Steps to Starting a Business in Oregon

You’ve got an idea of a business you want to start. Now what? There can be a lot of questions, such as “Where do I start?” “What do I need to be legal?” “What if I want to have employees?” Here is my basic guide to getting your business going, adapted from the Oregon Secretary of State’s website:

 

Step 1: Create a business plan.

These can be quite lengthy, but they help you get a firm grasp on your goals and identify potential hurdles. A solid business plan is a written description of where your business will go; it defines what you plan to do and how you plan to do it.

 

Step 2: Pick your legal structure.

The main business types are sole proprietors, LLCs, and Corporations. All have different ways their owners are held liable for the company, and all have different tax structures. I recommend talking to a tax professional or business lawyer to determine which business type you should register as. A sole proprietor will pay self-employment tax (15.3%) plus federal and state withholding on their net income, as do single member LLCs. S Corps, or LLCs that file a form 2553 and elect to be treated as an S Corp, can put the officer/owner on payroll and save substantially on taxes. Again, I would direct you to a tax professional, such as Tammy at taxnbooks in Bend, to determine your business type.

 

Step 3: Pick a name.

Research available names: That may sound simple, but it isn’t always that straightforward. Start here, at the Oregon Secretary of State’s Business Name Search to see if the name you want is available: http://egov.sos.state.or.us/br/pkg_web_name_srch_inq.login.

Register your business name: Once you verify the name is available, register for that name before registering for ANYTHING else. The last thing you want is to register for a license or federal/state ID number and find out you have to change your name. Go here https://secure.sos.state.or.us/cbrmanager/index.action#stay and create a new user sign on and register your business name. Or, go here http://sos.oregon.gov/business/Pages/business-registration-forms.aspx for paper forms to register your business name.

 

Step 4: Registering and licensing.

Federal: A business needs an EIN, or Employer Identification Number. Some people also refer to this as a TIN (Taxpayer Identification Number), or an FIN (Federal Identification Number). Regardless of what you call it, you can apply for one online.  If you are a sole proprietor, you can just use your Social Security Number, but keep in mind if a customer requests your tax ID number, you’ll have to give them your SSN.

State: It’s a good idea to get an Oregon BIN (Business Identification Number), but if you have employees, this is required. This number is used to file quarterly payroll tax reports and to remit payroll taxes.

City: Business licenses are often required for the city in which your business operates.

 

Step 5: Hiring employees.

Choosing to hire employees is another topic in and of itself. Hiring does not have to feared, it simply has to be understood. Knowing what forms to file with the state and what forms must be kept in your office on record, what flyers must be posted for your employees’ information, and payroll taxes are just a few areas that you will need to understand before hiring an employee.

Payroll: Hiring a service to do your payroll is the easiest, and most reassuring method of paying your employees. A full-service payroll would include remitting taxes to the Federal/State government in a timely manner, filing quarterly and annual payroll tax reports, generating forms W2 and W3 at year end and filing year-end payroll tax reports. Broken Top Bookkeeping offers full service payroll.

You can also choose to do payroll yourself. With some training on payroll, it does not have to be a scary aspect of running your business. We also offer training on payroll and assistance with filing quarterly payroll reports.

 

We hope the above information has given you a starting place on where to start when wanting to do business in Oregon. Please check out the resources below and contact us if you have any questions, comments, or concerns!

 

 

Resources to check out to help you find answers:

  • Oregon Secretary of State Business Division has put together a fairly comprehensive PDF file on starting a business in Oregon: http://sos.oregon.gov/business/Documents/business-guides/start-business-guide.pdf
  • The Small Business Development Center at Central Oregon Community College – They offer courses and one-on-one training (for a fee) to help you identify weaknesses in your business and how to overcome them. Even their website has wonderful free tips on how to start your business, grow your business, and take it a step further with their Small Business Management Program. https://www.cocc.edu/sbdc/
  • Oregon Secretary of State Business Division – this is where it all starts, with registration and taking the first steps to being a legal business. Their website is not incredibly user friendly, but it’s a great place to start. Their Business Information Center contains detailed information on starting a business – such as creating a business plan, choosing your legal structure (Sole proprietor, LLC, S-Corp, etc), registering your chosen name, and discovering what licenses, permits or certification you may need. http://sos.oregon.gov/business/Pages/business-information-center.aspx

 

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