How to Start an LLC in Nebraska
If you are setting out to start a new business, you have many important tasks ahead of you. But one of the most important steps to take early on is to decide on a business structure, and then form the new company as a legal business entity. This guide is tailored for entrepreneurs in Nebraska who have decided on starting an LLC in NE.
LLCs, or limited liability companies, are a popular and efficient choice for many businesses. They offer substantial liability protection, helping shield the assets of the owner’s from the liability created by business activities. And, they are typically easier to set up – and to maintain – compared to a corporation or S-corp.
Starting a limited liability company in Nebraska will involve working with the Nebraska Secretary of State, and submitting the Certificate of Organization, among other requirements. The guide below will show you step-by-step how to start a Nebraska LLC.
Consider utilizing an LLC formation service
There are two ways to go about starting a Nebraska limited liability company: Do it yourself, or use a professional service.
If you do the work on your own, you’ll need to follow the steps below. Expect to spend some time researching requirements and completing all the necessary tasks and paperwork.
If you use a professional LLC formation service, you will have help for each step along the way. The service will make it easier to complete the process online, and simplifies the language used and steps required, making it easier for everyone to navigate the process.
If you choose to use a service, expect to pay around $50-$200+ for the service, depending on the package you choose. The cost is reasonable, considering that these services can save you many hours of time – and can also help to ensure that no mistakes are made.
Name your new company
Selecting a name for your company is the first real step in the process. You will need to decide on a name before you move on to filing any paperwork.
Obviously, you will want to find an appropriate name that is relevant to your business type, and that is memorable for customers. But on top of this, you will also need to follow certain guidelines:
- The name must be distinguishable from all other business names in the state of Nebraska. You can conduct a name search online to confirm if a name is taken or available. More information on this (and name reservations) can be found here.
- The name must include “limited liability company”, or an appropriate abbreviation such as “L.L.C.” or “LLC”
- The name cannot contain government-related phrases or words
- Restricted words (bank, attorney, etc.) need special permission in order to use in LLC names
Once you have found a good name that is available and meets the requirements, you can move on to step #3 below.
Using a trade name in Nebraska
Keep in mind that Nebraska also allows for the use of “trade names”, otherwise known as doing business as names or DBAs. These are secondary names, used primarily for branding purposes, that you can register. They are “attached” to your LLC, so the filing of a trade name does not actually create a new business entity.
Once your LLC is formed, you can register trade names in Nebraska. This allows you to do business under the formal LLC name, and/or the new trade name that you’ve registered. This provides more flexibility, and also allows a single LLC to be the parent company for several business operations.
Appoint a registered agent
Registered Agents are individuals – or businesses – that are appointed by LLCs to handle important correspondence and communications. Tax forms, notice of lawsuits, etc. will all go to the Registered Agent that is on file for a given LLC. Nebraska requires that all LLCs appoint a registered agent, and you will need the agent’s information before moving on to the next step.
Any Nebraska resident can be a registered agent – including yourself or an employee. Companies licensed in the state can also be registered agents – however, your LLC cannot serve as its own registered agent.
So, you can either appoint yourself (using your home address), or an employee. Or, you can hire a professional registered agent service.
Using a service will be worth the modest cost, in many cases. A service will run you around $100-$150 per year but will provide significant peace of mind and security – while also protecting your privacy.
Create an operating agreement
Note: This step is optional, but recommended.
Operating agreements are important internal documents that most LLCs should have on file. That said, they are not required by Nebraska, so this step is optional.
An operating agreement is a document that is drafted and agreed upon by all members/owners of the LLC. It establishes the basic operating procedures for the company, as well as the ownership details. It’s this last part that is key. For any business with multiple owners, operating agreements can help prevent conflict by clearly establishing ownership rights.
You can draft an operating agreement using a template provided by ZenBusiness. You can also hire a local attorney, although this could be costly.
File LLC Certificate of Organization
The Nebraska LLC Certificate of Organization must be filed with the Secretary of State in order to form an LLC in the state. This process must be completed online. There is a $100 filing fee (plus $5 per page).
To file this document, you must draft your own certificate, following the guidelines laid out in the Nebraska Revised Statute 21-117. Read these requirements carefully, and then draft a custom Certificate of Organization with the details of your business. Once you have completed it, the document can be uploaded online here.
Because Nebraska makes this step a bit more complicated by requiring a custom-drafted Certificate of Organization, many entrepreneurs in the state choose to use professional help with this step. Again, ZenBusiness and Northwest Registered Agent are great options for this.
Once the document has been submitted, you will need to wait for Nebraska to process the application. This could take up to 2-3 weeks. You will be notified when it is completed – or if there are any issues to be addressed.
Satisfy the Nebraska LLC publication requirements
Nebraska has a requirement that new LLCs must publish a Notice of Organization in a local newspaper for three consecutive weeks. This is essentially just a notice letting the community and business leaders know that your business has launched.
It must be published in a general circulation newspaper in the county in which the business’ principal office is located. The publication must run for three consecutive weeks. Nebraska newspapers are familiar with the requirement and make it easy to publish the notice.
Once your notice has run for three weeks, the newspaper will issue an Affidavit of Publication. You can then file this with the State of Nebraska online.
There is no fee for the filing itself, but you will need to pay the newspaper’s fees to actually publish the notice.
Apply for an EIN
Employer identification numbers, or EINs, are important tax ID numbers issued by the Internal Revenue Service. They are used for tax filings, communications with the IRS, and hiring employees. In fact, an EIN is required to hire employees.
It is easy to apply for an EIN online with the IRS. There is no cost to complete the application. You will be notified when your EIN has been issued.
Apply for business licenses & permits
Many Nebraska businesses will also need various other permits, business licenses, etc. in order to legally operate. The requirements vary substantially depending on the type of business, however, as well as the location(s) where the business plans to operate. More information on business licensing in Nebraska can be found here.
Depending on the business, there may be requirements on the state, federal and local levels.
Nebraska does not require a statewide business license in most cases. However, companies in certain industries may require state permits. For example, liquor licenses for restaurants and bars are state-level licenses. At this time, you will also want to register for an unemployment insurance tax account, and an employee withholding tax account with the Nebraska Department of Revenue.
Local authorities (city/county) will have various requirements that must be met. Most require a local business license. If you have a company with multiple locations, you may need multiple business licenses. Health permits and other industry-specific permits are often handled on the county level, as well.
Most LLCs will want to apply for an EIN (see #7 above). Other than that, certain industries that are highly regulated must obtain federal licenses. You will also want to research federal tax reporting requirements at this time.
It’s a good idea to thoroughly research your requirements now so that you can be fully prepared for the launch date of your new company.
Keep your business in good standing
Ongoing compliance tasks are equally important to the initial business formation process. Each year (and quarterly, in some cases), you will need to complete various tax filings, renewals, reports, and other compliance tasks.
The specifics do vary depending on the business you are running, where it is located, and what industry it is in. That said, here is a list of some of the most common ongoing requirements:
- Federal tax filings
- Federal quarterly taxes
- Federal employer taxes
- Nebraska employer taxes
- Nebraska sales taxes
- Nebraska Biennial report – due every 2 years
- Local tax returns
- Permit renewals for business licenses, professional licenses, health permits, etc.
- Ongoing Registered Agent appointment
This list is not exhaustive, so there may be other requirements. Much depends on the type of business you are running, and how regulated it is. It’s wise to spend the time now to fully research all your requirements so that you don’t miss anything. Calendar reminders for various due dates can also be quite useful for new business owners.
Open a business bank account
Once you have your formation documents and EIN, you can open a business bank account at almost any financial institution. This is an important step, which should be handled as soon as possible. You want to use your new business account exclusively for all business-related transactions, and use your existing personal accounts solely for personal transactions.
This clear separation makes business bookkeeping much simpler. It also protects your personal assets from lawsuits relating to the business.
Most financial institutions offer business checking accounts, but their requirements may vary. Call around to see which account suits your needs and business. You may wish to also apply for a business credit card and/or line of credit at this time.
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