There are so many things to do when starting a business in Nebraska – from coming up with the idea to cutting the ribbon on opening day. If you’re looking to get started by forming a Limited Liability Company (LLC) in Nebraska, and not sure what the next step is, this guide will provide you with all the information you need to make the process as easy as possible.
I’ll walk you through everything from what an LLC is and how it works to the steps involved in setting one up and maintaining compliance. So whether you’re just getting started or you’re already well on your way, this guide will help you take your business to the next level. Let’s get started!
Related: How to start a business in Nebraska
What is an LLC?
The Limited Liability Company (LLC) is a popular entity structure for businesses in Nebraska. The LLC provides personal liability protection and has the potential to save money on taxes. With our step-by-step guide, you can learn how to form an LLC in Nebraska yourself.
Unlike a sole proprietorship or partnership, where the small business owner can be held personally liable for lawsuits against the business, the LLC is a separate legal entity that protects the business owner’s personal assets. So, if the LLC is sued, the owner’s personal assets are usually protected.
Besides the liability protection, the Limited Liability Company provides several other benefits over the sole proprietorship, partnership, and corporation because of the multiple tax options, ease of administration, and management flexibility.
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What are the steps to Form a Nebraska LLC?
While it can be intimidating to form an LLC for the first time, with a little research and patience, you can learn how to form an LLC in Nebraska without an attorney.
Here are the steps to complete the Nebraska LLC formation process.
Step 1: Choose an LLC Name
The first step in forming a Nebraska Limited Liability Company is to make sure the name you want is available.
It’s critical to do a name search before registering a Limited Liability Company name, as the name of each LLC must be distinguishable from other entity names registered in the State of Nebraska. The Nebraska Secretary of State makes it easy to search and verify if your LLC name is available. Here is more information on how to do a Nebraska LLC name search.
In addition to the name being unique, the entity designator (identifier used at the end of the business name) must be either:
– Limited Liability Company
– Limited Company
A comma may be used after the business name and before the designator. “Cowboy Cleaners LLC” and “Cowboy Cleaners, LLC” are both acceptable.
If there is a name you want but are not ready to register the LLC, you can file a Name Reservation Application with the Secretary of State. The name reservation will hold a name for up to 120 days.
Before finalizing a name, you may also want to see if a domain name (also referred to as a URL) is also available to have a matching website address.
Step 2: Appoint a Nebraska Registered Agent
Every LLC in Nebraska is required to have a Registered Agent. A Registered Agent will act as a central point of contact to receive legal documents, tax notices, summons, subpoenas, etc., on behalf of the LLC.
The basic requirements to be a Registered Agent in Nebraska include:
– The agent must be a Nebraska resident at least 18 years of age or a commercial Registered Agent service with a registered office in the state.
– The agent must have a physical address in the state (A PO Box isn’t allowed).
– The agent must generally be available during normal business hours at the address provided to receive service of process.
Learn more about the requirements for a Registered Agent in Nebraska
Any individual meeting the requirements can be the agent; however, the agent’s name and address become public record, and with that comes a loss of privacy. This is more important for some entrepreneurs, especially when doing business from home or still employed. Hiring a commercial Registered Agent service like Northwest Registered Agent will help keep the owner’s names from being publicly listed.
Step 3: File the Nebraska LLC Certificate of Organization
The paperwork to officially create an LLC in Nebraska is called the Certificate of Organization.
Unlike most states, the State of Nebraska does not provide a document to form the LLC. To file the LLC with the Secretary of State, you will need to create a Certificate of Organization. The State provides statutory requirements of what needs to be in the Certificate of Organization in state statutes Nebraska Revised Statute 21-117. This form can be uploaded to the Nebraska Secretary of State’s website or mailed.
Step 4: Complete the Nebraska LLC Publication Requirement
Nebraska requires LLCs to publish a Notice of Organization for three consecutive weeks in a newspaper of general circulation in the county where an LLC’s principal office is located. What does my Notice of Organization need to include? The Notice of Organization must include the LLC’s name, the street address of the designated office, and the nature of the LLC’s business.
After the notice runs, the newspaper will send an affidavit of publication (proof the notice ran) that will be filed with the Secretary of State.
What To Do After Forming a Nebraska LLC?
Once the LLC has been formed, there are a few additional steps to take care of. Below is a list of the most common tasks.
Prepare a Nebraska LLC Operating Agreement
The operating agreement is a document that governs the framework of an LLC. This document covers items like ownership rights, LLC member responsibilities, how profits and losses are distributed, and more.
Most states do not require an LLC to have an operating agreement, but it is still worth considering. Without an operating agreement:
- The LLC could be subject to generic state rules that may be detrimental in the event of a lawsuit.
- Member’s personal liability protection may be diminished.
- Members may not fully understand their roles and responsibilities, which could lead to costly disputes in the future.
Obtain an EIN
If the LLC will hire employees or is owned by more than one member, an EIN is required.
The EIN or Employer Identification Number (also referred to as a Federal Employer Identification Number, FEIN, or Federal Tax ID Number) is a unique 9-digit tax identification number assigned to a business by the Internal Revenue Service (IRS). Similar to a social security number for an individual, the EIN identifies business entities for tax purposes. The EIN will be needed to hire employees, open a bank account, build business credit, register for business licenses and permits, file federal and state taxes, and more.
There is no cost for the EIN when registering through the IRS. The number is available immediately when applying through the IRS website; however, you can also register by phone, fax, or mailing IRS Form SS-4.
If an Employer Identification Number isn’t required, the LLC can use either the owner’s social security number or register for an EIN.
Related: How to Apply for an EIN
Open an LLC Bank Account
Opening a bank account for your LLC is important for liability protection as the account separates the business’s funds from the member’s personal funds.
Several documents will be needed to open a business bank account, such as:
- A banking resolution is a document that authorizes the members to open a business bank account on behalf of the LLC.
- Copies of the original LLC formation paperwork from the state showing the creation of the LLC.
- Driver’s licenses of the members.
- In some circumstances, a Nebraska Certificate of Good Standing may be needed to prove the LLC is active and in good standing with the state.
Apply for Business Licenses and Permits
Depending on what your business does and where it is located, there will likely be various business licenses and permits needed before starting your business. Some common registrations include:
- Business License – Some cities require businesses to obtain licensing before they can start.
- Professional License – Certain services such as barbershops, accountants, salons, and others must be licensed.
- Sales Tax License – To sell products and certain services, registration with the Nebraska Department of Revenue will be necessary.
File the Nebraska LLC Biennial Report
LLCs are required to file an annual report with the Nebraska Secretary of State. The state’s fee for filing the annual report is $13 and is due between January 1st and April 1st of each odd-numbered year.
Nebraska LLC FAQs
How much does it cost to start an LLC in Nebraska?
The state filing fee to start an LLC in Nebraska is $100 for online filings and $110 for mailed-in forms.
How long does it take for an LLC to be approved in Nebraska?
It normally takes 2-3 business days (online filing) or 7-10 business days (mailed-in filing) for the Nebraska Secretary of State to process the Certificate of Organization.
How much does it cost to file a biennial report in Nebraska?
To keep an LLC active in Nebraska, every other year, a Biennial Report along with a $13 fee will be paid to the Secretary of State.
Do you need a registered agent for your Nebraska LLC?
Nebraska law requires every LLC in the state to appoint and maintain a registered agent.
Anyone can act as a Registered Agent, provided they are at least 18 years old, reside in the state of Nebraska, and are generally available to receive documents during normal business hours.
Does an LLC need a business license in Nebraska?
It’s sometimes thought that the LLC and business license are the same in Nebraska, but they aren’t. An LLC is referred to as a business entity, which is how the business is organized to conduct business. A business license is approval from a government entity to operate legally.
Most businesses in Nebraska will need to register with a variety of government agencies. Nebraska business license requirements are based on what the business does or where it is located in the state, not on the type of entity.
What is a Foreign Limited Liability Company?
A Nebraska foreign LLC is an LLC that was formed in another state but wants to operate in Nebraska physically. Physically operating means having a presence, such as having an office or hiring an employee.
Related: What is a foreign LLC?
What is a Professional Limited Liability Company?
Businesses that require occupational licensing in Nebraska, such as accountants, architects, veterinarians, etc., will want to file for a Professional Limited Liability Company (PLLC) instead of an LLC. Filing for a Professional LLC is very similar to that of an LLC.
Is an LLC the same as a corporation?
What is a series LLC in Nebraska, and why might you need one?
A traditional LLC is the most common form of LLC, however, some states allow for the creation of s Series LLC. A series LLC is comprised of a parent LLC with one or more individual series within the umbrella of the LLC. The individual series are protected from liabilities and losses suffered by the other individual series and the holding company.
Read more: What is a Series LLC?