How to Start an LLC in Ohio

How to Form an LLC in Ohio | Complete Guide
A Step-by-Step Guide

How to Form an LLC in Ohio

Creating an LLC in Ohio is a great means of safeguarding your personal assets while creating a legally established business entity. Establishing an LLC can be a confusing endeavor, but by completing a few straightforward steps, you can have your business up and running in no time. Following is a step-by-step guide to creating an LLC in Ohio, as well as a few more tips and FAQs.

What is an LLC?

An LLC (Limited Liability Company) is a business entity that isolates the owners from the business, i.e., they are not liable for the business debts and liabilities personally. LLCs also have pass-through taxation, where the income of the company flows through to the owners and gets taxed on their individual tax returns to sidestep double taxation.

1

Personal Asset Protection

An LLC provides a legal barrier between your personal assets and business liabilities, protecting your savings, home, and other personal property from business debts and lawsuits.

2

Tax Flexibility

LLCs offer pass-through taxation by default, meaning business income passes through to your personal tax return, avoiding double taxation while providing options for how you're taxed.

3

Management Freedom

Ohio LLCs provide flexibility in management structure, allowing you to choose between member-managed or manager-managed operations to suit your business needs.

Steps to Form an LLC in Ohio

Pick a Distinct Name for Your Ohio LLC

Your LLC name will be distinct from any other entity that has a registered business status in Ohio. You will also have to confirm that your intended name is clear using the business name search mechanism of the Ohio Secretary of State.

  • Required Words: Your name needs to incorporate words such as "Limited Liability Company" or short forms such as "LLC" or "L.L.C."
  • Prohibited Words: Avoid using words that are prohibited, such as "Agency," "Board," "Bureau," "Department," or any word that may suggest an association with a government agency, including "State," "Treasury," or "FBI."
  • Domain Name: Although not required, it is a good practice to inquire about the availability of a business name as a domain name. This can establish your online presence ahead of time.

After you ensure that your name is available, you can then go ahead with the registration process.

Choose Your Ohio LLC Statutory Agent

In Ohio, each LLC must have a Statutory Agent (also referred to as a Registered Agent in other states). This agent or agency receives official and legal documents for your LLC, including government notice, tax notice, and legal mail.

Statutory Agent Requirements

The Statutory Agent may be:
- You (if you are based in Ohio)
- An LLC member
- A professional Registered Agent service

Professional Service Benefits

Choosing a professional service can ensure your LLC is always compliant with state regulations. Professional services provide privacy, reliability, and ensure you never miss important legal documents.

Best Statutory Agent Services for Ohio

ZenBusiness

ZenBusiness offers LLC formation services, including their Statutory Agent service for $199 per year. With a user-friendly dashboard, you'll have 24/7 access to your LLC's documents and compliance alerts.

  • Quick, guaranteed LLC registration.
  • Convenient compliance services.
  • Simple online platform with document access.

Cons: No nonprofit formations.

Northwest Registered Agent

One of its strongest features is excellent customer service and security, and for $125 per year, Northwest offers Statutory Agent services. They offer a safe online portal and dedicated account manager for your LLC.

  • Strong data privacy policy.
  • A+ rating with the Better Business Bureau.
  • Supports corporation and LLC registration in all 50 states.

Cons: Higher upfront incorporation costs.

File Your LLC Formation Documents with the State

After you have a name and Statutory Agent, the next action is to officially file your Articles of Organization with the Ohio Secretary of State. This document formally forms your LLC.

Filing Fee

The cost to file the Articles of Organization in Ohio is $99.

Filing Options

You can submit the filing online or by mail.

By Mail:
Ohio Secretary of State
P.O. Box 670
Columbus, OH 43216

Expedited Filing:
Ohio Secretary of State
P.O. Box 1390
Columbus, OH 43216

Processing Time: Normal processing normally takes around 3 to 7 business days. Expedited choices are available:
- 2 business days for an extra $100 fee
- 1 business day for $200
- For those who are able to deliver in person, there's additionally a 4-hour expedited processing choice for $300.

What's Next After Your Ohio LLC Is Registered?

After your LLC is registered, there are a few crucial next steps to remember:

Split Up Personal and Business Finances

Establish a business bank account to maintain your business and personal finances separated. This is crucial for safeguarding personal assets.

Prepare an Operating Agreement

Even though Ohio is not required to have an Operating Agreement, it's strongly suggested. The document defines the regulation for the internal workings of your LLC, such as member duties, voting, and distribution of profits.

Get an EIN

If your LLC will have employees or want to open a business bank account, you'll require an Employer Identification Number (EIN) from the IRS.

Consider Business Insurance

Regardless of how small your LLC is, business insurance can provide security against possible risks, such as liability and damage to property. You should also think about workers' compensation insurance if your LLC is going to have employees.

Frequently Asked Questions (FAQs)

What is the cost to form an LLC in Ohio?

The filing fee for registering an LLC in Ohio is $99 for the Articles of Organization.

Is a Trade Name (DBA) required for my Ohio LLC?

In Ohio, you do not need to file a Doing Business As (DBA) name unless you wish to do business under a name other than your actual LLC name. If you do use a different name, you will have to file for a DBA.

How long does processing take for my Ohio LLC formation?

Standard processing is about 3-7 business days. Expedited processing is available:
- 2 business days for $100
- 1 business day for $200
- Expedited processing of 4 hours is done in person for $300.

Can I be my own Statutory Agent in Ohio?

Yes, you may be your own Statutory Agent, provided you have an Ohio street address and are available to accept legal documents during standard business hours.

Do I need an Operating Agreement for my Ohio LLC?

Ohio does not necessarily need an Operating Agreement, although it is very much suggested. This agreement establishes the internal mechanisms of your LLC, including structure of ownership and decision-making protocols.

Do I have to have an EIN for my LLC?

You will be required to have an Employer Identification Number (EIN) if your LLC is going to employ people or you want to obtain a business bank account. Obtaining an EIN is free from the IRS.

What are Ohio biennial report requirements?

Ohio LLCs must file a biennial report with the Secretary of State every two years. The reporting fee is $25, and it must be paid on the anniversary date of your LLC formation.

Can I modify my LLC name post-registration?

Yes, you can modify your LLC name by submitting an Amendment to Articles of Organization with the Secretary of State. This involves a filing fee and is an easy process.

Ready to Start Your Ohio LLC?

By following these steps and ensuring compliance with Ohio's regulations, you'll be well on your way to establishing a successful LLC in the state. Remember that while the process is straightforward, taking care of post-formation tasks like insurance, taxes, and business structure will help your LLC run smoothly and remain protected.

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