Starting an LLC can be an exciting and overwhelming process — leading you to wonder where to begin. In this guide, we’ll take you through all the steps of forming an LLC in Ohio.
The good news is that once you know the steps and resources that you can utilize, forming an LLC in Ohio won’t be as daunting. In fact, much of the process can be done online and streamlined with the help of a professional LLC partner like ZenBusiness.
We’ve compiled this guide to walk you through each of the five steps to forming an LLC, providing insights, helpful tips, and important links along the way. Let us help you better understand the LLC creation process, so you can focus on what matters most — launching and growing your new company.
The 5 steps to form an LLC in Ohio:
To form an LLC in Ohio, you’ll need to register your business with the Secretary of State. This step is crucial since it allows the state to recognize your new company and stay in contact with you on any new laws or important business communications.
However, before you can do this, you’ll need to come up with an official name for your LLC and appoint a statutory agent. Next, you’ll want to craft an Operating Agreement to protect your company, even though it’s not a requirement of the state of Ohio. After that, you’ll register your business with the IRS to set yourself up to pay taxes and create business financial accounts.
While some steps are more complex and costlier than others, following this step-by-step guide will simplify the process of forming an LLC in Ohio. As you complete each of the five steps below, your LLC will be closer to running.
Step 1: Name Your Ohio LLC
While brainstorming your business, you’ve likely thought of a company name. But an LLC name is more than just a creative way to market your services; it also has to comply with state regulations. In this case, you’ll need to register your business name with the state of Ohio. Start by creating a list of possible names, and then run each through the Ohio Secretary of State business name search page to find one that is not in use. It might be helpful to check a more detailed explanation of the requirements for naming your business in Ohio so that you don’t run into any trouble while applying. These requirements include any words you cannot contain in your business name. Keep in mind that slight changes in spelling, punctuation, and choice of suffix will not be enough to distinguish your business, which is why a thorough name search is crucial. Once you’ve decided on your name, you can move on to the next step: choosing an LLC designator. To be in good standing with Ohio’s state law, your company’s name must end with the proper suffix. You can choose your specific LLC designator from the below list:
- Limited Liability
Once you’ve found a name that satisfies your business goals and Ohio’s requirements, you have the option to lock it in. If you don’t plan on filing your Articles of Organization immediately, it’s a smart move to reserve your business name. To reserve your business name before someone else gets it, you’ll need to submit a Name Reservation form and a $39 filing fee to the Ohio Secretary of State. You can do so through the Secretary of State’s online portal or use the printable PDF to mail it in. If you’d prefer to mail your form, you can send it to Regular Filing P.O. Box 670 Columbus, OH 43216 For expedited filing, send your reservation to P.O. Box 1390 Columbus, OH 43216 You also have three options for expedited service:
- For an additional $100, your name reservation application will be processed in two days.
- For an additional $200, your name reservation application will be processed in one day.
- For an additional $300, your name reservation application will be processed in four hours (however, the one-day and four-hour services are only available to walk-in customers who hand-deliver the document).
You can expect your name reservation application to be processed within three to seven business days if you choose regular service. If the name you’ve chosen is approved, it will be put on hold for 180 days. This will allow plenty of time for you to finish establishing your LLC. Before reserving your business name, though, you may want to confirm that you can secure a similar domain name. A website is a must for many businesses today, and you don’t want to reserve or register a business name only to discover that you can’t find a related domain name. You’ll want to perform a quick domain search until you find an available name that you like. From there, a partner like ZenBusiness can register this domain for you. It might also be a wise decision to protect unique aspects of your company by trademarking them at the state and federal levels. It’s often easier and quicker to secure a trademark at the state level, but federal registration can offer broader protection, especially if you want to do business outside of Ohio. To register a trademark with the Ohio Secretary of State, you’ll need to submit a Trademark and Service Mark Application, which can be done online or by mail. There is a $125 filing fee, but you can pay more for expedited service. To secure federal registration of a trademark or search to see if your desired name is federally trademarked, please consult the United States Patent and Trademark Office website. Finally, you can register a DBA (“doing business as” name) if you plan to market your LLC with a name other than your registered name. In Ohio, there are two classifications of this: a “trade name” and a “fictitious name,” though both use the same form. Trade names are required to be distinguishable from other Ohio business names (meaning you’ll need to use the business name search engine again), while fictitious names don’t. Thus, trade names provide greater protection. You can file for a DBA (either a trading name or fictitious name) online or via mail using the Name Registration form. The fee for filing is also $39.
Step 2: Appoint a Statutory Agent in Ohio
To continue with the registration process, Ohio requires that every LLC appoint a statutory agent, known in most states as a registered agent (we will use the two terms interchangeably, but they mean the same thing). Your statutory agent will act on your behalf, working as a third party between your LLC and the Ohio Secretary of State. The person or entity appointed will be the point of contact for legal matters — if your company is subpoenaed or sued, papers will be delivered to your statutory agent.
The company owner can be the statutory agent, but this is not always the best option. After all, being served in front of customers is a sure way to deter business, and with so many alternatives, it could be in your best interest to hire an outside registered agent service.
As long as your outside registered agent is a resident of Ohio or a business entity authorized to do business in Ohio, and has a physical street address in the state, hiring an outside registered agent service is an affordable way to save you possible troubles later on.
Here are a few more reasons why you might want to partner with an outside registered agent service like ZenBusiness:
- There’s no need to pay to refile forms if your business address moves. If you act as your own registered agent, you’ll need to update your registered agent’s address (your address) every time your primary office location changes.
- There’s no need to be tied to your desk during “normal” working hours. With an outside registered agent service, you’re free to work your own hours, from wherever you choose. You’ll know your paperwork is safely delivered to your registered agent’s address, as needed.
Step 3: File Ohio Articles of Organization
Once you’ve settled on a company name, you’re ready to register your LLC with the state of Ohio officially. To do this, you’ll file a form called the Articles of Organization. You can submit the Articles of Organization online using the Secretary of State’s website. Select “Submit a Business Filing” to begin. If you are mailing your Articles of Organization, send it to Ohio Secretary of State PO Box 670 Columbus, OH 43216 Here’s a quick rundown of what you’ll need to fill out during this process:
- Your LLC name: To register your company, you’ll need to register the LLC name you selected in step one.
- Office mailing address: You’ll need an office address on hand. This can be your company’s office location or your home address if you work remotely.
- Registered agent name and address: Your registered agent handles all of the communications between your company and the Secretary of State. They’ll receive legal paperwork on your behalf and will need to be available during normal business hours.
- Name and address of the submitter: Here, you’ll fill out your name and personal address. If you have partners in your LLC, they’ll need to provide their full names and addresses, as well.
- Effective date: Your effective date is the day your company will begin operating. If you want your LLC to be effective immediately, put the date of your filing here.
- Signatures: Your Articles of Organization must be signed by a member, manager, another representative of your company.
After all of the relevant information is filled in, you’ll want to review your form for any errors before submitting it. You’ll also need to pay a $99 filing fee to finalize your registration. You can pay online or send in a check if applying via mail. You can also rush your registration by paying an additional $100 to $300. Once you’ve paid, this process is complete. Your Articles of Organization will be processed within three to seven business days if you choose regular service. However, processing can vary depending on the number of filings that the office receives.
Step 4: Create an Operating Agreement
Once your LLC is registered, it’s time to decide whether you want to create an Operating Agreement for your new company. While Ohio state law does not require LLCs to have an Operating Agreement, it can be very beneficial for your company.
Your LLC Operating Agreement will detail how your company is to be managed, how voting structures work (specifically for partners), how finances are handled, and much more. This agreement can offer clarity for partners, managers, and employees and be used to help resolve conflicts if they arise. It can even cover HR-related topics.
Your Operating Agreement can be as expansive and detailed as you like, depending on the structure of your company. Since this agreement is not required by Ohio law, you can really make this document unique to your LLC. If your LLC has employees or partners, an Operating Agreement makes good administrative sense.
If you’re the sole owner and member of your company, you may think there’s no need to create an Operating Agreement for one person. However, you might want to reconsider. Your Operating Agreement can be used to outline what to do with your business if you become incapacitated or pass away.
Make sure all owners and managers in your LLC understand, review, agree to, and sign your Operating Agreement. It’s a good idea to have this document notarized, as well. Once signed, this document is legally binding in the eyes of Ohio.
You don’t have to submit this agreement to the Ohio Secretary of State, but you should keep it with your other business filings, so you can reference it easily.
Step 5: Apply for an EIN
The last step you’ll take to launch your LLC officially is registering your business with the Internal Revenue Service (IRS). You’ll do this by applying for an Employer Identification Number (EIN) to register your company with the IRS. Your EIN is essentially a Social Security number for your business — you’ll use this to file tax returns and hire new employees.
You can register for an EIN even if you’re the only member of your LLC. Having an EIN can make it simpler to separate your business and personal finances and can make handling your taxes much easier at the end of the year. It also helps protect your privacy, as you won’t have to use your Social Security number on important documents.
You can apply for an EIN by visiting the IRS EIN application page online. Once you submit the short application, you’ll immediately receive your EIN — this process is quick and free, and you’ll have your EIN ready to use within minutes.
Once you receive your EIN, you can begin hiring employees, setting up bank accounts for your business, and applying for any small business grants or loans your LLC is eligible for.
How much does it cost to start an LLC in Ohio?
Starting an LLC in Ohio is relatively affordable, but it always comes with upfront costs. The administrative costs of starting an LLC in Ohio can be found below. A breakdown of formation expenses include:
- Reserving your business name: $39
- Filing your Articles of Organization: $99
- Register a trademark with Ohio: $125
- DBA name registration: $39
If you get all the services above, it will cost at least $302 to get your company officially registered in Ohio (excluding expedited fees, special licenses or permits, and other filing expenses). If you decide to bring in a consultant to help, you’ll need to pay additional expenses. Thankfully, Ohio does not require business entities to file an annual report, so that’s one less expense to worry about!
Luckily, that’s where ZenBusiness can help. Starting at just $49 per year plus state fees, ZenBusiness can help you form your Ohio LLC by completing and submitting all of the necessary paperwork, providing registered agent services, and supplying a template for an Operating Agreement.
Do you think you’ll need additional help? No problem! For a bit more per year, you can also get more comprehensive benefits, including expedited services, obtaining your EIN, and a business webpage. Whichever plan you choose, partnering with ZenBusiness means peace of mind for you at every step of your LLC’s formation.
What are the benefits of an LLC in Ohio?
When starting a business, there are various forms it can take. Despite the options, 90% of ZenBusiness customers choose to form an LLC. Compared to corporations, limited partnerships, and other forms of entities, LLCs come with enticing benefits. Forming an Ohio LLC means you’ll reap the following benefits:
- Separation between personal and business liabilities: LLCs offer protection between business and personal liabilities, as well as division between financial debts and expenses.
- Safety from double taxation: LLCs offer safety from being taxed twice — once on your personal profits and once on your business profits. You’ll only pay taxes on your individual earnings on your personal tax returns.
- Adjustable management structure: LLCs allow you to run your company the way you want, with few regulations on how to structure your company. You’ll also have fewer reporting requirements than corporations.
In addition, by forming an LLC, you might be eligible for a certain startup or additional small business loans. For a more in-depth look at why an LLC might be a better option for you, see our breakdown of what an LLC is and how it compares to a corporation.
How is an Ohio LLC taxed?
Understanding how your taxes work when forming an LLC is important. While it’s completely possible to learn LLC tax laws and handle your own taxes, you may feel more comfortable partnering with a professional LLC partner like ZenBusiness or receiving in-depth advice from a qualified accountant or tax specialist. We’ll help you get started by walking you through all of the basic tax details you’ll need to know for your Ohio LLC. LLCs are typically considered “pass-through entities,” meaning they are not subject to corporate taxes. Instead, the profits and losses are passed through to the owner’s personal income, and the responsibility to pay LLC taxes falls on the individual. However, Ohio has a commercial activity tax that applies to LLCs. If your LLC has gross receipts of $150,000 or more, you will be responsible for the tax, which costs a minimum of $150. If you are liable for this tax, you will need to register with the Ohio Department of Taxation (DOT). You can do so by filing form CAT 1 or registering through the Ohio Business Gateway. Here are some additional tax scenarios you should be aware of:
- Self-employment taxes: As the owner of an LLC, you’re responsible for paying the taxes that would ordinarily be deducted from your paycheck if you were working a regular job, such as Social Security and Medicare. These are called self-employment taxes.
- Different tax structures: Most LLCs choose to be taxed as pass-through entities, but if your company decides to be taxed as a C corporation, you’ll first need to fill out an 8832 tax form each year. From there, you’ll file separate business and personal taxes, including your specific profits on your personal taxes. Your company will also file both state and federal returns.
- To stay compliant: LLC owners are required to pay taxes on the income they earn each year. If you want to avoid paying penalties during tax season, you should make estimated quarterly tax payments for both federal and state taxes. To stay compliant, you’ll also need to withhold money for federal, state, Social Security, and Medicare taxes from your employees’ paychecks each pay period and submit these withholdings to the IRS and state.
- To protect employees: Your LLC will likely need to pay unemployment taxes, which help employees if they lose their job or are laid off. You can set up your LLC to pay this tax online on the Ohio state website.
- For LLCs collecting sales and use tax: If your LLC sells items that collect sales and use tax, you’ll also need to apply for a sales tax license online via the Ohio Department of Taxation.
Opening Business Financial Accounts for Your Ohio LLC
Now that your LLC is registered and you have an EIN, you can start setting up financial accounts so that your Ohio company can begin moving money around, hiring employees, and making business purchases. You should start by setting up a primary checking account for your LLC that will be used for normal business expenses and managing payroll. If you don’t already have a bank in mind, it may help to do a quick search to determine if there are any local banks or credit unions near your office. Look for banks offering business accounts or incentives with in-branch services that might be helpful for your LLC. To apply for your new LLC checking account, you should have the below information on hand:
- A printed or digital copy of your company’s Articles of Organization
- Your LLC’s EIN (if you’re a sole-member LLC without an EIN, you’ll need your SSN)
- A printed or digital copy of any specific business licenses and/or permits your LLC obtained
From there, the setup process should be quick, depending on the bank you choose and whether you apply online or in-person. Once set up, you’re ready to begin managing your money. You can even apply for additional financing, such as loans or grants.
Secure Insurance for Your Ohio LLC
Ensuring insurance compliance is another important step to take after your Ohio LLC has been registered. You’ll need to make sure you have the proper insurance coverage required to operate to protect your company and employees. Some of the most common types of business insurance are:
- General liability insurance: This type of insurance offers general protection to your company in case of a lawsuit. Some states require this insurance, but Ohio does not.
- Professional liability insurance: This type of insurance offers coverage for professional providers, including consultants, lawyers, and accountants. It offers extra protection in addition to general liability to protect your LLC from malpractice and other lawsuits.
- Workers’ compensation insurance: This type of insurance offers coverage for your company’s employees in the event that they become injured, ill, or pass away at work. This insurance is not required in all states, but workers’ compensation insurance is required for companies in Ohio with more than one employee. However, Ohio typically makes exceptions for certain business types, including LLCs.
More specific types of insurance might be required depending on your LLC’s industry. Other common types of insurance to consider include commercial, property, auto, life, and umbrella insurance.
Additional Setup Costs for Your LLC
Registering your business, securing licenses and insurance, and getting set up to launch all have their own costs. While we’ve helped you calculate the administrative expenses you can expect, there are additional setup costs to consider.
Some of these costs include hiring new employees, securing record-keeping and financial software, and partnering with consultants or accountants to help manage and run your LLC.
You’ll also want to consider any other costs your LLC might require, such as securing office space (and furniture and supplies to go in that space), buying business materials (computers, marketing essentials, printers, etc.), or purchasing company vehicles, if required.
While you may have secured a domain, you’ll also need to consider the cost of creating a website, whether hiring an employee to handle this or outsourcing the role. ZenBusiness can help you get set up with a business email account and can handle your website maintenance as part of one of our business packages.
Ohio LLC FAQs
- What is the processing time to form my Ohio LLC?
In just three to seven business days, your Articles of Organization will be processed with the Ohio Secretary of State. However, you can pay additional fees of up to $300 to have your paperwork processed in as little as four hours.
- Do I need to file my Operating Agreement with the state of Ohio?
No. The Operating Agreement is an internal document that you should keep on file for future reference. While some states legally require LLCs to have an Operating Agreement, Ohio does not. However, creating an Operating Agreement is generally recommended to protect your company.
- What tax structure should I choose for my Ohio LLC?
The state of Ohio does not require a general business license, but you might need a specific license, depending on where you are or what type of business you are running. View the Ohio Business Gateway Licenses and Permits page to find out more. Be aware that you’re responsible for finding any federal, state, local, or industry-specific licensing your business is required to have.rnrnWhen it comes to insurance, the types of insurance required vary by how many employees you have and the industry you are in. They can range from professional liability insurance to unemployment and workers’ compensation insurance. You can find more information on the Ohio Department of Insurance website.rnrnIn both instances, we recommend hiring a professional service like ZenBusiness to do the research for you. We will provide you with a comprehensive package of all the licenses and insurance required for your Ohio LLC and help you file any necessary paperwork.
- Is there an annual fee for an LLC in Ohio?
While most states require LLCs to file annual reports and pay annual fees, Ohio does not.
- How do I change and update my LLC paperwork in Ohio?
The way you run your business, the people involved in managing your business, and your industry might evolve. Maybe you hired a new partner to help grow your LLC, the old owners retired, you decided to change your company name, or you opted to hire an outside registered agent service. All of these changes are normal for companies to incur over time but will require making adjustments to your LLC paperwork to keep the Ohio government updated.rnrnHere are some common situations that may occur over time and how to update your paperwork:rnrnYour registered agent or their information changes:rnrnIf your LLC hires a new registered agent or if you need to update their operating address, you’ll need to fill out a Statutory Agent Update form to change the necessary fields. You can submit this form online using the Ohio Business Filings portal or via mail.rnYou’ll need to pay a $25 filing fee.rnrnUpdating your LLC name:rnYou can update your LLC name by filing the Domestic Limited Liability Company Certificate of Amendment or Restatement and following the instructions on the form. This can also be done online. You’ll need to pay a $50 filing fee.
- How do I dissolve an LLC in Ohio?
If you decide you need to dissolve your LLC in Ohio, you can easily handle this online or through the mail by filing your Ohio Certificate of Dissolution. There is a $50 filing fee.