If you’re starting a new business or adding new locations or business lines to an existing one, you are likely wondering if registering a DBA (doing business as) or forming an LLC (limited liability company) is the best route to travel.

A DBA is an assumed (fictitious) name that an existing business has received approval to use when conducting business. An LLC is its own registered business entity.

Both options provide a way to operate under a business name other than a company’s legal name. But in addition to that similarity, they have significant differences. Choosing one or the other affects a company’s costs, compliance requirements, and other aspects of operating the business.

What Is a DBA?

A DBA or “Doing Business As” is a fictitious name registration (also known as a “trade name” or “assumed name”) that allows a business to operate under a name other than its legal name.

It’s important to know that approval of a DBA does not:

• Guarantee a business an exclusive right to its fictitious name
• Create a separate legal entity
• Offer personal liability protection

DBAs for Sole Proprietorships and Partnerships

A disregarded entity, like a sole proprietorship or partnership, may file a DBA and conduct business under that name instead of the owners’ names.

For example, suppose someone named Josie Newman plans to open a gift boutique and wants to use the name “Extraordinary Finds Gift Emporium” rather than something like “Josie Newman’s Gift Shop.” If she files (and gets approved for) “Extraordinary Finds Gift Emporium” as a DBA, she can use that fictitious name on her signs, business cards, website, and other marketing materials. She could even set up a bank account under her DBA name.

DBAs for LLCs and Corporations

A formally registered business entity, like a limited liability company or corporation, may file a DBA and conduct business under that name instead of the legal name on its registered organizational or incorporation documents filed with the state.

For instance, let’s say a restaurant is operating as an LLC registered as “Diane’s Hometown Diner, LLC.“ Suppose Diane wants to expand her offerings by providing catering services, and she wants to use the name “First-Class Catering” for that line of business. To accomplish that, she could file “First-Class Catering” as a DBA to get state approval to use that name without having to start an entirely separate company.

DBA Name Restrictions

Before filing a DBA, it’s important that entrepreneurs do a business name search to make sure their desired name isn’t already used by another business entity within the state. If the type of business conducted is similar or closely related, it’s likely the state won’t approve the fictitious name. Also, it’s beneficial to check to make sure no business in the U.S. has a registered trademark claim on the name.

Business owners must also be aware that each state has its own rules for what can or cannot be included in a business name.

Typically prohibited are acronyms or words that will mislead the public into thinking a business is something it’s not. For example, abbreviations and acronyms like “Inc.”, “LLC,” “Assoc.”, etc. may not be part of a DBA. States may also prohibit words such as “bank,” “trust,” “foundation,” “United States,” and “school” or “university.”

Generally, states also require that businesses don’t use obscene words or words that promote illegal activity in their names.

Why DBAs Must Be Filed With the State

States (and sometimes local governments) require that businesses register their DBAs so that the public and consumers know who owns and operates any business that uses a fictitious name. That disclosure is a means for helping to protect customers from shady entrepreneurs who have a reputation for doing business badly. Business owners may not use a term like “LLC” or “Inc.” behind a fictitious name because a DBA is not a legal entity in and of itself.

Several states require that the business owner filing for a DBA publishes an advertisement or notice in a general circulation newspaper or legal publication — or both — usually within the county where the fictitious name is filed.

What Is an LLC?

A Limited Liability Company (LLC) is a state-registered legal entity. Its official legal name is whatever name is on its formation documents (Articles of Organization). An LLC’s legal name does not have to include the name of its owners; it can be a fictitious name. If an LLC uses a fictitious name as its legal name, it does not have to complete a DBA filing; the business name is registered officially when the LLC’s articles of formation are approved.

LLC Name Restrictions

When forming an LLC, entrepreneurs must heed any exclusions and restrictions their state enforces. For the most part, the rules for registering an LLC’s name are similar to those when filing a DBA.

An LLC may not use a name that’s:

• Prohibited by the state
• Already used by another business entity within the state of registration
• Already used by a business anywhere in the U.S. that has a registered trademark claim on the name

Differences Between a DBA and an LLC

1. Formation Paperwork and Compliance

Filing a DBA is a simple process, requiring completing and submitting a form to the Secretary of State or other business agency to request permission to use a desired fictitious name. Generally, states require a relatively minimal one-time fee. Many states require DBAs to be renewed periodically — which can range from one year to ten years depending on the state. Otherwise, there are no ongoing business formalities (like annual reports or licenses) associated with a DBA name.

Forming a limited liability company requires completing and filing Articles of Organization (sometimes called a Certificate of Organization) with the state and paying an entity registration fee. There may be other filings, fees, reports, and requirements to fulfill as well. The requirements vary by state. Also, LLCs are governed by their LLC Operating Agreement, so owners (called members) must abide by that document’s provisions regarding the management of the company, distributions of profits, resolution of disputes among members, etc.

LLC Compliance Task Examples

• Designating a registered agent
• Obtaining business licenses and permits
• Applying for an EIN (Federal Tax ID Number)
• Filing Annual Reports
• Paying an LLC franchise tax
• Holding an Annual Meeting and recording minutes

2. Business Name Protection

When someone registers a DBA, it does not typically give them exclusive rights to use that name. Other companies may also be able to use the name in the state. While a few states protect registered fictitious names by refusing to approve overly alike names, most do not guarantee exclusivity.

Establishing an LLC offers more business name protection because the state will not usually allow the formation of another company (or a DBA) with that same name. However, if a business name is used by a company that provides products or services very different from the LLC that wants to use the name, the state might allow both companies to use the name.

Business owners can apply for a federal trademark through the United States Patent and Trademark Office (USPTO) for more extensive business name protection.

3. Business Owner Liability

A DBA does not create a business entity that is legally separate from its owners. It’s merely a name, not an entity independent from the sole proprietor, partners, or business entity that has registered to use it. So, the individual(s) or business entity responsible for the DBA is liable for any legal actions or financial problems associated with it. In the case of sole proprietors and partnerships, the individual owners’ personal property (including their home), retirement savings, bank accounts, and other assets are at risk.

An LLC, on the other hand, is a legal entity independent of its owners. That means, under most circumstances, an LLC’s members are not personally liable for the debts or legal issues of the business. As you can imagine, this offers peace of mind for entrepreneurs who want to protect their personal assets!

4. Taxes

Sole proprietorships and partnerships that operate under a DBA only have one income tax option; they are taxed as pass-through entities. All income and losses for the DBA flow through to the owners’ personal income tax returns and all profits are subject to income tax and self-employment taxes (Medicare and Social Security).

Similarly, if an LLC or corporation uses a DBA, any taxes associated with the business activity conducted under the DBA flows through to the LLC’s or corporation’s tax return. LLCs that meet the IRS’s eligibility requirements have the option of electing S Corporation tax treatment. So, instead of all business profits being subject to Social Security and Medicare taxes, only owners’ wages and salaries have those taxes levied on them. For some entrepreneurs, this might lower their overall tax burden.

Advantages and Disadvantages

To recap everything I’ve shared above, below is a glance at the potential advantages and drawbacks of a DBA vs. LLC.

DBA Advantages

• Allows sole proprietorships and partnership to creatively name their businesses
• Easy and inexpensive to establish
• Less compliance than an LLC
• Tax obligations flow through to the business owner’s tax return

LLC Advantages

• Helps prevent other businesses from using the same name in the state (a.k.a., name exclusivity)
• Establishes an independent legal entity
• Offers personal liability protection for the business owner
• Offers tax flexibility to potentially reduce a business owner’s tax liability

DBA Disadvantages

• Does not protect the name from being used by others (no name exclusivity) — in most states
• Does not establish a separate legal entity
• Does not offer personal liability protection to the business owner
• Offers no tax flexibility or savings

LLC Disadvantages

• Requires more paperwork and time to establish
• Costs more to set up and maintain
• Comes with ongoing business compliance requirements

Which One is Right for Your Business?

That’s a question to discuss with an attorney, accountant, and tax advisor! There are legal and financial ramifications when choosing how to structure and name a business. So, entrepreneurs should seek licensed professionals who can assess their specific situation and guide them to what will offer the best results.

Know that CorpNet is here as a resource, too! We can help you with business name searches to explore if the name you wish to use is available. And, after you’ve gotten expert guidance from your lawyer and tax advisor, we can handle all your essential filings to get your DBA or LLC up and running.

Have you been thinking about making your dream of starting your own business in the beautiful Pacific Northwest a reality but not sure how to begin?  This post will help guide you through the process of registering a business in Oregon.

That said, let’s get started exploring the steps needed for registering a business in Oregon.

1. Decide on a Business Name

Before you submit the necessary forms to register your business, you will need to choose a name for your business. Then you’ll need to check to see if the name is available and meets Oregon’s rules and regulations. Do an Oregon corporation search on the name to make sure no other business has claimed it. The state won’t approve a name that’s too similar to another registered business name or if the name might mislead the public.

CorpNet’s free online corporate name search tool makes it a breeze to check the availability of a name, so there’s no reason to skip this critical step in starting a business.

2. Decide on a Business Entity Type

In Oregon, you can register your business as one of various business entity types. The most common are the Oregon Limited Liability Company (LLC) and the Oregon Business Corporation (C Corporation). The Oregon Secretary of State Office has online registration forms for filing a business entity.

If you don’t register as one of the business types, then you will by default be considered a Sole Proprietorship or Partnership. While Sole Proprietorships and Partnerships come with the least complexity and costs as related to startup and ongoing compliance requirements, they’re not all they’re cracked up to be. Unlike LLCs and corporations in Oregon, these default business types are not considered separate legal entities from their owners. That means owners are held personally liable if someone sues the sole proprietorship or partnership. Also, the pass-through taxation of Sole Proprietorships or Partnerships might work against business owners financially. With all business profit and loss flowing through to owners’ personal tax returns, all business income (after allowed deductions) is taxable and subject to self-employment taxes.

Oregon also recognizes other business structures, too, including Oregon Nonprofit Corporation, Foreign Business Corporation, and Foreign Limited Liability Company. All of these business types can be registered online. You can also register as a Limited Partnership or Professional Corporation, but these structures require filing by paper rather than electronically.

3. Officially Register Your New Business

When you form an LLC or incorporate your business in the state of Oregon, you automatically gain some protection of your business name (within the state, no other LLC or corporation may use your name). You also get limited liability protection. Because your company is considered a separate legal entity from your personal self, your personal assets (such as your home, vehicle, retirement accounts, etc.) will typically be insulated from becoming used as restitution in the cases of lawsuits against and unpaid debt of your business.

You may also discover tax advantages by forming an LLC or incorporating. Definitely, talk with a tax professional to find out how each option will affect you from a tax perspective. The difference may have a significant impact on your bottom line.

Registering an LLC in Oregon

After you’ve confirmed your desired business name is available, you will want to appoint a registered agent that has a physical street address in Oregon. The state requires you have a registered agent before it will approve your request to form your LLC. For in-depth information about what requirements a registered agent must meet and what its responsibilities are, consider reading my article What Is a Registered Agent.

Next, you can officially register your LLC by filing Articles of Organization with the Secretary of State Office in Oregon. The state’s form requests the following information and some other details:

• Name of your LLC
• How long you want your LLC to be in operation
• Registered agent information
• Names and addresses of people forming your business
• Management structure of your LLC – LLCs may be member-managed or manager-managed
• Description of services being rendered – You must provide this if your LLC is providing licensed professional services
• Members’ names and addresses
• Managers’ names and addresses

Although not required by Oregon, I advise also creating an operating agreement for your LLC. This will define the roles and responsibilities of members and managers as well as lay out the internal operating procedures of your LLC. In short, it will make sure everyone working in your organization is on the same page.

Officially registering your LLC with the state is a big step but not the only one you must take. You’ll also need to take other essential tasks to set up your business, including:

• Obtain your Employer Identification Number (EIN), which is also referred to as a Federal Tax ID Number.
• Open a business bank account. As an LLC, you’re required to keep your personal and business finances separate.
• Apply for any required business licenses and permits.
• File for trademark protection of your business name. If you wish to protect your business name in all 50 states in the U.S., file for a federal trademark through the United States Patent and Trademark Office.

Depending on the nature of your business, other requirements may apply, too. Make sure you check with the state and your local municipality to make sure you have covered all the bases.

Get professional help in registering your Oregon LLC.

Registering a C Corporation in Oregon

Just as an LLC does, you will need to designate a registered agent before registering a Business or Professional Corporation in Oregon.

Then you’re ready to file Articles of Incorporation with the Oregon Secretary of State. The information the state asks for via the form includes the following details in addition to a few other items:

• Name of your corporation
• Your registered agent information
• Number of shares your corporation is issuing – Corporations are owned by shareholders, and their percentage of ownership in the company is determined by the percentage of shares they hold
• Description of services rendered – You must provide this if you’re registering as a Professional Corporation
• Names and addresses of people forming the corporation

Other critical startup tasks to take care of after you’ve officially registered your corporation include:

• Start a records book to keep all your corporate papers, such as bylaws, stock certificate ledger, and meeting minutes, in one central place.
• Prepare your bylaws. This document will establish the ground rules for operating your corporation along with board meeting directions, the protocol for issuing stock, and other procedural information. Bylaws help everyone in an organization know how to run different aspects of the business and how to handle different circumstances. They also indicate to investors and the IRS that you operate a responsible, well-organized company.
• Appoint your directors and officers and hold your first board meeting. Corporations must have a board of directors to oversee the company and vote on strategic decisions.
• Issue company stock. Check with the Oregon Secretary of State to make sure you understand all rules and regulations that apply to you before issuing stock to your shareholders.

In addition to the corporation-specific details I mentioned above, corporations in Oregon must also tend to standard business tasks, such as:

• Applying for an EIN
• Opening a separate bank account for the business
• Filing for any applicable business licenses and permits
• Filing for a federal trademark if you want your business name to receive protection in all 50 states.

Get professional help in registering your Oregon C Corporation.

Opting for S Corporation Election

LLCs and C Corporations in Oregon may elect to have S Corporation tax treatment. With the S Corp election, business income is typically taxable on the members’ or shareholders’ individual federal tax returns. That information must then appear on the S Corp’s informational tax return via Schedule K-1. While S Corp owners pay income tax on business profits, the business must pay an excise tax for the privilege of doing business in Oregon (unless the company does not conduct business within the state). According to the Oregon.gov website, S Corporations might also need to pay state corporate income tax if they obtain income from a source within Oregon (from property located in or via business activities carried out in the state).

3. Stay In Good Standing

Officially registering your business and tackling all the startup tasks is just the beginning. To ensure you don’t lose your limited liability protection and the tax advantages that come with being an LLC or corporation, you need to follow through with Oregon’s business compliance requirements.

Contact the Oregon Secretary of State Office to find out what activities you must carry out and the filings you must make and when they’re due. The shortlist will likely include filing income tax returns, submitting annual reports, holding shareholders’ meetings, and more.

Get Help Registering Your Business

I’ve mentioned this before, but it’s worth revisiting: Rather than going it alone and making uninformed decisions, consult an attorney and tax advisor for insight and expert guidance as you embark on registering your business. Making the right choices from the start will save you a lot of time and money down the road.

And rather than handle all the details and document filings on your own, consider asking CorpNet to help you. With the expertise to file virtually all your business formation documents and track your compliance requirements and deadlines (and file your compliance paperwork) in Oregon (and the other 49 states), we can save you a heap of time and do the job more cost-effectively than if you’d enlist a lawyer to execute your filings.

Contact us today and we’ll make sure registering a business in Oregon is fast, painless, and flawless!

Think you’re the only business owner who wants to incorporate or form an LLC before the end of the year with your Secretary of State? Think again. Registering a business at the end of a calendar year can take longer than any other time of the year. Because everyone waits until the end of the year to change their business structure for the New Year, there’s a lot of competition. What might normally take just a few weeks to get approved can take a lot longer.

Waiting until December to register your business with the Secretary of State could mean that your application gets backed up into February or later. Here’s how to avoid this end-of-year crush.

How to Register a New Business to Go Live on January 1, 2023

The secret here is being proactive and getting a head start. The sooner you submit your paperwork for incorporation or an LLC, the sooner your Secretary of State can review your application and approve it. But just because your paperwork is approved doesn’t mean your new business entity has to kick in immediately, if you don’t want it to. You can designate the first day you want your new business structure to take effect.

Many businesses opt for January 1st as their activation date so that they start the New Year with a clean slate. This is also good for tax purposes. If your new business structure goes into effect during the calendar year, you essentially have to file two tax returns: one for the part of the year when you operated as a Sole Proprietor, and a second for the portion of the year that you have the new business structure.

How to File Other Paperwork With the Secretary of State

If you have other documents you need to file with the Secretary of State, such as your annual report and filing fee, DBA, or updates to your business profile that need to be amended before December 31, make sure to submit these as soon as possible.

It’s always a good idea to allow for error because there is so much mail flooding the United States Postal Service this time of year. You really don’t want your important paperwork to get lost in the sauce, so you have to plan ahead.

If there is an option to file your paperwork online, do so. You avoid the potential “lost mail syndrome” and you should be able to track the progress of your documents as they get approved.

Remember to Allow for a Margin of Error

If registering a company before year-end is something you are relying on in order to launch your business come 2023, it’s important that you start the process early enough. Mistakes do happen. You may find that you need to resubmit paperwork if you fill it out incorrectly. Don’t let your own errors get in the way of this important task.

Another option is to hire a business filing service like CorpNet. Because we have experience registering a company for thousands of businesses, we know how to get it done right the first time. We also offer expedited services that can fast-track your application and get it moved along to the top of the list.

The benefits of starting a business in Wyoming have attracted entrepreneurs because there is no state income tax for individuals or corporations and filing fees to register a business in Wyoming are quite affordable.

If you’ve been thinking about forming a business in Wyoming, then you’ve come to the right place. In this article, I’ll step you through many of the things business owners should know and address to get their new business up and running.

1. Fine-tune your business idea

Before spending time and money on starting a business in Wyoming, entrepreneurs should do their due diligence to ensure their business concept has the potential to succeed. Doing a feasibility study can help reach an informed “go” or “no go” decision. Also consider bouncing your idea by trusted advisors like SCORE mentors, business consultants, accountants, and attorneys who can help you identify red flags.

2. Write a business plan

With so many moving parts involved in starting a business in Wyoming, a business plan can help you stay focused on your business objectives and the strategies for achieving them. A business plan is a document that outlines goals and describes the efforts you will make to accomplish them. Some business plans need to be very in-depth and detailed while others can be rather short and sweet. The complexity depends on the nature of the business and whether the plan will be used to attract outside investors. Within a formal business plan, you can often find the following sections:

• Executive Summary
• Company Overview
• Products and Services Descriptions
• Market Analysis
• Competitive Analysis
• Sales and Marketing Plan
• Management and Operations Description
• Financial Projections

You can find business plan templates online that you can use as a starting point for creating your own.

3. Name your business

Besides choosing a business name that will work well for marketing and branding purposes, it’s also important to make sure the desired name is available to use in Wyoming. To find out if any other Wyoming companies are using a name, you can use CorpNet’s free Corporate Name Search tool. When registering an LLC or corporation in Wyoming, the business name becomes protected against another similar business from using the name. Registering for a state trademark can offer additional peace of mind. When forming a legal business entity, a company must comply with the entity-specific name requirements (e.g., a Limited Liability Company, must use an acceptable form of “LLC” behind it).

Sole Proprietorships and General Partnerships do not have to register their companies, but if they use a name that doesn’t include the legal names of the business owners, they must file a Registration for Application of Trade Name. When forming a legal business entity, a company must comply with the entity-specific name requirements (e.g., a Limited Liability Company, must use an acceptable form of “LLC” behind it).

Keep in mind that registering a business protects a name only within the state. Therefore, entrepreneurs that have goals to expand their business or that otherwise want to make sure their business name is protected in all 50 states can benefit from doing a trademark search. Conducting a trademark search can help identify if the desired name is available throughout the U.S. Moreover, applying for a trademark on a business name, will, if granted, ensure no other similar businesses use the name in other states.

4. Choose a business entity type

Some of the business structure types in Wyoming include Sole Proprietorships, General Partnerships, Limited Liability Companies, Limited Partnerships, and For-Profit Corporations (C Corporations). Other examples of business entities in Wyoming include the Close Corporation, Nonprofit Corporation, Statutory Trust, and Registered Limited Liability Partnership.

Which entity type will work best for your business? You’ll need to consider a variety of factors including the desire for personal liability protection, tax ramifications, ownership and management flexibility, and business compliance requirements. Let’s take a look at a few of the business entities and their characteristics.

Sole Proprietorship

• In a Sole Proprietorship, the business and its owner are considered the same entity. Therefore the assets and liabilities of the business are those of the owner, as well. While this creates simplicity operationally and from a tax perspective, it can be a disadvantage, as well. If someone sues the business or the business can’t pay its bills, the owner risks losing their personal money and property.
• Another potential disadvantage of a Sole Proprietorship is that if the owner dies, the business can only be transferred to the owner’s heirs to be continued, restructured, or dissolved.
• Sole Proprietorships have limited funding options, so investors are often hesitant to finance businesses that are not formally registered as a statutory entity.
• Sole Proprietors report their business income and losses on their individual federal tax returns.
• Because the business owner doesn’t receive a company paycheck that withholds federal income tax and Social Security and Medicare taxes, they must submit quarterly estimated federal income tax payments, which include 15.3% in self-employment taxes (similar to FICA taxes on employees’ paychecks).
• In some situations, that self-employment tax burden can become lofty and prompt a sole proprietor to look at business structures that can minimize those costs.

General Partnership

• A General Partnership is a non-registered business co-owned by two or more partners.
• Like Sole Proprietors, General Partners and their business are the same entity for legal and tax purposes.
• A General Partnership is a simple and inexpensive way to form a multi-owner business.
• There are no state, federal, or local filings to formally register a partnership, and partners can make decisions with ease without the meeting formalities required of corporations.
• A few potential disadvantages include personal liability risk to the business owners, limited funding possibilities, a heavy self-employment tax burden, and no continuity of the business’s life if a partner leaves (unless the partnership agreement has provisions to remedy that).

Limited Liability Company (LLC)

• A Limited Liability Company (LLC) provides legal and financial separation between owners (known as members) and the business. Therefore, the structure offers peace of mind to business owners who don’t want to risk having their personal belongings, bank accounts, and retirement savings from being used to settle the debts or legal problems of their company.
• From a tax perspective, however, the LLC and its members are viewed as a single tax-paying entity. Therefore the LLC’s profits and losses get reported through its owners’ federal personal tax returns.
• Single-member LLCs (disregarded entities) get taxed as Sole Proprietorships, and multi-member LLCs get taxed as Partnerships.
• Federal income tax flexibility is one of the attractive features of the LLC structure because an LLC (if it meets all IRS eligibility requirements) can elect to be taxed as an S Corporation or a C Corporation.
• LLCs in Wyoming must submit an annual report every year on the first day of the anniversary month of their formation.
• Wyoming is one of only several states to allow registration of Series LLCs, which is a variation of the LLC structure, that provides for each series to have its own membership interests, assets, and operations. In a Series LLC, each series has its own name and operates independently with its own bank account and financial records.

Limited Partnership (LP)

• A Limited Partnership has general partners and limited partners.
• The general partners are owners that manage the company. They have the same personal liability risks as in a General Partnership (because there’s no separation between the individuals and the business).
• Limited partners do not manage the company, and their role is to supply capital to the business. Their personal liability is limited to their investment in the company.
• Some potential disadvantages to an LP are that it can get complicated from an accounting standpoint, limited partners have no real say in how the company is run after they make their investments, and it can become costly to form and operate.

C Corporation (Profit Corporation)

• Wyoming businesses that operate as C Corporations offer the highest degree of personal liability protection for their owners (shareholders).
• The C Corporation is a separate entity legally and for tax purposes.
• The C Corporation reports and pays federal income tax on its profits on its own tax return.
• C Corporations must appoint a board of directors to oversee the company’s affairs and ensure the business is managed in tune with the interests of its shareholders and stakeholders.
• C Corporations have more financing options, too. They can sell stock to raise capital, and investors generally show more interest and confidence in funding businesses registered as Profit Corporations.
• The “double taxation” on C Corporations sometimes dissuades entrepreneurs from choosing this entity type. That term refers to how company profits that get distributed to shareholders as dividends are taxed twice: 1) to the corporation at the corporate tax rate; and 2) again to the individual shareholder at the applicable individual tax rate.
• Corporations that the IRS’s eligibility requirements can opt for S Corporation tax treatment to avoid double taxation.
• Other potential disadvantages of the C Corporation structure include its higher formation costs and more extensive ongoing compliance responsibilities (such as submitting annual reports, holding shareholder and board of directors meetings, and other requirements).

S Corporation

• As I discussed in the LLC and Profit Corporation overviews, an S Corporation is a tax election option rather than an entity type.
• LLCs or C Corporations that qualify can file for an S Corporation election by submitting IRS Form 2553.
• If a C Corporation ops for an S Corp election, the corporation gets pass-through tax treatment, whereby its profits get taxed at the shareholder level only.
• If an LLC opts for an S Corporation election, it retains its underlying legal structure, so compliance requirements remain minimal. It also maintains pass-through tax treatment, but unlike with the default LLC taxation, not all business profits are subject to self-employment taxes.
• Only an S Corporation’s owners’ wages and salaries are subject to Social Security and Medicare taxes; owner income that comes from company profit distributions is not subject to those taxes.

5. Appoint a Registered Agent in Wyoming

Businesses registered in Wyoming must designate a Registered Agent in the state. The Registered Agent must have a physical address in Wyoming and be available to accept “service of process” (official government documents, legal papers, etc.) for the business Monday through Friday from 9 a.m. to 5 p.m.

The ramifications are serious if an LLC, corporation, or other registered business entity fails to maintain a Registered Agent. According to the Wyoming Secretary of State Office, “All business entities filed in Wyoming shall have and continuously maintain in this state a registered agent to accept service of process. Failure to maintain a registered agent results in the dissolution or revocation of the business entity.”

CorpNet offers Registered Agent services in Wyoming and everywhere else in the U.S., which saves businesses that may want to expand into other states the trouble of looking for a Registered Agent in each state.

6. Register your business entity

Here’s a run-down of some of the initial paperwork required when starting a business in Wyoming:

• Sole proprietorship – To operate as a sole proprietor in Wyoming, business owners do not have to file any organization documents. Note that a trade name (sometimes called “doing business as” or “fictitious name”) filing is a must if the business will go by a name other than the owner’s first and last name. Also, just like formally registered businesses, sole proprietorships must obtain the required licenses and permits to operate legally in the state and local jurisdictions.
• General Partnership – The state does not require general partnerships to register their businesses formally. If using a business name that does not reflect the legal names of the business partners, the partnership must file a DBA. Also, although not required by state law, partners should consider having a written partnership agreement to document all of the responsibilities and rights of the business’s partners. General Partnerships must obtain whatever licenses and permits are required for them to operate legally in the state, county, and local municipality.
• Limited Partnership – Forming a Limited Partnership in Wyoming requires filing a Certificate of Limited Partnership and paying a filing fee of $100. With the Certificate of Limited Partnership form, the entity must also file a Consent to Appointment by Registered Agent form signed by its registered agent. LPs may elect to (but is not required to) submit a Notice of Entity Election form that provides the names and addresses of key individuals (such as managing partners) and a communications contact at the LP. As with a General Partnership, a partnership agreement isn’t mandated by the state, but it can help ensure all partners know their responsibilities and rights.
• Limited Liability Company – To form an LLC in Wyoming, Articles of Organization must be filed, along with a Consent to Appointment by Registered Agent form, which must be signed by the entity’s registered agent. To file Articles of Organization in Wyoming, an LLC must pay a filing fee of $100.00. Wyoming gives LLCs the option of submitting a Notice of Entity Election form that provides the names and addresses of key individuals (such as LLC managers) and a communications contact at the LLC; it is not a requirement, though. LLC  members should consider creating an operating agreement. The state doesn’t mandate an operating agreement, but it serves a critical role in defining how the LLC should be run and describing the responsibilities of LLC members (and managers).
• C Corporation – For a business to incorporate in Wyoming, the state requires filing Articles of Incorporation, along with a Consent to Appointment by Registered Agent form, and paying a filing fee of $100. Profit Corporations in Wyoming must also appoint a Board of Directors and adopt bylaws. Wyoming corporations have the option of submitting a Notice of Entity Election form that provides the names and addresses of key individuals (such as members of the board of directors) and a communications contact at the corporation.

7. Obtain an Employer Identification Number

Any business that hires employees must get an Employer Identification Number (EIN), which is a 9-digit ID number from the IRS. This is also referred to as a Federal Tax ID Number. Often, a bank will require that a company have an EIN before the institution will open a business bank account. Other official paperwork may ask for a business’s EIN, as well. The IRS issues EINs for free, and CorpNet can help companies by completing and submitting the application (Form SS-4) for them. Note that the IRS recently announced that it has revised its EIN application process to enhance security.

8. Open a business bank account

Keeping a business entity’s financial accounts and records separate from those of the business owners is imperative for accurate bookkeeping and legal reasons. Setting up bank accounts, credit card accounts, etc. exclusively for company use helps ensure that separation exists. If an LLC, LP, corporation, or other registered company commingles personal and business expenses and income, the owners jeopardize their personal liability protection, and other penalties could occur, as well.

9. Understand Wyoming’s business taxes

While Wyoming does not levy income taxes at the time of this writing, proposed state legislation exists that might change that for large corporations and individuals and some companies with income over $200,000. Other taxes that businesses avoid in Wyoming include gross receipts tax and inventory tax. What taxes and fees do businesses need to remit in Wyoming?

Below is a list of several that may apply:

• Annual License Tax – When an LLC, LP, or corporation submits its annual report, it must also pay an annual license tax on the business assets of registered entities in the state. The amount that a business pays depends on the value of those assets.
• State Sales Tax – Wyoming’s state sales tax rate is 4%.
• County General Purpose Tax – This tax is levied for general funding in most counties within Wyoming. It can range between .5% and 2%.
• County Specific Purpose Tax – This tax is levied in certain counties to fund specific county government projects. It can range from .5% to 2%.
• County Economic Development Tax – Currently, this tax (in increments of .25%, not to exceed a total of 1%) is only levied in Goshen County (at the time of this writing). It is collected to provide for economic development within the county.
• Unemployment Insurance Tax – Businesses with employees pay this tax, which funds a state account that compensates eligible workers for a portion of wages lost if they lose their jobs due to no fault of their own.
• Workers’ Compensation Insurance – All businesses with employees must pay this tax to provide benefits to workers who become injured or ill on the job.
• Employer Income Withholding Taxes – Businesses with employees must register with the Wyoming Department of Revenue to withhold federal, state, and local income tax and Social Security and Medicare taxes from their workers’ wages and salaries.
• Lodging Tax – This tax is applied by most local governments in Wyoming to fund local travel and tourism promotion. Hotels, motels, and other lodging businesses are required to pay the tax when renting out rooms or property. It is applied in 1% increments, with a maximum possible tax of 4%.

The Wyoming Department of Revenue can advise business owners on which taxes they must pay and how to go about paying them. An accountant or tax advisor is also a helpful resource for identifying tax obligations.

10. Obtain business licenses and permits

Depending on their industry, businesses may need to have licenses, permits, or other authorizations from the federal, state or local governments.

The Wyoming Business Council has created a comprehensive guide to business permitting and licensing. It’s a helpful resource to help you understand the various requirements that might apply to your business.

You can also turn to CorpNet to help you identify and apply for the necessary business licenses and permits required in the area where you will operate your business.

11. Research what other business essentials

• For example, businesses physically located in Wyoming must comply with the local municipality’s zoning regulations.
• You’ll also want to look into what types of insurance you might either be required or want to have to protect your business in the event of unforeseen and unfortunate circumstances.
• Another consideration is funding needs for your business. Will you need to apply for loans, seek investors, or get additional money in some other way to launch your business?
• And remember, there are many human resource-related responsibilities to tackle and regulations to follow if your business will hire employees. You can learn more about registering for payroll taxes in Wyoming to help get you started with your new staff.

12. Stay in compliance

To stay in good standing and to operate legally in the state of Wyoming, businesses must stay up to date on their report and tax filing requirements. Business owners should ask their attorneys and tax professionals if they are unsure of the obligations they need to fulfill to maintain corporate compliance. One convenient way to keep track of future filings by using CorpNet’s Compliance Portal. The free online portal makes it easy to track deadlines for license renewals, annual reports, and more.

13. Keep a resource list handy

When starting and running a business, you don’t have to go it alone. Keep a list nearby of resources you can reach out to for information and insight along the way. A few that I believe you’ll find helpful include:

• Wyoming Small Business Development Center
• Wyoming Business Council
• Wyoming Department of Revenue
• IRS Website
• Wyoming Department of Workforce Services
• U.S. Patent and Trademark Office
• SCORE
• Wyoming District Office of the U.S. Small Business Administration
• Manufacturing Works (assistance and solutions for manufacturers in Wyoming)
• Wyoming Women’s Business Center

Last but not least, CorpNet is here to help you with all of your business registration and compliance filings after you’ve consulted with legal and accounting experts to determine what you need to do. We’ll save you time and legal costs while ensuring your filings are done accurately and on time.