Guide to Forming an Ohio LLC

1. Name your Ohio LLC

You’ll start by finding a name for your Ohio LLC. There are so many businesses out there, and many may be in the same industry you want to join. Start your business with a unique name that will differentiate you from them. Not only does it have to be unique, but it also has to follow the naming rules that Ohio has set for businesses.

Naming Requirements for Ohio LLCs

Ohio has several naming rules for businesses. The information we’ve provided below is a general breakdown of the much more detailed rules that you can find on the Secretary of State’s “Guide to Name Availability” page. There, you’ll find more rules concerning punctuation, contractions, abbreviations, tenses, and more.

General Ohio LLC Naming Rules

Under Ohio law, your business’s name must be distinguishable from the names of other companies previously registered with the Ohio Secretary of State. These include:

• Other LLCs
• Limited liability partnerships (LLPs)
• Limited partnerships (LPs)
• Domestic corporations
• Licensed foreign corporations
• Trade names
• Reserved names
• Some business names can be subject to additional naming requirements/restrictions. For example, if a business plans to use the word “trust,” “bank,” “banking,” or something similar in its name, it must have approval by the Ohio Department of Commerce – Division of Financial Institutions before filing its Articles of Organization.
• A business entity can’t contain words that are considered profane. It also can’t contain phrases that are considered slurs against ethnic groups, genders, religions, or heredity.
• The business name can’t imply an affiliation with a government agency. For example, a business can’t have “F.B.I.” in its name if it’s unaffiliated with that agency.
• The business name must have a designator identifying its business structure. For an LLC, appropriate designators would be:
  • Limited liability company
  • L.L.C.
  • LLC
  • Limited
  • Ltd.
  • Ltd

How do you go about checking if the name you want is free to use? You can check out our Ohio Business Entity Search page for instructions on how to conduct a search for yourself. Keep in mind that name search engines aren’t perfect. You can double-check to make sure your name is available by contacting the Secretary of State at (614) 466-0562.

Reserving an Ohio Business Name

Once you’ve decided on the perfect name and it’s available, consider reserving it. This way, no one else will be able to claim it while you get your paperwork together. You can reserve your name for 180 days. During that time, you can focus on setting up your LLC.

Get a domain name for your LLC in Ohio

Selecting an appropriate domain name for your Ohio LLC’s business website and aligning it with your legal business name is a critical step in establishing a strong online presence. Your domain name is often the first point of contact between your business and potential customers. It should be memorable, reflective of your brand, and easy to spell, helping people find and remember your website effortlessly. Moreover, matching your domain name with your legal business name fosters consistency and professionalism, instilling trust and credibility in your audience.

It also aids in brand recognition and search engine optimization (SEO), improving your website’s visibility in online searches. By carefully choosing and aligning your domain name with your legal business name, you create a unified and authoritative online identity, essential for attracting customers and building a reputable online brand for your Ohio LLC.

Is your Ohio LLC name available as a web domain?

One thing to consider when deciding on a name for your LLC in Ohio is its availability as a web domain. Finding a name that can also be used as a URL means having a business website where customers and clients can find you online.

Check out our domain name search tool and find out if the business name you want is available to use as a URL. If it is, then you may want to get it before anyone else does. That way, you can extend your reach and serve customers outside of your physical location. This can also offer an extra marketing advantage since you can promote your business through social media via your business website.

We offer a domain name service that can help you find and buy a domain name. We can also help you put together a business website with domain name privacy.

Trademarking Your Ohio LLC’s Name

You should know that, even if it appears that the name you want is clear for the taking, that doesn’t necessarily mean you can. Business names can be trademarked, so you’ll need to make sure that the one you want is 100% available. Trademarking a business name isn’t required, but it can add additional protection that prevents other businesses from using it.

You can do so at the state and federal levels. For Ohio trademarks, you’ll need to submit Form 555 with the Ohio Secretary of State. For federal trademarks, visit the U.S. Patent and Trademark Office website.

Filing for a “Trade Name” or “Fictitious Name” in Ohio

You’re free to do business under your LLC’s legal name, but you also have the option to use a different name. This is where a “fictitious name” or a “trade name” comes into play. In some other states, this option is known as a “doing business as” (DBA) name.

Trade names need to be distinguishable from other Ohio company names, so you’ll have to conduct another name search. A fictitious name, on the other hand, doesn’t require this. This means that trade names can provide greater protection. You can learn more about trade names and fictitious names in Ohio by checking out Section 1329.01 of the Ohio Revised Code.

2. Appoint a statutory agent in Ohio

Appoint a statutory agent for your Ohio LLC. The state requires all businesses to have a statutory agent, commonly known as a registered agent in some other states. This person or entity accepts any legal documents in person on behalf of the LLC in Ohio and relays them to the LLC’s leadership.

This agent must be available at a physical address, known as a registered office, in Ohio during regular business hours. You’ll need to appoint a statutory agent for your LLC in Ohio when filing the Articles of Organization with the Secretary of State. When filing, you’ll need to include a written acceptance signed by the agent along with the agent’s name and address.

Who can be a statutory agent for an LLC in Ohio?

Ohio has requirements for who can serve as a statutory agent. They include one of the following:

• A natural person who is a resident of Ohio.
• One of these entities with a business address in Ohio:
  • Limited liability company
  • Limited liability partnership
  • Limited partnership
  • Limited partnership association (LPA)
  • Professional association (PA)
  • Partnership
  • Domestic or foreign corporation
  • Nonprofit corporation
  • Unincorporated nonprofit association (UNA)
  • Business trust

What if my statutory agent resigns?

Your LLC must maintain a statutory agent. If yours happens to resign, then you’ll need to file some paperwork with the Ohio Secretary of State. A form called “Statutory Agent Update” (Form 521) will need to be filed if your statutory agent resigns, dies, or is no longer able to perform their duty.

This form will also need to be submitted if your current statutory agent changes their name and/or address. Failing to file this form if any change to your statutory agent occurs can have some repercussions. The LLC’s Articles of Organization may be canceled, and other issues can come up.

Can I be my own statutory agent?

Yes, you can be your own statutory agent in Ohio. If you’re considering this, you should also consider some downsides that may make you rethink things:

• The statutory agent must be available at their registered address during regular business hours. This means that you’ll have difficulty going out to run errands, taking a sick day, meeting clients, etc.
• If you’re served with the notice of a lawsuit, then it’ll be given to you in person at the LLC, potentially making you look bad in front of clients and customers.

ZenBusiness can provide your statutory agent

Our registered agent service can provide you with a statutory agent who will receive important legal documents and notices on your behalf. This service keeps your business compliant by ensuring that you have a statutory agent at all times for your LLC.

What makes the service great is that you won’t have to worry about performing the duties of this agent, meaning you’re free to run the business without being anchored to your office. You can run errands, meet customers and clients, and run your business your way.

This service also keeps documents issued to your LLC organized. They’ll be ready to view, download, and print through your ZenBusiness customer dashboard.

3. File Ohio Articles of Organization – Form 610

File your Articles of Organization with the Ohio Secretary of State. In order to make your LLC in Ohio official, you’ll have to file with and get your documents approved by the Secretary of State. You’ll do this by submitting Form 610. The filing fee is $99.

If filing government documents is the last thing you’d like to do, then check out our business formation plans. We can handle your filing needs while making sure all information included is correct. If you’d prefer to do this yourself, then read on.

Create a profile on the Business Filings page

If you plan to file your Articles of Organization online, then you’ll first have to create a profile on the Ohio company filings page. You’ll need to provide a username (email address), password, and an e-signature.

How to Expedite Ohio LLC Articles of Organization

The Secretary of State usually processes within three to seven days depending on the volume of other filings. The good news is that it offers expedited service. It comes in three levels:

• Level 1 can be submitted online, in person, or by mail for a $100 fee for a turnaround time of two days.
• Level 2 can only be submitted in person or online for a $200 fee for a turnaround time of one business day.
• Level 3 can only be submitted in person or online for a $300 fee for a turnaround time of four hours. For this option, filings that are submitted after 1 p.m. will be available the following business day.

When does my LLC’s formation become effective?

According to Ohio Revised Code Section 1706.16(D), “A limited liability company is formed when the Articles of Organization are filed by the Ohio Secretary of State or at any later date or time specified in the document.”

Additionally, Ohio Revised Code Section 1706.172(D) states that an LLC’s Articles of Organization can specify an effective time and a delayed effective date not exceeding 90 days following the date the Ohio Secretary of State receives the Articles.

Information Needed for Ohio Articles of Organization

When filing your Articles of Organization, you’ll need to include some important information per Ohio Code Section 1706.16. The form details what to include:

• The LLC’s name, which must include one of the designators mentioned in Step 1.
• The statutory agent’s information (name and address) as well as their acceptance of appointment.
• A statement showing that the LLC may have one or more series of assets subject to limitations, if applicable. This reflects division (B)(3) of section 1706.761 of the Ohio Revised Code.
• Any other important matters that the organizers or members feel are important to include in the Articles of Organization.

The Articles can also additionally include the LLC’s effective date and time (if different from the filing date) and the company’s purpose. Keep in mind that if you need to make any changes to the Articles in the future, then you’ll need to file an Ohio Certificate of Amendment or Restatement (Form 611).

We offer an amendment filing service that can take care of this for you, too. You can also check out our Worry-Free Compliance service. It includes two amendment filings every year.

Member-Managed or Manager-Managed?

Ohio is in a unique spot when it comes to member-managed and manager-managed LLCs. A member-managed LLC is governed by the members. A manager-managed LLC is governed by a manager. Deciding which structure would be chosen would normally be laid out in the operating agreement. However, the Ohio Revised Limited Liability Company Act passed in February of 2022 changed the rules.

According to the Secretary of State’s website, “The new LLC Act eliminates the distinction between member-managed and manager-managed limited liability companies. A person’s ability to act as an agent, and bind the limited liability company, can be authorized by either the operating agreement; decisions of members in accordance with the operating agreement; a Statement of Authority (Form 613) filed with the Ohio Secretary of State’s office; or the LLC Act’s default rules.”

In other words, an LLC’s leadership is free to choose a management structure that works best for them, whether that structure follows the previous act or incorporates other governance mechanisms. This must be included in the operating agreement.

Keep track of your business documents

If you choose us to file your Ohio Articles of Organization, then your paperwork will be ready and available to view on your ZenBusiness dashboard when it’s approved. This dashboard allows you to keep all your important business documents digitally organized. Make sure to take care of your physical forms, too.

4. Create an operating agreement

Create an operating agreement for your Ohio LLC detailing how the company will be organized and run. This document isn’t required for filing in Ohio, but drafting one can provide several benefits that could help you run your Ohio LLC smoothly in the future. An operating agreement outlines member roles, profit distribution, and decision-making processes, essential for internal governance and external transactions.

Benefits of an Ohio LLC Operating Agreement

We know that dealing with business documents isn’t fun, but to help your business run well, consider an operating agreement. Here are some benefits:

• Operating agreements enhance the LLC’s liability status, allowing you to clarify which assets are personal and which are business.
• It clarifies any verbal agreements between the members/managers. Consider getting agreements in writing and keeping them organized in your OA.
• It allows you to run the limited liability company however you want so long as no laws are being broken.
• It further legitimizes the LLC, making it look much more organized, planned out, and professionally run.
• Operating agreements can make it easier to get a loan since financial institutions sometimes require them.

What should I include in my Ohio LLC’s operating agreement?

You can include pretty much whatever you want in your operating agreement. Some basic items include:

• Why the limited liability company is being formed and which services/products it will offer.
• The names of the members.
• The contributions to be made by each member.
• The ownership interest of each member as well as the division of profits and losses.
• Each member’s voting rights when it comes to business-related matters.
• Detailing how new members will be added to the limited liability company.
• Detailing the reasons for and process of removing a member from the LLC.
• Organizing meetings, if any.
• The reasons for and process of dissolving the LLC.

After the LLC operating agreement is drafted and all members agree to it, it should be signed by everyone. Our operating agreement template can help you get started if you aren’t sure how to create one.

Do I need an LLC operating agreement even if I’m the only owner?

Since an operating agreement mostly aims to detail how the LLC will be run, it may seem pointless to have one if you’re the only owner, right? Well, an operating agreement may still be of great benefit to a single owner. Potential investors, banks, future business partners, and others will probably want to see your operating agreement to ensure that you’re serious about running the company.

Banks, for example, sometimes request an operating agreement before opening a business bank account or granting a loan. The operating agreement can also be used to stipulate what will happen to your limited liability company if you become incapacitated or die. And if you’re taken to court, the operating agreement can be used to further show that you and the business are different entities, thereby protecting your personal assets.

6: File the beneficial ownership information report

The Corporate Transparency Act became effective at the beginning of 2024, meaning LLCs and other small businesses are required to file a beneficial ownership information report. This report gives the Financial Crimes Enforcement Network (FinCEN) information about the people who own and operate a business, making it harder for organizations to hide illicit financial activities behind shell companies. 

When you file, you’ll be asked to provide the legal name, address, and identifying documents for each beneficial owner. Under the act’s terms, a beneficial owner is anyone who owns 25% or more of the LLC’s ownership interest, exerts substantial control over the business, or gets significant economic benefit from the business. 

You can file this report online or by uploading a PDF, and there’s no filing fee. For LLCs that form during 2024, the due date is 90 days after Ohio approves your Articles of Organization. Then for LLCs formed before 2024, the due date is January 1, 2025. LLCs created in 2025 and beyond will have just 30 days to file. Ohio doesn’t have a state version of this form, so you’ll only need to do the federal filing. 

You can learn more on FinCEN’s website. Our BOI report filing service can help streamline this process for you.

Register for LLC for Business Taxes in Ohio

You’ll need to register with the Ohio Business Gateway website. Here, you can find filings for the Department of Taxation, which includes the Commercial Activity Tax (CAT), Employer Withholding, local sales tax, and more.

Additionally, you can visit the Ohio Department of Taxation website to obtain important information regarding the state’s taxes. This includes registration requirements, filing due dates, and filing requirements. You can also take advantage of the Ohio Small Business Tax Training Program to help you better understand Ohio’s tax requirements. It pays to learn about sales tax.

Can filing as an S corp lower my taxes?

We should point out that an S corporation is not a business structure like an LLC. It’s simply a tax designation that an LLC can apply for. If an LLC only has one member, it’ll be taxed as a sole proprietorship. If it has two or more members, it’ll be taxed as a partnership.

Entrepreneurs find LLCs appealing because they avoid “double taxation.” This means paying taxes at the business and individual levels. As great as this is, an LLC can apply for S corp status to save additional money on self-employment taxes.

Filing as an S corp allows you to be both an owner and an employee of your LLC. As an “employee-owner,” you can divide your income into your salary and the share you hold of the company’s profits. You’ll then only have to pay self-employment taxes on your salary and not your profits.

Keep in mind that the IRS watches S corps more closely, meaning you could be at a higher risk of an audit. S corp status is also harder to qualify for. Speak with a licensed tax professional for guidance.

Open a business bank account using your EIN

Establishing a separate bank account for your Ohio LLC is a foundational step crucial for the success and compliance of your business. First, it ensures the vital legal separation between your LLC’s financial affairs and your personal finances, a prerequisite for maintaining the limited liability protection the LLC structure affords. Without this distinction, personal assets could be exposed to potential legal issues or business debts, putting your financial security at risk.

Secondly, a dedicated business bank account simplifies various aspects of running your Ohio LLC. It streamlines compliance by consolidating all business transactions in one place, aiding in the meticulous record-keeping required for tax filing.

This professional separation of finances enhances your company’s credibility when dealing with clients, vendors, and partners. Additionally, it facilitates tax efficiency by making it easier to track income and expenses, allowing for accurate financial statements and the identification of deductible business expenses, ultimately reducing your tax liability.

Moreover, a separate account aids in financial planning, providing a clear financial snapshot for better cash flow management, tax preparation, and informed decision-making regarding investments and growth strategies.

Take control of your Ohio LLC’s finances

We offer a discounted business bank account in order to help business owners better manage their finances. With this service, you’ll get a debit card, unlimited transitions, and more. If you’d like to authorize others to use this account, then check out our banking resolution template.

Try ZenBusiness Money for additional help with your business’s finances. You can receive payments, manage clients, transfer money, and create invoices.

What are the benefits of an LLC in Ohio?

Forming an LLC in Ohio offers a range of benefits, combining the advantages of the LLC structure with Ohio-specific perks and a business-friendly environment. Here’s a breakdown of the benefits of starting an LLC in Ohio:

Common Benefits of Forming an LLC:

• Limited Liability: Like LLCs in other states, forming an LLC in Ohio provides owners (known as members) with limited liability protection. This means that members’ personal assets are typically shielded from business debts and liabilities, safeguarding their financial security.
• Pass-Through Taxation: Ohio LLCs enjoy pass-through taxation, where business profits and losses are reported on the members’ individual tax returns. This simplifies taxation and avoids the double taxation typically associated with corporations.
• Flexible Management: Ohio LLCs have flexibility in how they’re managed. Members can choose to manage the LLC themselves or appoint a manager. This adaptability allows businesses to tailor their management structure to their specific needs.

Benefits Specific to Ohio:

• Business-Friendly Laws: Ohio’s legal framework for businesses is designed to be business-friendly, with well-defined regulations that offer clarity and predictability to entrepreneurs. This fosters a stable and supportive environment for starting and operating an LLC.
• Affordable Startup Costs: The cost of forming an LLC in Ohio is relatively low, making it accessible for entrepreneurs and small businesses. The filing fee for Articles of Organization with the Ohio Secretary of State is reasonable, making it an affordable option for startups.
• Access to Resources: Ohio offers access to various resources for businesses, including business development centers, incubators, and networking opportunities. These resources can help startups grow and thrive.
• Proximity to Markets: Ohio’s strategic location in the Midwest provides businesses with proximity to major markets, including Chicago, New York, and Toronto. This central location can be advantageous for businesses engaged in manufacturing, distribution, or logistics.
• Workforce: Ohio boasts a skilled and diverse workforce, with access to top-tier universities and educational institutions. This can be especially advantageous for businesses seeking to recruit and retain talent.
• Innovation Ecosystem: Ohio is home to a growing innovation ecosystem, with tech hubs and research centers in cities like Columbus, Cincinnati, and Cleveland. This environment can benefit technology startups and innovative ventures.
• Economic Incentives: Ohio offers various economic incentives and programs, such as tax credits and grants, to encourage business growth and investment in specific industries. These incentives can provide financial support to qualifying businesses.

Before starting an LLC in Ohio, it’s advisable to consult with legal and financial professionals who are knowledgeable about Ohio’s regulations and incentives. They can guide you through the process and help you make the most of the benefits of forming an LLC in the state.

Ohio LLC Tax Information

Understanding Pass-Through Taxation for Ohio LLCs

LLCs avoid “double taxation,” meaning that the business isn’t required to pay federal income tax. Instead, the income passes through to the LLC owners. Each owner will then pay taxes on the company’s earnings as regular income. This structure differs from corporations, where the company’s profits are taxed twice, at the business level and shareholder level.

How LLC Owners Are Taxed on Business Earnings

The IRS also taxes LLC owners based on their share in the LLC. For example, if an owner owns 20% of the business, then they’ll be taxed 20% of the business’s earnings.

Options for LLC Taxation: C Corp and S Corp Statuses

LLCs can also opt to be taxed as a C corporation or an S corporation. C corp status means being subject to double taxation. S corp status, however, avoids it. Plus, some LLC owners can save more in self-employment taxes with an S corp status. Keep in mind that S corp status catches more attention from the IRS and has more restrictions.

Benefits of S Corp Status for Ohio LLC Owners

The good news is that we can help you apply for S corp status. This is only possible during your LLC’s formation. If you already own an LLC, then you’ll need to request S corp status on your own with the IRS. Speak with a licensed tax professional for more information.

Navigating State Taxes for Ohio LLCs: Pass-Through and Beyond

For the state income tax, Ohio taxes LLCs as pass-through entities unless the company chooses to be taxed as a corporation.

Additional State Tax Obligations: CAT and Sales Taxes

A few other state taxes that may be imposed on your LLC include the Commercial Activity Tax (CAT) and sales and use taxes.

What tax structure should I choose for my LLC in Ohio?

This is something you should discuss with a licensed tax professional since many variables can play into your decision. What you should know is that many entrepreneurs go for a “pass-through” taxation structure.

LLCs automatically have this feature, but consider that you may lose it if you apply for C corp status. S corp status, on the other hand, retains pass-through taxation and can include additional tax benefits.