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How to Form an LLC in Nebraska – Step-By-Step Guide 2024

How to Form an LLC in Nebraska
(Last Updated On: March 1, 2024)

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Starting a Limited Liability Company (LLC) in Nebraska is a straightforward process that offers entrepreneurs a flexible and protective business structure. Nebraska provides a favorable environment for small businesses, and forming an LLC here involves a series of essential steps.

From selecting a unique and suitable business name to filing the necessary paperwork with the Nebraska Secretary of State, entrepreneurs must navigate through specific legal requirements. Understanding how to start an LLC in Nebraska ensures compliance with state regulations and establishes a solid foundation for the business to thrive. 

In this guide, we’ll explore the key steps involved in initiating and successfully establishing an LLC in the Cornhusker State.

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Starting a Nebraska State LLC in 7 Easy Steps

1. Choosing a Name for Your Nebraska LLC

When deciding on a name for your company, you select the initial connection point between your business and potential customers and partners. It’s crucial to opt for a memorable name that encapsulates your business’s essence. During the brainstorming process, it’s essential to consider the naming criteria established by the state. Your chosen name must:

  • Include the phrase “limited liability company” or “limited company” or the abbreviations “LLC,” “L.L.C.,” “L.C.,” or “LC.” The term “limited” can be abbreviated as “Ltd.,” and “company” can be abbreviated as “Co.”
  • Avoid words or acronyms that could be confused with a government agency, such as “NSA” or “Department of Education.”
  • Omit words implying special licensure without state approval, for example, “University” or “Banking.”

The first step in this process is to check the availability of your chosen Nebraska LLC name. It must be entirely distinct from any other entity already conducting business in the state. If your initial search reveals that your preferred name is unavailable, there are strategies to make it distinguishable from existing records without losing its essence. These strategies include:

  • Substituting one of your keywords with a synonym (e.g., “Corn-elicious LLC” becomes “Kernel-icious LLC”).
  • Rearranging the order of your keywords (e.g., “Freshly Popped Corn LLC” becomes “Corn Popped Fresh LLC”).

If you have identified the perfect name and wish to secure it, consider the Nebraska LLC name reservation. For a fee of $30, this application will preserve your right to use the selected name for 120 days.

Important Note: While you may be eager to promote your LLC, you should refrain from investing in marketing or signage featuring your LLC’s name until after the state approves your company. If, for any reason, your chosen name is unavailable, you will need to select a new one.

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2. Designate a Registered Agent for Your Nebraska LLC

Selecting your registered agent is one of your company’s most pivotal decisions. This individual or entity assumes the crucial role of accepting legal documents on behalf of your Nebraska LLC and serves as the primary point of contact for state correspondence.

Who Qualifies as a Registered Agent?

Your chosen agent can be any individual possessing a Nebraska address or an entity authorized to conduct business within the state. While many companies opt for their manager or a member to fulfill this role, numerous other excellent options are available.

Opting for the LLC’s attorney as the registered agent can facilitate a streamlined counseling process, ensuring prompt access to legal advice for the company. Alternatively, a popular choice is to engage the services of a registered agent service specifically dedicated to serving as the primary point of contact for LLCs.

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3. Submit Your Nebraska LLC Certificate of Organization

The submission of your certificate of organization is the pivotal step that formalizes the establishment of your LLC. This document is the official application to the state seeking approval for your company to commence business operations. It contains crucial information necessary for contacting your LLC, encompassing:

  • Name of your Nebraska LLC
  • Physical and mailing addresses for your LLC’s office
  • Name and address of your registered agent
  • Printed name and signature of the LLC’s organizer

Upon submission and processing of the organization document, your LLC becomes effective immediately. If you prefer a later effective date, you can specify it in the document. Regarding LLC formation in Nebraska, different fees apply depending on whether you file in-office ($110) or utilize the online portal ($100).

What If My Nebraska LLC Intends to Provide Professional Services?

Compliance with professional LLC requirements is necessary if your LLC aims to offer services requiring a license (e.g., real estate, medicine, or law practice). Crucially, you must submit a Nebraska LLC registration certificate demonstrating that all company members hold licenses in the same profession.

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4. Publicize Your Notice of Organization

While the certificate of organization informs the state about the establishment of your LLC, the publication serves the purpose of notifying the public about your newly formed LLC. To meet acceptance criteria, your publication must feature in a “legal” newspaper as an advertisement for at least three weeks. The chosen newspaper should enjoy general circulation in your business’s county and boast at least 300 subscribers.

The details provided in the publication furnish all necessary contact information for members of the public seeking to connect with your LLC, including:

  • The name of your Nebraska LLC
  • The name and address of your registered agent
  • The address of your LLC’s office
  • Indication of whether your company offers professional services

Upon completing the three-week publication cycle, the newspaper will furnish you with proof of publication. This document can be submitted to the state either online or by mail. To verify receipt by the state, you can cross-reference your LLC’s permanent record through a business search.

Pro Tip: As with any crucial documents, it’s advisable to retain a copy of the proof of publication before submitting it to the state office. This precaution ensures you have a backup in case of processing issues or other unforeseen complications.

5. Draft an Operating Agreement

While forming a Nebraska LLC doesn’t necessitate the creation of an operating agreement, establishing one is beneficial for maintaining the stability and smooth operation of your company. An operating agreement serves as a blueprint for the company’s business activities and serves as a documented record of member decisions and relationships within the LLC. 

Some typical provisions to incorporate into an operating agreement include:

  • Division of ownership
  • Allocation of profits and losses
  • Accounting and financing specifics
  • Voting procedures
  • Procedures for admitting new members
  • Guidelines for transferring shares

Failing to implement an agreement means that your LLC will be governed by default LLC laws in Nebraska, which may not be in the best interest of your business. Numerous online services provide free templates and can assist in generating a customized agreement for your LLC.

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6. Obtain an EIN

You can acquire an Employer Identification Number (EIN) from the IRS at no cost. This number serves to identify a business entity and facilitates the tracking of a business’s tax reporting, essentially functioning as a Social Security number (SSN) for the company.

Why is an EIN necessary? An EIN is a prerequisite for the following purposes:

  • Opening a business bank account for the company
  • Federal and state tax-related matters
  • Hiring employees for the company

Where can I obtain an EIN? Business owners can obtain an EIN from the IRS at no cost after the company’s formation. This process can be completed either online or through mail.

FOR INTERNATIONAL APPLICANTS: An SSN isn’t required to obtain an EIN.

Correspondence to:

Internal Revenue Service

Attention: EIN Operation

Cincinnati, OH 45999

Fax: (855) 641-6935

Cost: No charge

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7. Annual Filings for Nebraska LLCs

Every LLC must submit a report biennially, due on April 1, commencing in the subsequent odd year following the LLC’s formation. For instance, an LLC formed in 2022 should file its initial annual report by April 1, 2023. 

Conversely, an LLC established in 2023 will file its first report by April 1, 2025. Failure to file by June 1 of the due year could result in delinquency, potentially leading to dissolution. The filing fee for this report is $25.

Ensure Regulatory Compliance for Your Company

Nebraska LLC Business Licensing and Permits

Adherence to federal, state, and local government regulations is essential to operate your LLC seamlessly. The fees and prerequisites for licenses and permits will vary depending on the type of business license required.

Discover how to obtain the necessary business licenses and permits for your LLC with the assistance of our Nebraska Business License guide.

Recommended: Consider utilizing professional services to research your business’s licensing requirements. Read our comprehensive review of the best business license services.

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Nebraska LLC Tax Filing Obligations

Keeping current on Nebraska LLC taxes is imperative. Depending on your business’s nature, you might need to register for one or more tax forms:

Sales Tax

Registering for a seller’s permit through the Nebraska Department of Revenue website is typically necessary if your business sells physical products.

Nebraska’s base state sales tax is 5.5%, with the possibility of additional local sales taxes of up to 2% imposed by city and county governments.

Employer Taxes

For employers, registration for the Unemployment Insurance Tax with the Nebraska Department of Labor and the Employee Withholding Tax with the Department of Revenue is required.

Income Tax

State:

Nebraska enforces a graduated individual income tax rate, ranging from 2.46% to 6.64%, based on your LLC’s income.

State tax returns are due annually by April 18. To calculate your tax or determine your tax bracket, visit the Nebraska Department of Revenue website.

Federal:

Reporting federal income tax is also necessary, using either Form 1065 (for multi-member LLCs) or Form 1040 Schedule C (for single-member LLCs).

Hiring Employees in Nebraska

If you intend to hire employees, ensure compliance with the law by following these steps:

  • Verify the eligibility of new employees to work in the US
  • Report employees as “new hires” to the state
  • Provide workers’ compensation insurance for employees
  • Withhold employee taxes
  • Display workplace compliance posters visibly in your workspace

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How to Start an LLC in Nebraska – Buyer’s Guide

What Is a Limited Liability Company (LLC)?

An LLC, or limited liability company, is a widely chosen business entity among entrepreneurs throughout the United States. Its popularity primarily stems from the legal protections and favorable tax treatment provided to those who own an LLC. These advantages encompass:

  • Separation of Personal and Business Assets: Members, the owners of LLCs, typically bear no personal responsibility for the business debts of the LLC. Instead, the LLC itself assumes liability for such debts, effectively shielding members from potential damages arising from legal claims against the LLC.
  • Pass-Through Taxation: Another key advantage of operating a small business in Nebraska as an LLC is the tax treatment it receives. LLCs benefit from “pass-through” tax status, meaning that the profits of the LLC are taxed only once on its members’ personal income tax returns at their respective personal tax brackets. Also, LLCs typically avoid corporate taxes on business income unless members opt for taxing the business as an S corporation.

How Does a Nebraska LLC Differ From Other Business Entities?

Before delving into the procedural steps, it’s crucial to ascertain whether a Nebraska LLC is the optimal structure for your business. Business entities can generally be categorized into two main types: informal and formal. The suitability of each type is predominantly determined by the nature of the business activities you intend to undertake.

Informal Associations

An informal association is characterized by the absence of any requirement to file paperwork with the Nebraska secretary of state for business operations. The primary forms of informal business entities include sole proprietorships and general partnerships.

  • Sole Proprietorship: In this setup, a single individual conducts business for profit, assuming all liability and claiming all profits as personal income. This structure is well-suited for those managing small, low-risk enterprises.
  • General Partnership: In a general partnership, two or more individuals co-own a for-profit business, sharing liability and profits. Profits are considered income for each partner and are taxed on this income annually. Partnerships are cost-effective and ideal for small, nascent operations not yet ready to formalize under state regulations.

Formal Associations

Operating as a formal association in the state necessitates filing mandated documents. The primary business structures falling under this category are corporations and limited liability companies.

  • Corporation: Owned by shareholders, a corporation assumes all liability and debts, and income is subject to “double taxation” (at the corporate level and upon distribution to employees or shareholders). This structure is optimal for those aiming to operate nationally and facilitate easy transfer of stock ownership.
  • Limited Liability Company (LLC): Combining the limited liability characteristic of a corporation with the single taxation benefits of an informal association, an LLC assumes all liability, while its members (not shareholders) are taxed once on the annual profits as personal income. An LLC can have multiple members (similar to a general partnership) or a single member (akin to a sole proprietorship).

Due to its flexibility and limited liability blend, an LLC is frequently the preferred entity for small businesses seeking to safeguard personal assets while retaining the tax advantages associated with informal associations.

Cost of Forming an LLC in Nebraska

Forming an LLC in Nebraska has an attractive price tag, thanks to its economical initial filing fees. The cost of filing for an LLC in Nebraska is only $105, making it a cost-effective choice for entrepreneurs and small business proprietors.

Additionally, Nebraska requires LLCs to submit an annual report accompanied by a fee that’s dependent on the LLC’s income. This fee typically falls within the range of $10 to $125. This yearly commitment introduces a continuous financial responsibility to your business proceedings.

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Our Picks of the Best-Registered Agent Services

ZenBusiness

When teaming up with ZenBusiness, the burden of paperwork becomes a worry of the past. Specializing in a comprehensive array of LLC services, ZenBusiness prioritizes the accurate establishment of your business and ensures all essential paperwork is duly completed and submitted to the relevant state government office. Despite associated service fees, many clients attest to the outstanding value they receive for their investment.>> Try Out ZenBusiness >>

Northwest Registered Agent

Embarking on a business venture often entails navigating through a maze of state-mandated paperwork, which is particularly daunting for new business owners. Northwest provides a suite of business services designed to assist entrepreneurs in locating, accurately completing, and promptly submitting the required documentation to the appropriate government agency. 

In addition to facilitating LLC establishment, Northwest extends its offerings to include valuable services like registered agent assistance, proving especially beneficial for those entering the business world.

>> Start Using Northwest Registered Agent >>

Incfile

Incfile presents an invaluable resource library that proves highly advantageous for aspiring business owners seeking guidance on selecting the right business structure. Following this, Incfile offers support with necessary documentation and filing processes, demystifying concepts such as a registered agent, articles of organization, and EIN. 

With a solid reputation and positive online reviews, Incfile is a trusted partner for those entering the realm of business ownership.

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How to Start an LLC in Nebraska – FAQs

Is an LLC Service Necessary?

A business owner can independently undertake All tasks an LLC service performs independently, eliminating service fees. However, filing fees with the state or other entities are still obligatory, and additional costs may arise, although they’re likely to be lower than outsourcing. 

While LLC services benefit those who prefer not to handle the filing process themselves, they may offer access to legal services, adding value through experienced assistance. 

Alternatively, a local business lawyer can establish an LLC, albeit at a potentially higher cost than an online service. Opting for a lawyer benefits individuals seeking a personal relationship and comprehensive legal support.

How Long Does It Take To Receive Approval for an LLC in Nebraska?

While the filing office is expected to take action within 1-2 business days after submission, mail-in registrations may take up to four weeks for approval. Online registration expedites the process, potentially reducing the waiting period to as little as four business days.

Is a Business License Required in Nebraska?

The necessity of a business license in Nebraska depends on the business type and location. Various industries may mandate state or federal licenses and specific localities may impose their own business license prerequisites.

Read More: Cost to start an LLC

What Tax Flexibility Does an LLC Offer?

LLCs can undergo taxation as sole proprietorships, partnerships, C corporations (C-corps), or S corporations (S-corps), allowing members to optimize their tax liabilities.

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About the author

Dr. Gabriel O'Neill, Esq., a distinguished legal scholar with a business law degree and a Doctor of Juridical Science, is a leading expert in business registration and diverse business departments. Renowned for his academic excellence and practical insights, Dr. O'Neill guides businesses through legal complexities, offering invaluable expertise in compliance, corporate governance, and registration processes.

As an accomplished author, his forthcoming book is anticipated to be a comprehensive guide for navigating the dynamic intersection of law and business, providing clarity and practical wisdom for entrepreneurs and legal professionals alike. With a commitment to legal excellence, Dr. Gabriel O'Neill, Esq., is a trusted authority dedicated to empowering businesses within the ever-evolving legal landscape.