Ohio LLC: How To Start Your LLC in Ohio

Starting an Ohio LLC is straightforward and also comes with many key tax benefits compared to other states.

Starting a limited liability company (LLC) can be a wise choice for a small business or startup. You can start an LLC in any state, even if you don’t physically live there—it depends on which benefits work best for your business.

Ohio offers lower maintenance fees than states like California, which charges owners $800 annually whether the business is active and profitable or not. LLCs in Ohio don’t need to file annual reports, saving you from submitting yearly summaries to the secretary of state.

Ohio LLCs receive several tax advantages, including job creation tax credits and single-level taxation that helps you avoid corporate double taxation. While setting up an LLC in Ohio requires paperwork and filing costs, the payoff can be worth it.

What is an LLC?

A limited liability company (LLC) is a type of business entity that protects business owners from lawsuits and debtors. The company—not you personally—becomes responsible for legal and financial matters. One or more individuals can be LLC owners, also known as “members.”

A single-member LLC has one owner, while a multi-member LLC has multiple managing members. Your LLC name serves as a legal name for documents and shows your business’s management structure.

How to start an LLC in Ohio

1. Choose an idea for your LLC
2. Name your Ohio LLC
3. Create a business plan
4. Get a federal employer identification number (EIN)
5. File your Ohio articles of organization
6. Choose a registered agent in Ohio
7. Obtain business licenses and permits
8. Understand Ohio state tax requirements
9. Prepare an Ohio LLC operating agreement
10. File an Ohio BOI report
11. Examine business insurance options in Ohio
12. Market your LLC

1. Choose an idea for your LLC

First, choose a viable business idea. Whether you’re starting a side business or have bigger goals, consider what products or services you could offer. Research your competition, analyze potential demand, and review your funding to find the most feasible option.

Think about your skill set or what unique offerings you could bring to the market. Market analysis helps you measure what you have to offer against existing competition.

2. Name your Ohio LLC

When setting up your LLC, choose a name that meets Ohio’s requirements:

• Include the required suffixes: Your LLC name must contain the key phrase “Limited Liability Company” or its abbreviations “LLC,” “L.L.C.,” “Limited,” or “Ltd.” The name can’t include government entity terms like “IRS” or “CIA,” slurs, or names that are already in use. To use words like “insurance” or “doctor,” you’ll need additional paperwork and proof of professional licenses.
• Make the name unique: Use the Ohio state website’s business name search to check if your name is available. If you’re opening a bakery or sporting goods shop, try searching keywords like “muffins” or “sports” to see active businesses with those terms. While you could modify existing names, a unique name helps avoid customer confusion.
• Reserve the name: If available, file Form 534B to reserve the name for up to 180 days for $39. Consider reserving a matching domain name too—this prevents others from using your web address for unrelated purposes. Website hosts like GoDaddy offer free domain name searches.

Note that your LLC name doesn’t have to match your public business name. In Ohio, you can use a trade name (also called DBA or “doing business as”) for marketing. For example, “Howard Edgar Schwartzmann, LLC” could operate publicly as “Party Town USA.” However, if you plan on keeping your LLC and trade name the same, consider carefully when choosing your name.

3. Create a business plan

While not required for forming an LLC, a business plan helps banks and investors take you seriously. A strong plan outlines your:

• Company goals and timeline
• Business background
• Mission and agenda
• Marketing strategy
• Operations plans

4. Get a federal employer identification number (EIN)

An EIN works like a Social Security number for your business. You need this free IRS-issued number for:

• Your taxes: You’ll need a government-issued identification number to file taxes for your LLC. An EIN officially separates your business entity from your personal taxes.
• Your business bank account: To open a business bank account, you’ll need an EIN. LLCs must keep personal and business finances separate. 
• Your employees: An EIN is required to hire employees. If you plan to hire employees, you can apply for an EIN on the Internal Revenue Service website.

Apply for your EIN through the IRS website at no cost. Most applications process immediately, giving you your EIN number as soon as you finish.

5. File your Ohio articles of organization

To officially form your LLC in Ohio, file articles of organization (Form 610, formerly 533A) with the Ohio Secretary of State. Foreign LLCs need Form 533b.

You’ll need to provide:

• Your name and mailing address
• Your LLC’s name
• Your statutory agent’s details and signature (person authorized to receive official documents)
• Business purpose (optional)

The filing fee is $99 for both domestic and foreign LLCs. Standard processing takes two to seven business days. If you’re in a hurry, Ohio offers expedited service for an extra fee, with processing in one to two business days.

6. Choose a registered agent in Ohio

While you don’t need to live in Ohio to form an LLC there, you do need a registered agent (or statutory agent) to act as your point of contact with the state. Your agent must be either:

• An Ohio resident
• A corporation authorized to do business in Ohio
• You (if you meet state requirements)

Your agent must be available during business hours to handle government correspondence, tax documents, and legal paperwork. Registered agent service fees start at around $49, though some charge hundreds of dollars. Research your options carefully before selecting a representative.

7. Obtain business licenses and permits

Some businesses need specific licenses or permits to operate. For example: 

• Retailers selling tangible goods or taxable services need a vendor’s license from the Ohio Department of Taxation for sales tax collection. Animal rescue businesses may need environmental permits from the Ohio EPA.

Visit Ohio’s government website to check which licenses your business category requires.

8. Understand Ohio state tax requirements

Know your tax obligations to avoid unnecessary headaches and possible fines. Key requirements include:

State sales tax:

• Basic rate: 5.75% (may vary by county)
• Required if you have a vendor’s license

Commercial activity tax:

Applies to businesses earning more than $1 million.

Annual minimum taxes based on gross receipts:

• $150,000 to $1 million: $150
• $1 million to $2 million: $800 plus CAT on earnings over $1 million
• $2 million to $4 million: $2,100 plus CAT
• More than $4 million: $2,600 plus CAT

9. Prepare an Ohio LLC operating agreement

While not required, an operating agreement helps multiple-member LLCs and larger enterprises run smoothly. This document outlines your business’s mission and goals, each member’s roles and responsibilities, and the distribution of shares, profits, and losses.

Your operating agreement should include your company’s legal name (including DBAs), business mailing address, and statutory agent address. Add a brief statement about your business mission and purpose.

Include clear statements about each member’s role and responsibilities, including ownership percentages, distribution amounts, and titles. Detail the process for accepting new LLC members and handling member exits. You may also specify your business duration—whether short-term or indefinite—and your tax status, such as S corp or C corp election.

10. File an Ohio BOI report

Since January 1, 2024, most new Ohio LLCs must file a BOI report within 30 days of formation. This requirement stems from the Corporate Transparency Act to prevent financial crimes.

File your BOI report directly with the Financial Crimes Enforcement Network (FinCEN) (not the Ohio Secretary of State). The report must include details about beneficial owners who control 25% or more of the LLC or have substantial control over operations.

For each owner, you’ll need to provide their full legal name, date of birth, address, and an identifying number from a passport or driver’s license. Take care with this filing—providing false information or failing to file can lead to penalties.

11. Examine business insurance options in Ohio

Your business type determines which insurance coverage you need. Physical locations need protection against property damage or customer injuries, while digital businesses might focus on cybersecurity coverage. Here are the main types of insurance to consider:

General liability insurance protects your business against customer injury lawsuits, property damage, copyright infringements, libel claims, and advertising injuries. Consider this coverage if you have a physical location.

Professional liability insurance (also called errors and omissions) protects owners when their actions cause financial damage to customers or clients. This coverage helps with contract breaches, negligence, and missed deadlines. Interior design businesses, accountants, real estate companies, and consultants often benefit from this protection.

If you store sensitive information electronically (like Social Security numbers and passwords), cyber liability insurance helps protect against data breaches, electronic theft, and fraud. It can also help cover data recovery expenses.

Workers’ compensation (workers’ comp) covers medical bills and lost wages for employees injured at work. In Ohio, you must purchase this coverage through the state, not private insurers. Any business with at least one employee needs workers’ comp, though some businesses are exempt— including sole proprietorships, general partnerships, and LLCs designated as sole proprietorships or partnerships.

12. Market your LLC

An effective marketing plan can help ensure your business makes money. Marketing helps people discover your brand, services, and products— directly impacting your success.

Build a website to stake your claim in the digital space and give potential customers a way to learn about your offerings. Buying a domain name is one of your first steps to building that online platform.

Invest in advertising based on your market research. Whether you use billboards, digital ads, flyers, or social media posts, choose strategies that will work best for your business.

Leverage social media platforms like X and Instagram to reach your target audience and assess how your demographic engages with different types of content. Draw users to your business by offering promotions, deals, or discounts when they participate in social media polls, write reviews, or sign up for email lists.

Track key metrics to gauge your marketing success. Revenue, sales growth, and customer retention numbers show whether your techniques are working. Tools like Google Analytics track web traffic and time spent on your site, helping you monitor customer behavior. You can also use SEO tools like SEMrush to track competitors’ outreach and keyword use, which helps optimize your own SEO strategies.

Is an LLC right for you?

Whether you’re just starting a business or looking to change your current business structure, an LLC can help you save money. Here are the key benefits of forming an LLC:

• Liability protection: Like LLCs, sole proprietorships and general partnerships benefit from pass-through taxation. However, only LLCs separate your personal assets from business liability. This protects you from lawsuits and shields you from personal liability for your partners’ or employees’ actions.
• Investment opportunities: An LLC designation can give your business more credibility. If you need fundraising or significant upfront capital, an LLC that shows fiscal responsibility may access small-business loans more easily than sole proprietorships.
• Structure: Unlike corporations with boards of directors, LLCs are managed directly by members or appointed managers. This gives small-business owners more flexibility in daily operations.
• Taxation: LLCs avoid corporate double taxation, where businesses pay corporate taxes on earnings and shareholders pay personal taxes on dividends. While LLCs offer multiple taxation options, they typically benefit from personal income tax rates, since business profits count as owner income.

Benefits of forming an LLC in Ohio

Planning on starting a business in Ohio? Forming an LLC might be your best move. Here’s why:

Personal asset protection 

An Ohio LLC keeps your personal assets safe. If your business faces legal issues or debts, your home, car, and savings stay protected.

Tax flexibility

Ohio LLCs receive pass-through taxation and avoid double taxation. The state offers favorable tax conditions, with no corporate income tax and a 3% pass-through entity tax. 

Simple formation process

Starting an Ohio LLC costs $99—lower than many states. You’ll mainly need to submit articles of organization to the Ohio Secretary of State.

Profit distribution flexibility

Distribute profits among LLC members as needed, regardless of ownership percentages. This lets you match distributions to member contributions and responsibilities.

Access to business incentives 

Your Ohio LLC may qualify for various programs, including tax credits, grants, and workforce development support.

Form your LLC in Ohio today

Setting up an LLC in Ohio offers numerous advantages, including asset protection, tax benefits, and credibility at low startup costs and with no annual maintenance fees. Ohio provides a cost-effective environment for entrepreneurs to establish and grow their companies.

After forming your Ohio LLC, start selling online with Shopify. Create a website, secure funding, and grow your brand using Shopify’s business tools—from customizable templates to payment processing and inventory management. Shopify provides the resources to launch your LLC successfully.

Start an Ohio LLC FAQ

How much does it cost to start and maintain an LLC in Ohio?

Starting an LLC in Ohio costs $99 for filing. Budget extra for possible needs like a registered agent or specific licenses.

Do you need a registered agent for your LLC in Ohio?

Yes, Ohio LLCs must appoint a representative to handle administrative and legal matters.

What are the drawbacks of an Ohio LLC?

The main challenge with operating an Ohio LLC is the commercial activity tax on business profits above $150,000. Sole proprietorships and general partnerships don’t pay this tax.

*This post is for information only. You are responsible for reviewing and using this information appropriately. Requirements are updated frequently and you should make sure to do your own research and reach out to professional legal, tax, and business advisers, as needed. Businesses outside of Ohio will have different steps and requirements. To sell products using the Shopify platform, you must comply with the laws of the jurisdiction of your business and your customers, the Shopify Terms of Service, the Shopify Acceptable Use Policy, and any other applicable policies.