Step 1. Decide on a Legal Structure
The most common legal structures for a small business are:
There also are special versions of some of these structures, such as limited partnerships and S corporations. You’ll want to consider which Nebraska business entity structure offers the type of liability protection you want and the best tax, financing, and financial benefits for you and your business. You can check out our earlier blog post here on why entities are important. We also have a blog post on the differences between a Nebraska LLC and a Nebraska S Corp available here.
Step 2. Choose a Name
For LLCs and corporations, you will need to check that your name is distinguishable from the names of other business entities already on file with the Nebraska Secretary of State (SOS). You can check for available names by doing a search on the Nebraska Secretary of State website here. You can reserve an available name for twelve months by filing an Application for Reservation of Name with the Nebraska Secretary of State (there are separate forms for LLCs and corporations). You can reserve a name for up to 120 days. There are also certain name requirements for LLCs and corporations (like including a word such as “LLC” for LLCs or “Company” for corporations).
Sole proprietorships and partnerships in Nebraska have the option file a Trade Name Application with the Nebraska Secretary of State if they use a business name that is different from the name of the business owner (for a sole proprietorship) or individual partners (for a partnership). Nebraska Trade names expire after ten years.
If you plan on doing business online, you may want to register your business name as a domain name. In addition, to avoid trademark infringement issues, you should do a federal and state trademark check to make sure the name you want to use is not the same as or too similar to a name already in use.
Step 3. Create Your Business Entity
Step 4. Licenses and Permits
Tax Registration. If you will be selling goods in Nebraska, you must register with the Nebraska Department of Revenue (DOR) for a sales tax permit. If you will have employees in Nebraska, you must register with the DOR for employer withholding tax. For both types of registration, you can use Form 20, Nebraska Tax Application.
EIN. If your business has employees or is taxed separately from you, you must obtain a federal Employer Identification Number (EIN) from the IRS. Even if you are not required to obtain an EIN, there are often business reasons for doing so. Banks often require an EIN to open an account in the business’s name and other companies you do business with may require an EIN to process payments. You can get an EIN by completing an online application on the IRS website. There is no filing fee.
Regulatory licenses and permits. These cover areas such as:
For regulatory licenses and permits issued by the state, check theBusiness Licensing Resources section of the nebraska.gov website. For information about local licenses and permits, check the websites for any cities or counties where you will do business.
Professional and occupational licenses. These cover people who work in various fields. In many cases, you can get the basic licensing information by going to the Professions & Occupations section of the Nebraska Department of Health and Human Services (DHHS) website. For professions not listed on the DHHS website, such as doctors, lawyers, accountants, architects, and engineers, you’ll need to check the website for the state regulatory board for your profession (for example, the Nebraska Board of Engineers and Architects or the Nebraska Clerk of the Court).
Step 5. Business Location and Zoning
You’ll need to pick a location for your business and check local zoning regulations. That includes if you work from home. You may be able to find zoning regulations for your town or city by checking municode.com.
Step 6. Taxes and Reporting
Nebraska taxes every kind of business.
Sole proprietorships. Pay state taxes on business income as part of their personal state income tax returns (Form 1040N).
Partnerships. Partners pay state taxes on partnership income on personal tax returns. In addition, some partnerships also must file Form 1065N, Nebraska Return of Partnership Income.
LLCs. Members pay Nebraska state taxes on their share of LLC income on personal tax returns. In addition, the LLC itself must file a biennial report with the Nebraska Secretary of State in odd-numbered years. Nebraska Limited Liability Companies are taxed as corporations must also file a state corporation tax return.
Corporations. Shareholders must pay states taxes on their dividends from the corporation. A shareholder-employee with a salary also must pay state income tax on his or her personal state tax return. Moreover, the corporation itself is subject to Nebraska corporation taxes. Finally, corporations must file a biennial report with the Nebraska SOS in even-numbered years. The reporting requirement includes paying a corporate occupation tax.
If you have employees, you must also deal with state employer taxes.
And, apart from Nebraska taxes, there are always federal income and employer taxes. Check IRS Publications 334,Tax Guide for Small Business, and 583, Taxpayers Starting a Business, available at irs.gov.
Madathil Law Office LLC
angela@madathillawllc.com
https://www.madathillawllc.com/
1104 S 76th Ave
Omaha, NE 68124
T: 402.807.3174
Angela Madathil is a Nebraska business attorney, who can help create Nebraska entities, and draft Nebraska operating agreements.
DISCLAIMER: The information in this blog post (“post”) is provided for general informational purposes only, and may not reflect the current law in your jurisdiction. By visiting this website, blog, or post you understand that there is no attorney client relationship between you and Madathil Law Office LLC and website publisher. No information contained in this post should be construed as legal advice from Madathil Law Office LLC , or the individual author, nor is it intended to be a substitute for legal counsel on any subject matter. No reader of this post should act or refrain from acting on the basis of any information included in, or accessible through, this Post without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue from a lawyer licensed in the recipient’s state, country or other appropriate licensing jurisdiction.
The most common legal structures for a small business are:
There also are special versions of some of these structures, such as limited partnerships and S corporations. You’ll want to consider which Nebraska business entity structure offers the type of liability protection you want and the best tax, financing, and financial benefits for you and your business. You can check out our earlier blog post here on why entities are important. We also have a blog post on the differences between a Nebraska LLC and a Nebraska S Corp available here.
Step 2. Choose a Name
For LLCs and corporations, you will need to check that your name is distinguishable from the names of other business entities already on file with the Nebraska Secretary of State (SOS). You can check for available names by doing a search on the Nebraska Secretary of State website here. You can reserve an available name for twelve months by filing an Application for Reservation of Name with the Nebraska Secretary of State (there are separate forms for LLCs and corporations). You can reserve a name for up to 120 days. There are also certain name requirements for LLCs and corporations (like including a word such as “LLC” for LLCs or “Company” for corporations).
Sole proprietorships and partnerships in Nebraska have the option file a Trade Name Application with the Nebraska Secretary of State if they use a business name that is different from the name of the business owner (for a sole proprietorship) or individual partners (for a partnership). Nebraska Trade names expire after ten years.
If you plan on doing business online, you may want to register your business name as a domain name. In addition, to avoid trademark infringement issues, you should do a federal and state trademark check to make sure the name you want to use is not the same as or too similar to a name already in use.
Step 3. Create Your Business Entity
Step 4. Licenses and Permits
Tax Registration. If you will be selling goods in Nebraska, you must register with the Nebraska Department of Revenue (DOR) for a sales tax permit. If you will have employees in Nebraska, you must register with the DOR for employer withholding tax. For both types of registration, you can use Form 20, Nebraska Tax Application.
EIN. If your business has employees or is taxed separately from you, you must obtain a federal Employer Identification Number (EIN) from the IRS. Even if you are not required to obtain an EIN, there are often business reasons for doing so. Banks often require an EIN to open an account in the business’s name and other companies you do business with may require an EIN to process payments. You can get an EIN by completing an online application on the IRS website. There is no filing fee.
Regulatory licenses and permits. These cover areas such as:
For regulatory licenses and permits issued by the state, check theBusiness Licensing Resources section of the nebraska.gov website. For information about local licenses and permits, check the websites for any cities or counties where you will do business.
Professional and occupational licenses. These cover people who work in various fields. In many cases, you can get the basic licensing information by going to the Professions & Occupations section of the Nebraska Department of Health and Human Services (DHHS) website. For professions not listed on the DHHS website, such as doctors, lawyers, accountants, architects, and engineers, you’ll need to check the website for the state regulatory board for your profession (for example, the Nebraska Board of Engineers and Architects or the Nebraska Clerk of the Court).
Step 5. Business Location and Zoning
You’ll need to pick a location for your business and check local zoning regulations. That includes if you work from home. You may be able to find zoning regulations for your town or city by checking municode.com.
Step 6. Taxes and Reporting
Nebraska taxes every kind of business.
Sole proprietorships. Pay state taxes on business income as part of their personal state income tax returns (Form 1040N).
Partnerships. Partners pay state taxes on partnership income on personal tax returns. In addition, some partnerships also must file Form 1065N, Nebraska Return of Partnership Income.
LLCs. Members pay Nebraska state taxes on their share of LLC income on personal tax returns. In addition, the LLC itself must file a biennial report with the Nebraska Secretary of State in odd-numbered years. Nebraska Limited Liability Companies are taxed as corporations must also file a state corporation tax return.
Corporations. Shareholders must pay states taxes on their dividends from the corporation. A shareholder-employee with a salary also must pay state income tax on his or her personal state tax return. Moreover, the corporation itself is subject to Nebraska corporation taxes. Finally, corporations must file a biennial report with the Nebraska SOS in even-numbered years. The reporting requirement includes paying a corporate occupation tax.
If you have employees, you must also deal with state employer taxes.
And, apart from Nebraska taxes, there are always federal income and employer taxes. Check IRS Publications 334,Tax Guide for Small Business, and 583, Taxpayers Starting a Business, available at irs.gov.
Madathil Law Office LLC
angela@madathillawllc.com
https://www.madathillawllc.com/
1104 S 76th Ave
Omaha, NE 68124
T: 402.807.3174
Angela Madathil is a Nebraska business attorney, who can help create Nebraska entities, and draft Nebraska operating agreements.
DISCLAIMER: The information in this blog post (“post”) is provided for general informational purposes only, and may not reflect the current law in your jurisdiction. By visiting this website, blog, or post you understand that there is no attorney client relationship between you and Madathil Law Office LLC and website publisher. No information contained in this post should be construed as legal advice from Madathil Law Office LLC , or the individual author, nor is it intended to be a substitute for legal counsel on any subject matter. No reader of this post should act or refrain from acting on the basis of any information included in, or accessible through, this Post without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue from a lawyer licensed in the recipient’s state, country or other appropriate licensing jurisdiction.
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