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2022 Guide to Starting an LLC in Nebraska

Nebraska LLC Quick Facts

Nebraska LLC Costs

Initial Cost – State LLC Filing Fee:
– Filing Online: $100
– Filing by Mail: $110

 

Recurring Cost:
– Biennial Report Filing Fee: $10

Nebraska LLC Processing Time

– Filing Online: 2-3 business days
– Filing by Mail: 7-10 business days

Not sure about filing an LLC yourself?

Want an LLC, but not sure about filing the paperwork yourself? Let Zenbusiness, IncFile, or IncAuthority help guide you through the LLC formation process, so you know everything was done right.

IncFile and IncAuthority are both currently running a special where you only pay state fees for your LLC formation!

Overview

Guide to Starting an LLC in Nebraska

Starting a business can be a daunting task. There are so many things to think about – from the initial planning stages to day-to-day operations. If you’re looking to start an LLC in Nebraska, this guide will provide you with all the information you need to make the process as easy as possible. We’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!

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 structure, protecting the business owner’s personal assets.

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.

Related: Guide to starting a business in Nebraska

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.

Let’s break down the steps to complete the Nebraska LLC formation process.

Total Time: 10 minutes

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 an LLC 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
– L.L.C.
– LLC
– L.C.
– LC

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 at the cost of $15.

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.

Consider using an LLC formation service like Zenbusiness, IncAuthority, Northwest, or IncFile to guide you through the LLC formation process, so you know everything was done right.

IncAuthority and IncFile are currently running a special where you only pay state fees for your LLC formation and they do the rest!

What do you have 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.

Notice of LLC Organization Publication

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.

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.

Related: Nebraska operating agreement template

Obtain an EIN

The EIN or Employer Identification Number (also called a Federal Employer Identification Number, FEIN, or Federal Tax Identification Number) is a unique nine-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.

Related: How to Apply for an EIN

Elect the LLC’s Form of Federal Income Taxation

One of the significant benefits of the Limited Liability Company is the tax flexibility it provides.  When applying for the Employer Identification Number, you will choose how the entity will be taxed for federal income tax purposes. While there are some limitations, an LLC may be classified for federal income tax purposes as a:

  • Sole proprietorship
  • Partnership
  • C-corporation
  • S-corporation

While this may sound confusing, this refers to how the LLC is taxed, not the legal structure.

Related: How can an LLC be taxed?

By default, the taxation of an LLC is called pass-through taxation, which means the profits or losses of the LLC flow through to the members.

Single-member LLCs will, by default, be taxed as a sole proprietorship. The members can also elect to change the taxation to a C-corporation or an S-corporation.

Multi-member LLCs will, by default, be taxed as a partnership. The members can also elect to change the taxation to a C-corporation or an S-corporation.

In general, the difference between being taxed as a corporation and being taxed as a sole proprietorship or partnership the profits and losses are passed to the member’s federal income tax returns based on their percentage of ownership.  As a result, the owner will pay self-employment taxes on all business profits.  As an alternative, electing to be taxed as a corporation allows the members to take a reasonable salary and then pay payroll taxes.  Any remaining profits are distributed and aren’t subject to payroll taxes, resulting in potential tax savings.

Before electing how your LLC will be taxed, consider talking with an accountant to assess which one will be best for you. Some tax elections, such as the C corporation, may be detrimental for some people due to double taxation.

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.

Related: How to Open a Business Bank Account for your LLC

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.

Related: What Business Licenses are Needed in Nebraska?

File the 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 $10 and is due between January 1st and April 1st of each odd-numbered year.

Related: How to File a Nebraska LLC Biennial Report

Common Questions To Starting An LLC In Nebraska

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.

What is the processing time to form an LLC 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 $10 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 active 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.

Related: What are the requirements of a Nebraska Registered Agent?

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 the business entity, which is how the business is organized to conduct business. A business license is an approval from a government entity to legally operate.

Related: What licenses are required for businesses in Nebraska?

What is a Foreign Limited Liability Company?

A Nebraska foreign LLC is an LLC that was formed in another state but wants to physically operate in Nebraska. 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 PLLC is very similar to that of an LLC.

Related: What is a Professional Limited Liability Company?

Is an LLC the same as a corporation?

The LLC is one of four main types of business entities. You can learn more about each here:
What is a sole proprietorship?
What is a general partnership?
How to form a Nebraska 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?

Should I use an LLC formation service or do it myself?

Following our guide, most people will be able to form an LLC on their own, however, LLC formation services like IncFile and IncAuthority will guide you through the process and guarantee it’s done right – and it doesn’t cost any extra to do so!

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