, small business development centers – all of these can help your business take off, and you can find them all on SBA.gov. For Ohio-specific information, take a look at the district office webpages for Cleveland or Columbus, which contain a publication packed full of valuable business resources. Find Cleveland’s here and the one for Columbus here. With this support and your pioneering attitude, you’ll be on the path to business success in no time.