You have a lot of choices if you want to start your own company. For a start-up or a small-medium-sized company, an LLC is the best choice. The cherry on top is that you want your company to be located in Oklahoma. This state is business-friendly and offers a variety of benefits to businesses. One of the advantages is that the State of Oklahoma provides the Small Employer Quality Jobs Program, which provides incentives for companies with less than 500 employees.
A limited liability company is a form of a business structure formed to manage and own a business. It is one of the most flexible business structures. They have limited liability protection, easier to handle, formation cost is low, which is why they are so common. The LLC has a sustainable structure; it can be built indefinitely or shut down after some time. The best part is that members have complete control over the operation of the company. LLC comes with several advantages; let us take a look at some of them:
- Protection of personal liability
The LLC’s representatives are not responsible for the company’s debts or actions. All of your personal property, like your home, vehicle, and other valuables, are protected once your LLC is established.
- Easy to form
Not a lot of paperwork is needed to establish an LLC. With the filing of the Articles of organization, your company will be authorized. That’s it. You don’t have to file loads of loads of paperwork.
- Tax flexibility
The tax structure is flexible in LLC. The members pay the gains and losses of the company in their income tax returns. They don’t have to file a separate tax.
- Unlimited members
There are no restrictions on the number of owners. The owner can be one or many; you can have single-member LLC or multi-members LLC.
- Flexibility in management
The members have the right to choose whether they want a member-managed LLC or manager-managed LLC. In the member-managed, the members decide, whereas, in the manager-managed, it is the manager’s work.
Now, we have seen what an LLC is, how it is beneficial. It is time to look at all the steps required to form one. Follow the article till the art to get the complete details.
Step 1: Give your LLC a name
There is a vast significance of a name in the business field. Really. Your Oklahoma LLC’s credibility, personality, identity are all described by its name. You’ve hit gold if you can come up with a name for your company that will stay in people’s minds. The title should also convey the company’s brand and what you deal with. A distinctive, recognizable name will attract new customers while also encouraging current ones to return. The business cards, blogs, website, bank statements, invoices, and more will feature your LLC name. As a result, make sure it accurately represents your business; you should be imaginative with your company name, it must adhere to the state specifications.
Ensure that you have followed the naming rules when you select your company’s name. If you have several choices, refine them to shape your ideal LLC name. The terms Limited Liability Company or its abbreviations must appear in your LLC’s name. It must also be distinct from any name that has been already present in the State records. If your preferred name is now in use, you might be wondering how to differentiate yourself. For that, mere changes in the occurrence of words, adding capital letters, punctuations, etc., are not enough. You have to make some significant changes in the keywords. You have to make sure the name you want is available. Of course, if the name you selected is not available or is in use, you would need to create distinctive adjustments. You can check the Business Entities search provided by the secretary of state to check the availability of the name. Following the research, you choose a name, which you can then secure by applying for a name reservation. Once you’ve decided on a name, you’ve put your soul into it and finalized it; but, there are some subsequent steps you can take. Before you start your LLC, you might have to finish some office work or paperwork. If you’re concerned that someone else could use the same name as your LLC, don’t be. You can hold the name for 60 days. You can do so online, or you can send the hard copy. For the online method, you have to visit the entity filing page and submit the application. You can also mail the application or deliver it in person to the following address:
Oklahoma Secretary of State
421 N.W. 13th, Suite 210
Oklahoma City, OK 73103.
The online method is the quickest as your application will take 1 to 2 working days to get processed. The hard-copy form will take around 7 to 10 days. There is also an option to accelerate the process; you have to pay an additional $25 if you want the same-day service.
Step 2: Assign a Registered Agent
In your LLC, you’ll need someone to handle all of your legal and relevant correspondence. This person is known as a registered agent, and having one is required by law. This agent is critical to the operation of an LLC because it manages to contact and delivers it to you. As a result, no vital records, notes, or other information is overlooked. The Secretary of State sends essential papers, legal notices, and emails to the LLC’s registered agent, who ensures they deliver it to the LLC’s owners. As a result, the state has made it obligatory for businesses to have one. The licensed agent serves as a liaison between the state and the limited liability company. It is illegal to work without a licensed agent.
Who is qualified to serve as the registered agent?
A registered agent may be a person or a business. It could be one of your colleagues, family members or even you. According to the rules, the person must be a resident of Oklahoma and be 18 years old or older. The same can be said for a business. The company must have an address in Oklahoma and be licensed to do business in the state. You may even act as your agent, but this will add to your workload. You are not permitted to leave the office during working hours as the registered agent. You can also employ a licensed agent service if you like. They will assist you in the creation of the LLC and provide you with an agent. Also, there will come a time when your current registered agent leaves or needs to change the agent while operating a business. As a result, the transfer should be seamless and fast, as your company should not work without a registered agent, as this may result in the dissolution of your LLC.
Step 3: Submit the Articles of Organization with the State
The article of the organization is the first step in establishing your LLC as a legitimate business. Your LLC will not be recognized without this document, and you will be unable to open your company. So, this paper is critical because it essentially kick-starts your business.
- The name of your company
- the name of the registered agent
- the address of both the LLC and the agent
- the intent of your business
- the signatures of all members
Apart from the things mentioned above, there are many more details included in the Article of Organization.
You must also state whether your management structure is run by members or by managers. The state will have a record of your business after you submit this paper. You’ll be able to open your doors until the state approves it. The following methods are available for submitting the Articles of Organization:
Choose online submission if you want the process to be fast. You must complete the form online. Fill out the form on the official website’s Entities filing tab. Your application will be processed within one to two working days. You’ll also have to pay a $100 bill.
Submission by mail
The postal mail is the next choice for submitting your application. Your application will get processed in approximately 7 to 10 days; you must mail the application, along with the $100 application fee, to the below-mentioned address.
Oklahoma Secretary of State
421 N.W. 13th Street Suite 210
Oklahoma City, OK 73103
You may also visit the office and send the application along with a $100 bill. You can also speed up the process by $25, cutting it down to a few hours.
Step 4: The Operating Agreement
This agreement is one of the essential documents to draft. While having an operating agreement is not required in Oklahoma, this does not negate its importance. This agreement contains the company’s operating rules, policies, and regulations. So, for your LLC to run smoothly, you can have an operating agreement. The agreement was signed by all of the participants, indicating that they all agreed to the terms. As a result, this agreement constitutes the company’s rules. If there is a dispute among the participants, the operating agreement will serve as evidence.
There are a few questions you can include in the agreement:
- How much of each member’s share is theirs? The percentage would determine how earnings and wages are distributed.
- Each member’s rights and obligations
- The process for leaving or joining a limited liability company (LLC)
- What would the dissolution terms be?
If you’re a single-member LLC or a sole-proprietorship, you’ll still need an operating agreement. It will include the laws and evidence that your company is distinct from your organization in the eyes of the law. You can write your company’s operating agreement. You may also hire a specialist, such as a lawyer, to assist you. Each option is valid.
Step 5: Acquire an EIN
The EIN (Employer Identification Number) is a number you must obtain from the Internal Revenue Service (IRS). The IRS uses this number to track your income, company expenses, and other financial transactions. If you want to recruit staff, open a bank account, or get a loan, you’ll need an EIN. In the absence of an EIN, you could use your Social Security number for all business purposes (SSN). This concept may not be the best. Using your Social Security number for business purposes could jeopardize your privacy. If you are a sole proprietorship with no plans to hire workers, an EIN is also needed for the above purposes. You can obtain an EIN in one of the following ways:
You can apply between the hours of 7 am and 10 pm Monday to Friday. This is the quickest form. The answer is prompt. Within a few seconds of pressing the submit button, you will receive the employer identification number.
Your EIN will be sent to you via fax in four working days. You must print the Form SS-4 that you have downloaded from the internet. It is necessary to fax the form once it has been completed. You must fax it to (855) 641-6935 at this number.
Via the postal service
Your application will be processed in four weeks using this form. You must print and full Form SS-4 after downloading it. After that, send the form to the address mentioned below:
Internal Revenue Service Operation
Attn: EIN Operation
Cincinnati, OH 45999
Step 6: Federal, State, and Local Taxes, Permits, and Licenses
Take a look at the key things to remember once your LLC is up and running. One benefit of an LLC is that it has a flexible tax structure. It is also easy to file the tax without difficulty.
Income taxes levied by the federal government
As previously mentioned, the LLC has a flexible tax structure. As a result, you can choose whether to pay taxes as a C company or as an LLC. If you want to file your taxes as a corporation, you would be required to pay a tax specifically for the corporation. You may not have to pay taxes to your federal government right away if you form an LLC. The owners declare their business’s profits and damages on their tax returns.
Local and state taxes
The state income taxes are somewhat similar to the federal income taxes. Owners pay taxes on their income tax returns as well. Besides, there is no privilege tax or franchise tax in Oklahoma. Many local governments, towns, and counties have their collection of tax laws. As a result, get in touch with them for more details.
Additional fees and taxes
Some taxes are unique to businesses. For example, the tobacco industry is subject to taxes, and other industries are subject to additional surcharges. When you have employees, for instance, you must pay an unemployment insurance fee. You must register with the Job Protection Commission to do so. If your company sells products, you are required to pay sales/use tax. You may register with the Oklahoma Tax Commission and obtain all necessary details.
Permits and licenses for businesses
It’s one thing to pay your taxes and another to get your business license. The license and permit requirements differ depending on the nature of the company. A suitable service license, a health license, and a liquor license may be required for a restaurant. Similarly, various industries have different permit requirements. Working without a valid claim is against the law. Visit the commerce department’s page on business licenses and operating conditions for more detail.
Step 7: Annual Reporting
This move is taken after your LLC has been established and operations have begun. Following the creation of your LLC, you must send a comprehensive annual certificate to the Secretary of State each year. This credential would include all of your LLC’s main features and functions. You must also state whether your business has undergone any significant changes, such as a change of address or registered agent. You may send your report in three ways: online, by postal mail, or by hand. You must pay $25 regardless of the form you select. You must submit your paper to the following address:
Oklahoma Secretary of State
421 N.W. 13th Street Suite 210
Oklahoma City, OK 73103
The online process is the quickest; your report will be processed in 1 to 2 days. It will take 7 to 10 days for the certificate to be processed via mail. And 5 to 7 days for the certificate to be processed via hand delivery.
There is also the choice of expediting the hand-delivery submission process. For same-day delivery, you must pay an extra $25. Remember to submit the annual certificate on time to keep your good standing with the state. If you do not send the report within sixty days around the deadline, it will impact your reputation with the Secretary of State. Additionally, if you have not filed the report for three years, your LLC will be dissolved.
Steps to take after forming the LLC
After forming the LLC, the work doesn’t stop. After your LLC is up and running, you’ll need to take a few moves.
Get a Certificate of Good Standing
After being created, your LLC can start doing business. If you have a certificate of good standing, it will add to the benefits. It’s a formal declaration that the LLC complies with all state laws and regulations. This certificate helps you prove that you have an excellent status with the government and follows all the rules. It also helps in establishing a new business relationship or getting vendors.
Open a bank account
You have all the documents to open your business account. There are several benefits of having a separate bank account. The first and most significant benefit is that it keeps the company and personal expenses apart. The second benefit is that you will easily monitor and report all of your business expenses. It would be easier to prove what belongs to you and what belongs to your company if your properties are split.
Get a credit card for your business.
A business-only credit card will help you separate personal and business expenses. Another advantage is that it improves the company’s credit score, which can help you to get loans. You can easily manage your business expenses and purchases. So, get the credit card as soon as you can.
For your company, you should hire an accountant.
A company accountant keeps you from overpaying taxes and avoids fines, fees, and other penalties. The accountant will take care of all your taxes and make sure that you have paid them in time.
Insurance is an essential technique because it helps you focus on growing your business rather than worrying about risks. Any damages that arise will not be your responsibility if you are insured. When you know you’re covered in the event of a disaster, you’ll be able to function without stress.
Make a website
If you want your business to grow, you do need a good marketing strategy. Marketing will allow you to attract new customers. Customers make any business a success. So, you have to find a way to get to them. Make an attractive website, so if any client wants to check out your business, they will reach out to your site, and there they will get all the necessary information.
We’ve finally made it to the end of the post. It may appear to be a long and tedious operation, but it is ultimately worthwhile. You’ve planted the seeds; now it’s time to reap the rewards. The result eliminates any tiredness. You’ve made it to the end. You’ve waited patiently and are now ready to launch your business.