You’re ready to take the plunge into entrepreneurship. But before you can start raking in the dough, you need to set up your business as a legal entity. In Oregon, that usually means forming an LLC, or Limited Liability Company. Not only does this protect your personal assets in the event that your business is sued, but it also makes it easier to get funding and enter into contracts. Plus, LLCs are relatively simple and straightforward to set up. Here’s everything you need to know about how to start an LLC in Oregon.
Before we dive in, here’s a really good explanation video on starting an LLC in Oregon for those who prefer a video guide.
Benefits of starting an LLC in Oregon
There are many benefits to starting your LLC in Oregon. As expert start-up guides will advise you, it has the advantage of limited liability protection for its members. It’s more compact than a Corporation or S Corporation.
Limited Liability Protection
One of the most significant benefits of starting your Oregon business as an LLC is that it offers limited liability protection, which means that if a lawsuit arises from a customer or client for something you did while operating your business – it won’t follow you home. Rather than the people who own it, the business itself is liable for paying out any damages.
Your personal assets, such as your car or house, are separated from your Oregon business assets and aren’t at risk of being taken away if someone sues your business for something you did wrong. Many entrepreneurs start their businesses as LLCs because of this benefit.
An LLC in Oregon has the choice of being taxed as a Sole Proprietorship, Partnership, or Corporation. It’s a good deal for start-ups since they don’t have to worry about finding an accountant or anything like that just yet.
Note: Single-Member LLCs are treated as Sole Proprietorships by default.
Minutes of meetings not required
Lastly, one of the benefits of starting your LLC in Oregon is that no minutes are required for meetings. People don’t have to travel for monthly meetings or anything like that. They need to follow the operating agreement, which doesn’t take too many hours out of the day.
Oregon LLC Rules & Requirements
This is a quick summary of the most important rules and requirements that this article will go through in-depth.
To apply for permission to form an LLC in Oregon, the company must have a in Oregon. Your LLC’s name must include “Limited Liability Company,” or their abbreviation, “LLC.” It can’t be something that resembles another already existing business. Ensure you as a business owner keep accurate records and reports of your business transactions.
Best Oregon LLC Formation Services
If you’re thinking about starting your LLC in Oregon, it’s a good idea to use a professional service that can handle the process for you. These services will ensure you get all the necessary paperwork filed correctly and timely so that you don’t have to worry about anything going wrong with your business registration.
Finding the Best LLC Formation Services in Oregon
Choosing the best LLC formation services in Oregon is an essential first step for anyone looking to start their own. Here are some of the most critical factors you’ll want to consider:
- Customer service/communication
- Integration with accounting software (if necessary)
These factors will help you narrow down your list of potential providers to find the one that provides you with the professional service you need at an affordable price. We have reviewed some of Oregon’s best LLC formation services here: Best LLC Formation Services.
As mentioned above, it’s usually recommended that if you’re unfamiliar with this kind of thing, then you should consider allowing LLC formation service providers to help you start your own business here in Oregon. These services will ensure that you comply with state law and all the rules and requirements. If anything goes wrong, they’ll have your back so that you don’t have to worry about it.
However, if you’re looking to do it on your own, then you can continue reading our guide on how to start an LLC in the state of Oregon.
The following is a step-by-step guide of what you can expect when forming an LLC in Oregon:
5 Steps to Starting an LLC in Oregon
- Name your Oregon LLC
- Choose your Oregon Registered Agent
- File your Oregon LLC Articles of Organization
- Create your Oregon LLC Operating Agreement
- Get an EIN for your Oregon LLC
Step 1: Name your Oregon LLC
Choosing your name can be one of the most challenging parts of starting your Oregon LLC. You’ll have to choose a name that’s not already in use by another Oregon LLC or restricted by the state.
The rules for naming your Oregon limited liability company are as follows:
- Your name cannot mislead people into thinking the Oregon LLC was set up by the government or is a federal government agency.
- The name can’t be too similar to another Oregon company’s
- Your name has to end with an LLC designator (LLC, LTD., etc.)
- You may need to fill out additional paperwork if you want to use certain words in your Oregon LLC name, including bank, trust, trustee, incorporated, Inc., and corporation.
- If you want to see if a specific LLC name is available, you can run a business name search on the Business Entity Search page of the Oregon state website.
After choosing the perfect name for your new Oregon business, you can also secure a good domain name. A domain name is also helpful if you want a business email address @yourllc.com.We recommend using Namecheap to register your domain. They have great prices, fast service, and an easy-to-use website.
Step 2: Choose your Oregon Registered Agent
Before you form your LLC in Oregon, you’ll need to appoint a registered agent with a physical street address in the state of Oregon. This person or entity would be responsible for receiving essential documents on your behalf if anything happened that would require that sort of thing (lawsuits, etc.). You can name yourself as your Oregon registered agent, but that isn’t advisable because you would not be able to claim any anonymity.
What is a Registered Agent?
An Oregon registered agent is an individual or business entity that agrees to accept the service of process on behalf of a Limited Liability Company.
When you create a Limited Liability Company in Oregon, the State of Oregon requires that this registered agent be appointed for your LLC to become effective. The Oregon Secretary of State’s Office will not file your Articles of Organization unless you designate a registered agent on your application form.
Who can be a Registered Agent in Oregon?
For a registered agent, you can select a person or an organization. The individual can be an Oregon resident, an Oregon corporation, or a non-Oregon corporation with a business presence in Oregon.
You can also use an Oregon registered agent service to appoint a registered agent and obtain a business address. Services such as Zenbusiness and Northwest Registered Agent offer this service as a feature of some of their packages when you register an Oregon company with them.
What does a Registered Agent in Oregon do?
A registered agent in Oregon is available during normal business hours to accept important documents and notices on behalf of your LLC. These can be official court papers such as lawsuits or service of process documents that will require the registered agent’s signature.
A registered agent is not responsible for the management of your Oregon LLC, nor are they required to do anything with the documents once they are received at their business address except for filing them under Oregon law.
Step 3: File your Oregon LLC Articles of Organization
You’ve chosen your Oregon name and appointed a registered agent, and now it’s time to create your LLC and become a recognized legal entity.
Before filing, you will need to decide between a member-managed and manager-managed LLC. The members run a member-managed LLC, while a designated manager runs a manager-managed LLC.
To start an LLC in Oregon, you’ll need to file your Articles of Organization with the Oregon Secretary of State, which can be done online. The online filing fee is $100, and a person must file this with authority to do so on behalf of the Oregon LLC.
File your Oregon LLC Articles of Organization Online
You’ll need the following documents to submit your papers:
- The official name of your Oregon LLC
- A brief description of the purpose of your Oregon LLC
- Your Oregon LLC’s street address
- Your Oregon registered agent’s name and address
- The signature of your registered agent
- Your LLC’s authorized person’s signature
- Your return address
You can submit your Articles of Organization through Oregon’s online business filing system.
File your Oregon LLC Articles of Organization by Mail
If you choose not to file online, you can also mail your Articles of Organization to the Secretary of State. The filing fee is $100 and a person must sign the formation documents with authority to do so on behalf of your Oregon LLC. You’ll need the download the filing form and mail it.
Secretary of State, Corporation Division
255 Capitol St. NE
Salem, OR 97310
Step 4: Create your Oregon LLC Operating Agreement
After filing your Oregon LLC Articles of Organization, you will want to create an Operating Agreement.
An operating agreement is an internal document that sets out the internal rules of your Oregon LLC. These rules address issues such as how LLC owners will spend the money, whether voting takes place within your business, what happens if someone wants to sell their interest in the company etc.
Oregon does not require an LLC to have an operating agreement, but it is recommended that you create one. An operating agreement ensures that all members know and understand their roles within the company. If they ever need to take legal action, they will show a court of law that the company functions as more than just an unincorporated association.
This operating agreement should be thorough but concise, outlining everything you want to include regarding the membership responsibilities of your Oregon LLC, so there are no misunderstandings down the line.
The operating agreement will also be necessary when you open a business bank account in Oregon.
Step 5: Get an EIN for your Oregon LLC
An EIN, or Employer Identification Number, is a unique number that the IRS issues to businesses for tax purposes. An EIN is like your business’s social security number. You can use it to file state or federal-level tax returns and financial statements with different government agencies or open a business bank account.
An EIN is required for several reasons. First, as mentioned above, it is needed to open a business bank account for your Oregon LLC. You will also need an EIN to hire employees, as it is used on employment tax forms. Finally, an EIN is often required when filing your business taxes.
After you receive your EIN, you will be informed of your Oregon LLC’s various tax classification options.
Internal Revenue Service
Attn: EIN Operation
Cincinnati, OH 45999
Applying for an EIN for your business is free of charge.
Oregon LLC Processing Time
Online filings take 5-7 hours for the state of Oregon to process your Articles of Organization and approve your LLC.
If you choose to file by mail, the processing time is approximately 5-7 business days.
Oregon LLC Frequently Asked Questions
How much does it cost to start an LLC in Oregon?
The online filing fee is $100, and the mail filing fee is $100 in Oregon.
How do I set up an LLC in Oregon?
Step 1: Choose a name for your Oregon LLC
Step 2: Choose an Oregon Registered Agent
Step 3: File the Articles of Organization
Step 4: Create an Operating Agreement
Step 5: Get an EIN
Is there an annual fee for LLC in Oregon?
The annual filing fee is $100 in the state of Oregon.
How long does it take to start an LLC in Oregon?
It takes 5-7 business days to start an LLC in Oregon when filing by mail and 5-7 hours when filing online.