It is easy to form an LLC in Ohio in 5 easy steps.
Ohio is one of the best places to launch a business considering that it has very good access to SBA funding. When forming a business, there are different types of structures that one can choose from, including sole proprietorship, partnership, limited liability company (LLC), limited partnership (LP), limited liability partnership (LLP) and corporation. Of these, the LLC is the most popular form of business in Ohio because it offers a number of benefits including unlimited number of members, simplicity of structure and limited liability for its members. Also, it can be easily formed in as little as 5 steps.
What is the process of forming an LLC?
Anyone who plans to form an LLC in Ohio can follow the steps below.
1. Create a name for the LLC
Coming up with a name for the LLC is a very important step because this is how the business will be known to potential clients and suppliers. The name should be in line with the Ohio naming requirements. For example, it must include the phrase “limited liability company” or abbreviations such as LLC and L.L.C, and must never be confused with any government entity.
Another requirement is that the name should not be similar to another company in Ohio. For that reason, it is necessary to carry out a name search in the state database to make sure no other business is using the chosen name.
If a business owner intends to trademark the name, it is wise to search the U.S. Trademark website to make sure the name is not already trademarked in the country.
Naturally the business will need a website therefore, if the name is available for use, the next step is to purchase a domain to make sure that no one else will use that domain. This should be done even if there is no rush to create the website. If this step is neglected, someone else may get that domain and then the business owner will be required to pay a lot of money to purchase it from the owner.
2. Select a registered agent
Before filing for the LLC, it is necessary to appoint a statutory agent. A registered agent is an individual or a company that acts as a point of contact between the company and the state. The agent’s responsibility is to handle the LLC’s legal documents, lawsuit notices, and official government correspondence. The agent must be a resident of Ohio or be an organization authorized to conduct operations in the state. The owner of the business can choose to act as a registered agent. The risk is that the home address has to be publicized if the business is run from home and the member may be served with legal papers in front of family members.
3. File the articles of organization
Filing for an LLC in Ohio is done with the Secretary of State at a cost of $99. It can be done online, through the post or in-person. Members are required to provide the name of the LLC, names of members, name of the statutory agent, and the services/products that the LLC will offer.
4. Create an operating agreement
An operating agreement is not mandatory in Ohio, but it is advisable to have one in place. It’s a legal document that gives clear details of ownership and procedures of operations of the company. Members can consult it when there is conflict in future. TRUiC offers one of the best Ohio LLC operating agreement guides.
5. Get an EIN
The business needs to comply with tax laws therefore it should immediately get an Employer Identification Number (EIN) from the Internal Revenue Services (IRS). It’s a business’ identity number for tax purposes and is essential when opening a bank account, filing and managing taxes, and hiring employees.