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Wondering how to start an LLC in Oklahoma? You’ve come to the right place! This step-by-step guide will take you through the LLC formation process and provide helpful information you need to keep your Oklahoma LLC viable for years to come.
Before learning how to start an LLC in Oklahoma, you might want to make sure an LLC is the right kind of business entity for your company. Here is a quick run through of the most common business associations in Oklahoma.
A single owner conducting business who takes all the liability of the business and claims all the profits as personal income is considered a sole proprietor. There’s no formal filing with the secretary of state required.
A general partnership consists of two or more people conducting business who share the liability of the business and partners share profits (and losses). There’s no formal filing with the secretary of state required.
Owned by shareholders, the corporation itself assumes all liability. Income is “double-taxed” in this structure (once at the corporate level and once when distributed to employees or shareholders). Formal filing with the secretary of state is required.
The limited liability company (LLC) entity was created to combine the tax benefits of a sole proprietorship and the liability perks of a corporation. The company takes all the liability, but the members are only taxed at the income level. Formal filing with the secretary of state is required.
An LLC is a good choice for medium- to higher-risk businesses, owners who have significant personal assets that need protection or owners who don’t want the double taxation associated with a corporation.
If you’ve decided an LLC is the best fit for your business, learn more about how to start an LLC in Oklahoma by reading through this step-by-step guide.
Choosing a name is the first and most important step in establishing your company. The name should comply with all naming requirements under Oklahoma LLC laws and should be easy to understand and identify.
Your name must include either the phrase “limited liability company” or one of its abbreviations (LLC or L.L.C.). Including this phrase helps those doing business with you understand the limitations of your company’s liability.
You can’t use words that might confuse your Oklahoma LLC with a government agency. Let’s say Frank Bonnie Inkle, wants to use his initials as the name of his company, FBI, LLC. If someone saw his company’s name, they would probably confuse his initials (“FBI”) with the Federal Bureau of Investigations — so Frank can’t use that name.
You also can’t use a name that already belongs to, or is reserved for, a company in Oklahoma. If you want to check whether the name you’ve picked out is available, you can go to the LLC Oklahoma search function on the Secretary of State’s website and search. If your desired name is already taken don’t fret — there are ways to tweak your name and make it distinguishable without completely changing it.
For example, Sally really wanted to name her company “Sally’s Hot Dogs, LLC” but that name is already taken. She could try a different variation of the name or add a word to make it distinguishable. She could use “Hot Dogs by Sally, LLC” or “Sally’s Best Hot Dogs, LLC, ” which are both available.
Inside Scoop: Along with searching the entity name database you should check to see whether your company’s name is available as a domain name. Even if you don’t need a website now, you might need one down the road. You can always purchase the domain name for when you’re ready to power your own website.
There’s a lot to consider when thinking about how to start an LLC in Oklahoma, including who will be responsible for receiving important communication addressed to your company. To do business as an LLC in Oklahoma, you must have an agent to accept service of process if your company is sued or to serve as a point of communication between the business and the state.
The agent must have a physical Oklahoma address and may be:
You can even choose yourself or a member of your LLC to be the agent. Depending on your business structure, it might make sense to appoint a third party. Some LLC’s choose to have its attorney as the agent so when the LLC is sued there is one less step to take in getting legal counsel.
Inside Scoop: There are several companies that exclusively focus on providing registered agent services to LLCs and other Oklahoma businesses. Do your research and select a service that gets high ratings and fits within your budget.
The next step when figuring out how to start an LLC in Oklahoma is filing the articles of organization for your Oklahoma limited liability company so you can officially form your company. This document must include:
If you want to electronically file the articles of organization, Oklahoma has an entity filing webpage or by mailing to the Oklahoma Secretary of State.
Mailing address:
OKLAHOMA SECRETARY OF STATE
Business Filing Department
421 N.W. 13th, Suite 210
Oklahoma City, OK 73103
Inside Scoop: Whether you decide to file online, or through the mail, the filing fee is $100. Filling out the form takes about five minutes and if you file online the processing time is only about one to two business days. If you choose to mail in a paper copy, the processing time is about three to four weeks.
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While having an operating agreement in place isn’t a requirement for forming an Oklahoma LLC, having one in place can help avoid any complications with your business. This agreement outlines the financial and functional decisions the business needs to make. It organizes duties and responsibilities of each member and sets protocol for day-to-day operations and emergencies if they should arise.
Some single member LLCs may choose not to have a formal operating agreement since only one member is responsible for conducting business. If your LLC has many members or employees, then operating without an agreement in place leaves the door open for confusion.
For example, let’s say there are only two members of an Oklahoma LLC and they verbally agree that each year they will each set half of their profits aside to reinvest in the LLC. When it comes time for them to do so a year down the road, one member denies ever making the agreement. This conflict eventually breaks up the LLC. If there was an agreement in place which recorded this verbal decision, the conflict would have never occurred.
Inside Scoop: You never know what the future holds, it may even lead to the break up of your LLC. Adding a section in your operating agreement about how your LLC can be dissolved will replace the Oklahoma default rules which may not be in your company’s best interest. For example, by default there must be unanimous consent from all members to dissolve. You may want it to be a majority vote that rules (which you can enforce if it’s in your operating agreement).
Now that you’ve figured out how to start an LLC in Oklahoma, you might be thinking about what else comes with maintaining your business. Even if your company doesn’t have employees, an employer identification number (EIN) — which you can apply for online — is required for any businesses operating in Oklahoma. Your EIN will also be needed to establish things like a line of credit or business checking account.
Choose a catchy name. It’s important for current and potential customers to easily recall your company, so the next time they need the kind of service your company offers they will reach out to you. Ways to make it memorable include alliteration or a play on words.
Check social media. After checking to ensure your preferred name is available as a domain name, go ahead and search for your potential business name on social media platforms. If you can use your company’s name as a handle on Twitter or Instagram, you will easily create a searchable presence that can help your customers find you and ultimately build your brand.
If you’re trying to figure out how to form an LLC in Oklahoma online, the state offers an online filing option that costs the same amount as it would be to file through the mail. All you’ll need to do is go to the Secretary of State’s webpage, fill in the required information and upload the articles of organization.
If you’re wondering how to start an LLC in Oklahoma, you may also have questions about taxes for an Oklahoma LLC. This depends on whether your LLC is single-member or multi-member.
In a single-member LLC, net earnings are recorded as income on the member’s personal tax return as “self-employed” income. In a multi-member organization, the LLC must file a tax return and each member must file a K-1 with their personal returns.
The single-member LLC filing procedure is the same as with multiple members. You’ll need to file the articles of organization and even though there’s only one member, an operating agreement could still be beneficial for your company.
After mastering the process of how to start an LLC in Oklahoma, you need to make sure you’re in compliance for years to come. To keep your LLC active and able to do business in Oklahoma, you’ll need to file an annual certificate each year by your anniversary date along with a $25 filing fee.
Failure to file within 60 days of the anniversary will take your Oklahoma LLC out of “good standing,” which means you can’t file any documents or maintain a proceeding in court. If you still don’t file the certificate by the third anniversary of your missed filing, your LLC will move into “canceled” status. After six years, your name will be available to use by the public.
With all the forms and fees, you might be overwhelmed when starting your own business. But there’s really no need to stress about how to start an LLC in Oklahoma when you can just use a reliable online service to do the hard work for you.
Legal Disclaimer: This article contains general legal information but does not constitute professional legal advice for your particular situation and should not be interpreted as creating an attorney-client relationship. If you have legal questions, you should seek the advice of an attorney licensed in your jurisdiction.
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