Are you about starting a business in Nebraska and want to form an LLC? If YES, here is the legal requirement to start an LLC in Nebraska and how much it cost.
LLC (Limited Liability Company) is one of the many structures a business can take. However, it is one of the few that has the advantage of protecting your personal assets in the event of a law suit.
LLCs can be owned by one or more persons who are known as “members”. LLCs that are owned only by one individual are known as a single-member LLCs, whereas those that are owned by more than one individual are referred to as multi-member LLCs.
In addition to protecting your personal liability, going for the LLC model can also significantly cut down on paperwork compared to corporations and other legal entity types, it can prevent your company from being taxed twice, and give more credibility to your business.
Types of LLCs
All the various types of LLC have the characteristic advantage of pass-through taxation and limited liability. However, there are still variation of the LLC business model that may be best suited for different scenarios and individuals. Here are some of the well-known types of LLCs:
- Domestic LLC: this is an LLC that intends to conduct business in the location where it was registered. Usually, when the term LLC is used, it is actually referring to a Domestic LLC.
- Foreign LLC: if an already existing LLC would like to have a subsidiary in another state, they will need to register in that state as a foreign LLC. For example, if an LLC “organized” in Wyoming opens a business establishment in Nebraska, then the Wyoming LLC will need to also form in Nebraska as a Foreign LLC.
- Professional LLC: this is for businesses that are formed with the intention of providing a professional service, such as medical or legal practice. In order to form a Professional LLC, a member of the LLC must have the necessary state licenses to demonstrate their professional qualifications.
It should however be noted that the limitation of liability does not extend to professional malpractice claims. As such, it is best to consult your lawyer before you go for this type of LLC.
- Series LLC: A Series LLC is a unique type of LLC where a single “parent” LLC provides limited liability protection across a series of “child” businesses. Also, each “child” business is protected from the liabilities of the other businesses under the single Series LLC. This type of LLC is not available in the state of Nebraska.
If you would like to form an LLC in the state of Nebraska, this is how you can go about it.
A Detailed Guide to Starting an LLC in Nebraska and the Cost
1. Choose a name: the very first step towards forming your LLC in Nebraska is to choose a company name. There are certain guidelines that ought to be followed when choosing a name and here are some of them.
- Your name must include the phrase “limited liability company” in full or in its abbreviated form (LLC or L.L.C.).
- Your name cannot include words that could confuse your LLC with a government agency (FBI, Treasury, State Department, et al.).
- There are certain words that are restricted such as Bank, Attorney, University et al. and as such, if you would want to use any of them, you will be required to have additional paperwork and a licensed individual, such as a doctor or lawyer, to be part of your LLC.
- The name you choose must be available and must not have been used by another business in Nebraska.
2. Choose A Registered Agent in Nebraska: next, you will have to nominate a registered agent in most states. A registered agent is a person or business entity who is responsible for receiving legal documents on behalf of your business. They act as a middleman between your business and the state. Whoever you choose as your registered agent must be resident in the state of Nebraska or be a corporation authorized to transact business in Nebraska. It is still possible to elect an individual within the company including yourself.
3. File The Nebraska Certificate Of Organization: next, you will need to file your Certificate of Organization in order to register your LLC. You can do this online after you created your Certificate of Organization.
Unlike what is obtainable in most states, Nebraska will not provide you with a form to create a standard Certificate of Organization. Instead, you must create and file a Certificate of Organization that includes the following information per Nebraska’s Revised Statute 21-117:
- Your LLC Name
- The street address of your Designated Address
- The name of your registered agent
- Your LLC’s effective date
- The word “Organizer” and the Organizer’s signature
4. Complete Publication Requirements: you will be required by the state of Nebraska to publish a Notice of Organization for 3 consecutive weeks in a newspaper that is circulated throughout the county in which an LLC’s principal office is located.
Your Notice of Organization must include the name of the LLC, the street address of the designated office, and the nature of the LLC’s business. After you have published your Notice of Organization for three consecutive weeks, you will receive an affidavit of publication from the newspaper that you can file with the Secretary of State
5. Create an Operating Agreement: an operating agreement is not a necessity for forming an LLC in the state of Nebraska, however, it is always advisable to have one. An operating agreement is a legal document that outlines how an LLC is owned and the operating procedure by which the said LLC will abide by. A thorough operating agreement can go a long way to prevent issues from arising amongst the owners of the LLC in future.
6. Get an EIN: The Employer Identification Number (EIN), also known as Federal Tax Identification Number, is a number that is used to identify a business entity. You can see it as the equivalent of the social security number for the company. You will need an EIN if you intend to do the following:
- To open a business bank account for the company
- For Federal and State tax purposes
- To hire employees for the company
You can get an EIN from the IRS free of charge after forming the company. This can be done online or by mail.