When you initially consider launching your own company, you’ll soon realize that the process involves a lot of decisions. The first step is choosing the type of business you want to launch, followed by the location.
Presumably, you’ve determined that Nebraska is the right state for you because you’re here! After determining those two points, you should research how to form an LLC in Nebraska.
Starting an LLC in Nebraska will include the following steps:
- #1: Name Your Nebraska LLC
- #2: Nominate a Nebraska LLC Registered Agent
- #3: File Your Nebraska LLC Certificate of Organization
- #4: Publish Your Notice of Organization
- #5: Create an Operating Agreement
- #6: Keep Your LLC in Good Standing
Steps to Start an LLC in Nebraska
1. Name Your Nebraska LLC
The first point of contact that potential clients and partners will have with your business is the name you choose for it. The choice you choose should be unique and convey the spirit of your company. The state’s regulations for name should be kept in mind when you brainstorm. Name of yourself:
- It must include the words “limited liability company” or “limited company,” or the acronyms “LLC,” “L.L.C.”, “L.C.”, or “LC.” Limited may be shortened to “Ltd.” and company to “Co.”
- It cannot use terms or acronyms like “NSA” or “Department of Education” that might lead people to mistake it for a government agency.
- Unauthorized use of terms that imply specific licensing, such as “university” or “banking,” is prohibited.
As soon as you believe you’ve selected a name that fits for your business, you should check Nebraska LLC availability. Any other organization currently operating in the state must not be associated with your name in any way.
If your name isn’t accessible when you do your Nebraska LLC search, don’t panic. There are methods to make it stand out from other names on record without diluting the essence of your name, such as:
- Replace a key phrase with a synonym (e.g., “Corn-elicious LLC” becomes “Kernel-icious LLC”).
- Rearrange your keywords such that “Corn Popped Fresh LLC” instead of “Freshly Popped Corn LLC”
Nebraska LLC name reserve might be a wonderful option for you if you’ve already decided on the ideal name and don’t want to lose it. This application will allow you to keep using that name for 120 days for a charge of $30.
2. Nominate a Nebraska LLC Registered Agent
Selecting a registered agent is among the most crucial choices the business will have to make. The agent is in charge of serving as the Nebraska LLC’s point of contact for state communications and taking receipt of legal papers.
Who Can Be a Registered Agent?
Your agent may be any person or organization that is permitted to do business in Nebraska and has a Nebraska address. While many businesses choose to have a manager or member serve as the agent, there are plenty of other excellent options.
Putting the LLC’s lawyer forward for the assignment may expedite the counseling procedure and provide the business with legal counsel fast. Using a registered agent service that focuses on serving as the LLC’s point of contact is another well-liked option.
3. File Your Nebraska LLC Certificate of Organization
Filing your certificate of organization is the act that makes the formation of your LLC official. This document is the official application to the state requesting that your company be cleared to conduct business. It provides all the information needed to get in contact with your LLC, including:
- Name of your Nebraska LLC
- Physical address and mailing address for your LLC’s office
- Name and address of your registered agent
- Printed name and signature of the LLC’s organizer
Your LLC will be effective as soon as you submit the organization document and it’s processed. If for some reason you want it to become effective later, you can list that date on the document.
When it comes to forming an LLC, Nebraska will assess different fees based on whether you file in-office ($110) or use the online portal ($100).
What if My Nebraska LLC Wants to Offer Professional Services?
If your LLC is being formed to provide services that require a license (e.g., realtor, practice of medicine or law) you’ll need to comply with the requirements for a professional LLC.
Most importantly, you’ll need to submit a Nebraska LLC registration certificate to prove that all members of the company are licensed in the same profession.
4. Publish Your Notice of Organization
The certificate of organization notifies the state that you’re forming an LLC, and the publication is to notify the public that you’ve formed an LLC. To be accepted, your publication must appear in a “legal” newspaper as an ad for at least three weeks.
The paper must have general circulation in the county where you’ll conduct business and have at least 300 subscribers.
The information posted in the publication provides all contact information should a member of the public need to reach the LLC, including:
- The name of your Nebraska LLC
- The name and address of your registered agent
- The address of your LLC’s office
- Whether your company is offering a professional service
After running for three consecutive weeks, the paper will give you proof of publication which you’ll file with the state online or by mail. To confirm the state received it, you can check your LLC’s permanent record by performing a business search.
5. Create an Operating Agreement
While an operating agreement is not required to form a Nebraska LLC, putting one in place will help keep your company stable and operating smoothly.
An operating agreement is an outline of the company’s business activities and is a written record of member decisions and relationships within the LLC.
Some common provisions to include in an operating agreement include:
- Ownership division
- Profit and loss allocation
- Accounting and financing details
- Voting protocol
- New member initiation
- Transfer of shares
Without an agreement in place, your LLC will be governed by default LLC laws in Nebraska, which might not be advantageous to your business. There are several online services that offer free templates and can generate an agreement for you.
Law in Action: Two siblings form an LLC to manage a series of rental homes left to them by their parents. The siblings agree that if something happened to one of them the remaining sibling will sell the properties and keep the profits for themself.
When one of the siblings passes, the children of that sibling assert entitlement to the profits generated from selling the properties, as is their right under default LLC laws.
Without an operating agreement in place to memorialize the agreement between the siblings, the remaining sibling must comply with state law and share profits with the deceased sibling’s children.
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6. Keep Your LLC in Good Standing
After going through the process of how to start an LLC in Nebraska, you don’t want that hard work to go to waste. You should stay on top of annual filings, pay your taxes and comply with any laws that govern your LLC.
Are There Annual Filings for Nebraska LLCs?
All LLCs are required to file a report once every two years on April 1, starting in the next odd year after your LLC is formed. For example, an LLC that’s formed in the year 2022 will file its first annual report by April 1 of 2023.
An LLC that’s formed in 2023 won’t file its first report until April 1 of 2025. Any report not filed by June 1 of the year it’s due will be considered delinquent and may face dissolution. The cost for filing this report is $25.
What’s an EIN and Do I Need One?
An EIN (“employer identification number”) is issued to a business by the IRS and is used primarily for tax purposes. If your LLC has more than one member, or employees, then you’re required to get one using the free and quick application process.
If you’re an LLC with only one member, you might be wondering whether you should get one even if you don’t need one. Technically you don’t, you’ll just use your personal Social Security number where an EIN is requested.
But there are benefits to having an EIN, especially if your LLC plans to conduct any of the following business activities:
- Apply for a business loan
- Open a business banking account
- Make contracts with vendors
- Hire employees
What Are LLC Tax Filing Requirements?
LLCs that have not elected to be taxed as corporations are considered “pass-through” entities. The income made by the LLC will be passed through for the members to claim on their individual tax returns.
If your LLC has employees, engages in retail sales, rents or leases tangible personal property or provides taxable services, then you’ll need to register your business with the department of revenue.
This account will allow your LLC to collect taxes on your sales or services and pay employer taxes.
Where Can I Find Local Help?
Below are some great local resources that can assist your LLC with funding, provide counseling services or help facilitate partnerships:
- Small Business Administration (Nebraska Office)
- Nebraska Department of Economic Development
- Nebraska Small Business Loans
The Cost of Forming an LLC in Nebraska
Nebraska stands out as an appealing state for LLC formation due to its affordable initial LLC costs. The filing fee for LLCs in Nebraska is a mere $105, making it one of the more budget-friendly states for entrepreneurs and small business owners.
Nebraska also mandates the submission of an annual report for LLCs, accompanied by a fee that varies based on the LLC’s income, typically ranging from $10 to $125. This annual commitment adds an ongoing financial obligation to your business operations.
Pros and Cons of Forming an LLC in Nebraska
Pros
- Nebraska offers low initial filing fees for LLC formation, making it cost-effective for entrepreneurs and small businesses
- The state does not impose a franchise tax on LLCs
- Forming an LLC in Nebraska provides limited liability protection
Cons
- LLCs in Nebraska must file an annual report and pay an associated fee
- Nebraska’s relatively small population may limit the market size and growth potential for certain businesses
What’s the Difference Between a Nebraska LLC and Other Business Entities?
Before diving into the steps, you should make sure a Nebraska LLC is the best structure for your business. There are two main types of business associations: Informal and formal. Each has its advantages and disadvantages, mostly determined by the type of business you’re looking to conduct.
Informal Associations
The main characteristic of an informal association is that you don’t need to file any paperwork with the Nebraska secretary of state to conduct business. The main types of informal business entities are sole proprietorships and general partnerships.
Sole Proprietorship: One person conducts business for profit and they take all the liability and claim all of the profit as personal income. This is more suitable for those running a small and low-risk business.
General Partnership: Two or more people are co-owners of a for-profit business and they share liability and profits. Profits are considered income for each partner and they’re taxed on that income each year. Partnerships are inexpensive to maintain and are ideal for small, new operations that aren’t ready to commit to organizing under the state.
Formal Associations
You need to submit the necessary paperwork with the state in order to conduct official association business in the state. The two most common business forms of this kind are limited liability firms and corporations.
company: Under the ownership of its stockholders, the company bears all obligation and debts, not any specific individuals. Under this arrangement, income is “double-taxed” (once at the corporate level and once when given to shareholders or workers).For those who want to transfer stock ownership simply and operate on a national scale, this is the best option.
Limited Liability Company (LLC): An LLC combines the advantages of single taxation of an informal organization with the limited liability of a corporation. The members, who are not shareholders, are only subject to a single annual tax on the earnings they receive as income; the corporation bears all obligation. An LLC may consist of one member (like a sole proprietorship) or many members (like a general partnership).
An LLC is often the preferred formation for small enterprises that want to preserve personal assets while maintaining the tax advantages of an informal group due to its flexibility and limited liability.
After determining that an LLC is the ideal organizational form for your business, let’s examine the fundamentals of creating an LLC in Nebraska and other states.
The Bottom Line: Forming an LLC in Nebraska
In Nebraska, creating an LLC is a very simple procedure that only requires a few steps to finish. To make paperwork easier, the state offers a wealth of materials, including template forms and step-by-step instructions. Examining top LLC formation services may also help to expedite the procedure.
Frequently Asked Questions: Nebraska LLC Formation
What if I already have an LLC in a different state?
If you already have an LLC in a different state and want to operate in Nebraska, you’ll typically need to register as a foreign LLC in Nebraska. This process involves filing the necessary forms and paying the required fees to gain legal recognition to conduct business in the state.
Can I create a series LLC in Nebraska?
Nebraska does not officially recognize series LLCs. It’s advisable to consult with legal counsel or the Nebraska Secretary of State for the most current information.
Can I file my LLC documents online?
Yes, you can file your LLC documents online in Nebraska through the Nebraska Secretary of State’s website.
How long does it take to create an LLC and can it be expedited?
The timeline to create an LLC in Nebraska can vary, but it generally takes several weeks. Expedited processing is available for an additional fee, which can significantly reduce the processing time, typically to a matter of days. The exact timeframes and fees for expedited processing may change, so it’s essential to check with the Nebraska Secretary of State for the most up-to-date information.
