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Embarking on the journey of starting your own Limited Liability Company (LLC) in Oklahoma is an exciting step towards turning your business dreams into reality. An LLC provides the perfect balance between the flexibility of a partnership and the liability protection of a corporation.
To help you navigate the process, this guide offers a concise overview of the key steps involved in establishing your LLC in the state of Oklahoma.
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Starting an LLC in Oklahoma Step-By-Step
Before diving into the formalities, it’s essential to grasp the fundamentals of an LLC. In Oklahoma, an LLC combines the limited liability protection of a corporation with the simplicity and flexibility of a partnership, making it an attractive option for small businesses.
1. Choose a Unique Business Name
The name of a newly formed limited liability company must be distinct from those of other businesses in Oklahoma, implying that the desired name may not be immediately available.
To confirm the availability of your preferred name, it’s crucial to conduct a search using the official search engine provided by the Oklahoma Secretary of State. Neglecting this name availability search could result in delays in the approval of your LLC and, ultimately, may lead to rejection.
If your desired business name is available, but you’re not yet prepared to establish your Oklahoma LLC, you have the option to reserve the name for a period of 60 days by submitting an application. This process is cost-effective, with a nominal fee of only $10.
Oklahoma LLC Naming Laws:
Naming an LLC in Oklahoma involves adhering to specific guidelines outlined by the Oklahoma Secretary of State. These regulations are designed to ensure that your chosen name meets certain standards related to distinctiveness, accuracy, and transparency.
According to Oklahoma LLC naming laws, your LLC name must:
- Be unique compared to existing business entities.
- Include a designator such as “limited liability company” or “limited company” or their abbreviations like “LLC,” “LC,” “L.L.C.,” or “L.C.,” indicating its limited liability status.
- Avoid being misleading or suggesting a purpose different from the actual nature of your business.
Consider Purchasing a Web Domain (Optional):
For many small businesses, having a website is essential, and securing a domain name that closely aligns with your business name is advisable. While researching and finalizing your business name, it’s wise to check the availability of the corresponding domain name.
If you find an available domain that you like, registering it’s an inexpensive investment. You don’t need to establish a website immediately, but securing the domain ensures it’s available when you’re ready to use it, preventing potential unavailability issues later on.
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2. Appoint a Registered Agent
Starting an LLC in Oklahoma involves careful consideration, particularly regarding the designated recipient of crucial communications for your company.
For your LLC to operate in Oklahoma, you need an agent who can accept service of process in case of legal actions against your company or act as a liaison between your business and the state.
The designated agent must possess a physical address in Oklahoma and can be:
- A resident of Oklahoma
- Another Oklahoma LLC
- A domestic or foreign business entity authorized to conduct business in Oklahoma
You also have the option to designate yourself or a member of your LLC as the agent. Depending on your business structure, opting for a third party might be a prudent choice. Some LLCs prefer to have their attorney serve as the agent to streamline the legal counsel process in case of a lawsuit.
Pro Tip: Numerous companies specialize in offering registered agent services to LLCs and other businesses in Oklahoma. It’s essential to conduct thorough research and choose a service with high ratings that aligns with your budget.
Our Picks of the Best-Registered Agent Services
When partnering with ZenBusiness, you can wave goodbye to the stress of handling paperwork. This company excels in providing a diverse range of LLC services, focusing on ensuring your business is established correctly. They specialize in completing and delivering the necessary paperwork to the appropriate state government branch.
While ZenBusiness does charge for its services, customers consistently attest to getting the best value for their investment.
Embarking on a business venture involves navigating through a plethora of state-mandated paperwork, which can be particularly bewildering for new entrepreneurs. Northwest simplifies this process by offering comprehensive business services. They assist entrepreneurs in identifying the right documentation, completing it accurately, and submitting it promptly to the relevant government agency.
Beyond helping with LLC formation, Northwest provides additional services, including registered agent services, that prove invaluable to new business owners.
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Incfile stands out by offering an extensive library of resources to guide first-time business owners in determining the most suitable business structure. Once the decision is made, Incfile steps in to assist with documentation and filing procedures, demystifying terms such as registered agent, articles of organization, and EIN.
The company has built a strong reputation and garnered positive reviews online, making it a reliable choice for entrepreneurs.
3. Submitting the Articles of Organization
In the process of establishing an LLC in Oklahoma, the next crucial step is to submit the articles of organization for your Oklahoma limited liability company, marking the official formation of your business. This essential document must contain the following information:
- The name of your LLC
- The physical address of the LLC’s place of business
- The LLC’s email address
- The LLC’s term of existence (e.g., perpetual, fixed number of years, fixed dissolution date)
- Signature of a member, manager, or representative of the LLC
For electronic filing of the articles of organization, you can utilize Oklahoma’s entity filing webpage or opt for the traditional method of mailing it to the Oklahoma Secretary of State at the following address:
OKLAHOMA SECRETARY OF STATE
Business Filing Department
421 N.W. 13th, Suite 210
Oklahoma City, OK 73103
Insider Tip: Whether you choose online submission or the mail-in option, the filing fee remains $100. Completing the form typically takes around five minutes, with online processing taking only one to two business days. If opting for a paper copy through mail, expect a processing time of approximately three to four weeks.
Registration for Foreign LLCs
If your LLC, established outside of Oklahoma, plans to conduct business within the state, you must follow these steps:
- Adhere to Oklahoma LLC naming guidelines and verify the availability of your LLC’s name in the state through the Oklahoma Secretary of State Business Entity Database. If the name is unavailable, you need to complete and attach a Statement of Fictitious Name Report along with your application.
- Designate an Oklahoma registered agent.
- File an Application for Registration of a Foreign Limited Liability Company with the Oklahoma Secretary of State. This application can be submitted online or by mail, with a filing fee of $300.
The application must be accompanied by either a Certificate of Good Standing or a Certificate of Existence from the LLC’s home state, dated within the last 60 days.
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4. Draft an Operating Agreement
Although not mandatory for the establishment of an Oklahoma LLC, crafting an operating agreement is advisable to preempt any potential complications in your business operations.
This document delineates the financial and operational decisions essential for the business, clarifying the roles and responsibilities of each member while establishing protocols for both routine activities and unforeseen emergencies.
In cases of single-member LLCs, the choice to forgo a formal operating agreement may be made since a sole member is solely responsible for business conduct. However, for LLCs with multiple members or employees, operating without an agreement increases the risk of confusion.
Consider this scenario: a two-member Oklahoma LLC verbally agrees to allocate half of its profits annually for reinvestment in the business. A year later, when it’s time to implement the agreement, one member denies ever consenting, leading to a conflict that ultimately dissolves the LLC. With a documented operating agreement capturing this verbal pact, such conflicts can be averted.
Insider Tip: The unpredictable nature of the future may even result in the dissolution of your LLC. Incorporating a section in your operating agreement regarding the dissolution process replaces default Oklahoma rules that may not align with your company’s best interests. For instance, the default rule requires unanimous consent for dissolution, but you might prefer a majority vote, a provision enforceable if stipulated in your operating agreement.
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5. Obtain Your EIN
Having navigated the process of initiating an LLC in Oklahoma, you may be contemplating the ongoing requirements for maintaining your business. Irrespective of whether your enterprise employs staff, an employer identification number (EIN) is a necessity for all businesses operating in Oklahoma.
Why is an EIN necessary? An EIN is vital for the following purposes:
1. Opening a business bank account for the company
2. Complying with federal and state tax obligations
3. Hiring employees for the company
Where can I obtain an EIN? Business owners can secure an EIN from the IRS at no cost after the formation of the company. This can be accomplished either online or through mail.
FOR INTERNATIONAL APPLICANTS: It’s important to note that an SSN (Social Security Number) isn’t required to obtain an EIN.
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6. Submit the Annual Certificate
LLCs in Oklahoma must submit an annual certificate, also known as an annual report, to the Secretary of State. This can be done online or through mail, accompanied by a $25 filing fee.
The annual certificate is required to be filed by the end of the anniversary month of the LLC’s formation each year. While Oklahoma doesn’t impose late fees for missing the filing deadline, the state will revoke the “good standing” status after 60 days. Failure to file the annual certificate for three consecutive years may result in the dissolution or revocation of the LLC by Oklahoma.
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7. Secure Business Licenses and Permits
While Oklahoma doesn’t have a comprehensive general business license, various cities and counties within the state do. For instance, businesses operating in Oklahoma City are mandated to acquire a general business license.
The specific license or permit your business needs depends on its nature and location. Consider the following potential licenses and permits:
- Sales Tax Permit
- Professional and Occupational Licenses
- Liquor License
- Health Permits
- Home Occupation Permit
- Building and Construction Permits
- Environmental Permits
- Agricultural Permits
To access a comprehensive list of activities requiring licenses or permits, consult the Oklahoma Department of Commerce website.
Federal Permits and Licenses
Certain federal licenses and permits may be necessary based on your business activities or industry. Examples include:
- Alcohol and Tobacco Tax and Trade Bureau (TTB) Permits: Businesses involved in alcohol, tobacco, or firearms may need TTB permits for legal operation.
- Federal Communications Commission (FCC) License: Telecom businesses often require an FCC license for legal operation.
- Food and Drug Administration (FDA) Registration: Businesses dealing with food, drugs, medical devices, or cosmetics may need FDA registration.
- Transportation-Related Permits: Businesses in interstate transportation may require federal licenses from agencies like the Department of Transportation (DOT).
- Environmental Permits: Businesses handling hazardous materials or impacting the environment may need permits from federal agencies like the Environmental Protection Agency (EPA).
- Aviation and Aerospace Licenses: Companies in the aviation and aerospace sectors may require licenses or permits from the Federal Aviation Administration (FAA).
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8. Requirements for Filing Taxes for an Oklahoma LLC
To maintain your business’s good standing, it’s crucial to stay informed about the tax obligations associated with your Oklahoma Limited Liability Company (LLC).
Depending on your business’s nature, you might need to enroll for one or more types of taxes:
Oklahoma Sales Tax
If your business involves selling physical products, it’s generally necessary to obtain a seller’s permit through the Oklahoma Taxpayer Access Point website.
Oklahoma’s state sales tax rate is 4.5%, with many cities and counties imposing additional local sales taxes of up to 5.5%. A comprehensive list is available on the State of Oklahoma’s official website.
Oklahoma Employer Taxes
For those with employees in Oklahoma, registration for Unemployment Insurance Tax through the Oklahoma Employment Security Commission is mandatory. Additionally, you must sign up for Employee Withholding Tax through the Oklahoma Tax Commission.
Income Tax
- State: Oklahoma’s individual income tax is structured into six brackets, with tax rates ranging from 0.25% to 4.75% based on your LLC’s income.
- Federal: Report federal income tax using either Form 1065 (for multi-member LLCs) or Form 1040 Schedule C (for single-member LLCs). State tax returns are due annually, coinciding with the federal return deadline. For tax calculations or to determine your bracket, refer to the Oklahoma Tax Commission website.
Hiring Employees in Oklahoma
If you’re planning to hire employees for your Oklahoma LLC, ensure compliance with the law by following these steps:
- Verify that new employees are eligible to work in the US
- Report new hires to the state
- Provide workers’ compensation insurance for employees
- Withhold employee taxes
- Display workplace compliance posters prominently in visible areas of your workspace
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How to Start an LLC in Oklahoma – FAQs
How Can I Come Up With a Business Name Effectively?
Opt for a memorable and catchy name that customers can easily recall when they require services your company offers. Utilize techniques like alliteration or wordplay to enhance memorability.
Verify social media availability. Once you confirm your preferred name’s availability as a domain, check its presence on social media platforms. Using your business name as a handle on platforms like Twitter or Instagram can establish a searchable online presence, aiding customers in finding you and bolstering your brand.
Are the Filing Requirements Different for Single-Member LLCs in Oklahoma?
The filing process for single-member LLCs mirrors that of multi-member ones. While filing the articles of organization is essential, even with a sole member, having an operating agreement can still be advantageous for your company.
What Advantages Come With Forming an LLC in Oklahoma?
Forming an LLC in Oklahoma is a cost-effective way to launch a business. LLCs offer a flexible structure, fewer record-keeping demands than corporations, and limited liability protection for personal assets. They also operate as pass-through entities for tax purposes.
How Do I Dissolve an LLC in Oklahoma?
To close an Oklahoma LLC, follow the dissolution process outlined in your LLC’s operating agreement. Subsequently, submit the Articles of Dissolution to the Secretary of State, accompanied by a $50 fee.
How Can I Search for an LLC in Oklahoma?
The Secretary of State website allows you to search for Oklahoma LLCs by name, offering advanced search options such as filing number search, active status search, name availability search, and searches for banks, churches, domestic cooperatives, and registered agents.
Can Foreign Llcs Operate in Oklahoma?
Yes, foreign LLCs can conduct business in Oklahoma by filing an Application for Registration with the Secretary of State. This application, akin to the Articles of Organization, includes additional details like the LLC’s jurisdiction and formation date.
What Ongoing Obligations Does My LLC Have in Oklahoma?
To maintain your LLC’s active status and business eligibility in Oklahoma, file an annual certificate by your anniversary date, accompanied by a $25 fee. Failure to file within 60 days of the anniversary places your LLC in “not in good standing,” limiting your ability to file documents or pursue legal proceedings.
If not rectified within three years, your LLC moves into “canceled” status, making your name publicly available after six years.
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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.