An LLC is a popular structure for many small business owners in Oregon because it offers flexibility and a variety of key benefits. It’s fairly simple to set up and allows owners to do things like open a business bank account, pay taxes and protect their personal assets in the event of a lawsuit. But, setting up an LLC still requires that you file the proper paperwork and pay the necessary fees required by the state. Here is a look at how to create an LLC in Oregon.
Is an LLC Operating Agreement Required in Oregon?
No, an operating agreement is not required in the state of Oregon. However, it is strongly recommended by many experts. An Oregon operating agreement is a legal document that sets the rules and procedures of the business. It outlines all the important financial and operational decisions of the company and allows members and managers to decide how the company will be run.
There are two types of LLCs recognized by the state of Oregon:
- Single Member LLCs
- Multimember LLC’s
If you are starting a business alone, you will file a single-member LLC. If you are setting it up with one or more other people, you will set up a multimember LLC. An operating agreement is often more useful for multimember LLCs because it outlines how much of the business each member owns and establishes how the company will be run and organized.
However, it can also be useful to those filing a single-member LLC as well. If you are researching how to get an LLC in Oregon, you should consider whether or not you plan on setting up an operating agreement, so that you file the correct paperwork.
Oregon Operating Agreement Laws
The official rules governing how to set up an LLC in Oregon can be found in Chapter 63 of Oregon Administrative Rules. Although members of an LLC are generally allowed to run their business in whatever way they see fit, there are a few specific rules required by law.
The name of the business must be different from any other business registered with the Secretary of State. You can check the Oregon Business Directory to find out if anyone else has already claimed a name you’re interested in taking.
In addition to being unique, the name of the business also must contain the words Limited Liability Company or the abbreviation LLC or L.L.C. This lets any interested parties know exactly how the business is structured.
Oregon LLCs are also required to have a registered agent. A registered agent is a person or business responsible for receiving any official documents on behalf of the company. So, if the LLC gets sued, the registered agent will be the one who will be served the paperwork. This can be a person or a business entity, such as another LLC. But, they must have a physical street address in the state of Oregon. If you are planning on setting up an LLC in Oregon and do not have a physical address in the state, you can use a registered agent service.
How Much Does it Cost to Form an LLC in Oregon?
The cost to file the Articles of Organization – Limited Liability Company with the Oregon Secretary of State is only $100. This is the document that officially registers your company with the local government and allows you to do things like get an EIN number and set up bank accounts.
Oregon also requires that members file an annual report each year. This lets the government know that the company is still in business and no major changes have been made. The cost to file an annual report in Oregon is $100 for domestic LLCs and $275 for foreign LLCs.
How to Form an LLC in Oregon
So, we’ve covered all the important laws and costs associated with setting up an LLC. But, you may still want to know how to register an LLC in Oregon. Follow these simple steps.
Step 1 – Choose a Name
The first step is to come up with a unique name for your business. Don’t forget to include Limited Liability Company, LLC or L.L.C. at the end. But other than that, it can be anything you want (as long as it doesn’t contain any vulgar language or other words and phrases that are prohibited).
Step 2 – File the Articles of Organization
Next, you’ll want to fill out the Articles of Organization Limited Liability Company and file them with the state. This document should include information such as the name and address of the business, the name and address of the registered agent, the duration of the LLC (if applicable), what kind of business the LLC will be conducting, and so on. The articles of organization can be filed online or by mail, but don’t forget the $100 filing fee.
Step 3 – Fill Out the Operating Agreement
You can skip this step if you decide not to use an operating agreement. It’s not required by law but can help you better organize your business and lay the ground rules from day one. If you do plan on using an Oregon operating agreement, it should be filed alongside the articles of organization.
Step 4 – Set Up An EIN
The next thing you’ll want to do is get an employee identification number (EIN) from the IRS. Even if you don’t have any employees yet, it’s still important to get an EIN. This is like the social security number for your business and will be needed to file your taxes and open bank accounts.
Step 5 – Comply with Other Regulatory Requirements
Once you’ve filed all the necessary paperwork and set up an EIN, all that’s left to do is be sure that you comply with any other regulatory requirements such as acquiring business licenses or permits and paying your taxes on time. Also, don’t forget to file the annual report each year and pay the $100 filing fee (or $275 if it’s a foreign entity).
Oregon LLC Operating Agreement Template
So that’s everything you need to know about how to start an LLC in Oregon. If you need an Oregon Operating agreement template to help structure your business, you can find one below: