Starting Your Business in Ohio | A Step-by-Step Guide

Start a Business in Ohio

If you want to start an LLC in Ohio, there are numerous factors to consider. Starting your own business is one of the most exciting and profitable things you can do in Ohio. But where do you start? Follow our comprehensive guide on How to Start a Business in Ohio. We will assist you in removing doubt from the process and investigate your success chances. It will begin with defining your business idea and progress to establishing, launching, and expanding your business. Webinarcare Editorial Team will help you every step of the way!

What Business to Start in Ohio?

If you’re looking to start a business in Ohio, consider starting a limited liability company (LLC). LLCs offer personal liability protection for their owners while also providing the flexibility of a partnership or sole proprietorship. Beyond that, here is the list of businesses to consider in Ohio.

  1. Glass, plastics, and rubber manufacturing
  2. Information Technology
  3. Towing Company
  4. Airbnb Business
  5. Lawn Care Business

Whatever business you choose to start, it’s important to conduct thorough market research and create a solid business plan before diving in. We reviewed some of the Best LLC Services and provided features as an add-on with their packages for you to check out.

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Starting a business can be a challenging but highly rewarding endeavor. By taking the time to research and plan, you can increase your chances of success. Whether you choose to form a corporation or start an LLC in Ohio, it’s important to surround yourself with a strong team that will guide you. Don’t let fear hold you back, take that first step towards turning your business dreams into a reality.

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How to Start a Business in Ohio?

To form a business in Ohio, you must follow a few steps that include creating a business plan, choosing a business entity type, determining your business costs, naming your business, registering a business, and lastly, marketing your business.

Please continue reading to learn more about the overall procedure and what new small business owners should keep in mind as they complete each step.

Step 1: Creating a Business Plan

When developing a business plan, many factors should be considered during the decision-making process. Your business plan in Ohio serves as a road map for your company’s success.

A business plan should take into account the specific goals of your company. You should know the product or service you will provide in Ohio. A well-thought-out business plan is essential for determining how your company will make a profit. If the purpose of the business plan is ambiguous and unrelated to the service you provide, it will impact the business you are forming. Make sure your business goals are SMART (specific, measurable, achievable, realistic, and time-bound). Also, researching your competitors’ services will help you determine your strategy for your state business. Finally, you should consider your company’s funding.

With this article’s assistance, you can better comprehend your business’s essential components and success strategy. You can apply for Ohio Small Business Loans from banks and investor funding to help support your company in Ohio.

Once you have the entire plan in your hands, you can work on the legal framework of your company. Legally, you can form an LLC for your ideal business.

Step 2: Choose a Business Entity in Ohio

Selecting a business entity for your Ohio company. When starting your own business, you must choose a business structure. How well your personal assets are secured, how much tax you pay, and how much paperwork you have to deal with will all be significantly impacted by the type of corporate entity you choose. Consider setting up a corporation, LLC, LLP, or sole proprietorship as your business entity in Ohio.

Sole Proprietorships

Consider a sole proprietorship if you want to start a business in Ohio by yourself. A sole proprietorship is the simplest business structure in which a single individual owns and operates the entire business. The owner and the business are considered the same legal entity in a sole proprietorship. There is no legal distinction between the owner and the business, meaning that the owner has complete control over the business operations, profits, and losses.

Sole proprietorships are best suited for Ohio small businesses with low risks and for individuals who want to maintain complete control over their business without the complexities of establishing a separate legal entity.

Limited Liability Company

A Limited Liability Company (LLC) is a business structure that combines features of both partnerships and corporations, offering limited liability protection to its owners (called members) while allowing flexibility in management and taxation. An LLC is a separate legal entity from its owners, meaning the members are not personally liable for the business’s debts, obligations, or liabilities.

It is a popular choice for small to medium-sized businesses that want the liability protection of a corporation while maintaining management flexibility and simpler tax treatment. It’s essential to consult with a legal or financial professional to determine if an LLC is the best choice for your specific business situation.

Limited Liability Partnership

A limited liability partnership (LLP) is comparable to an LLC. However, it is usually used by licensed business professionals like attorneys or accountants. A partnership agreement is necessary for this kind of business entity. You can form an LLP in Ohio if you are planning to.

Corporation

Forming a Corporation in Ohio reduces your personal liability for business debts as an LLC does. A corporation is a legal entity that is separate and distinct from its owners, known as shareholders. It is created under the laws of the state it is incorporated in and is considered a separate “person” under the law. The corporation can enter into contracts, own property, sue and be sued, and pay taxes separately from its owners.

A corporation can be taxed as an S-corporation (S-Corp) or a C-corporation (C-Corp). If a small corporation satisfies certain Internal Revenue Service (IRS) standards, then S-corporation status is available, providing pass-through taxation. However, most larger businesses and startups seeking venture financing are taxed as C-corps.

To choose the right business structure in Ohio, consider personal liability protection, taxation, management flexibility, administrative requirements, and setup costs. Consult a legal or financial professional to help you make the best decision.

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Step 3: Determine your Ohio Business Cost

In Ohio, you should determine the cost of your business. You should consider paying the Articles of Organization fee, business licenses fee, office supplies and equipment, payroll, rent, utilities, transportation, and taxes.

Usually, filing an initial Ohio Articles of Organization fee costs $99, while the LLC annual fee costs $91 in Ohio. In terms of filing Ohio Articles of Incorporation, the costs usually range up to $99 for online and by mail filing.

If forming an LLC is your ideal business, consider knowing the LLC Cost in Ohio.

Step 4: Name your Business in Ohio

Naming your business doesn’t take a lot of time. With the help of Ohio Business Name Search, you can acquire a name for your business. If you form an LLC in Ohio, you must follow the below rules while naming your business-

  • The name should not be confused with a government entity.
  • The name should be unique.
  • The name should be available to use.
  • Any other business does not use the name.
  • The new name must include “LLC” if it is a limited liability company.

In Ohio, if you do not wish to file your business right away but want to hold the name that you have decided on, then you can reserve your business name. You must file a name reservation application in the Ohio Secretary of State to keep the name.

If the business name is available, you may choose to reserve it for a specific period of some time. The online name reservation fee is $39 and the mail name reservation fee is $39. If your business plans to operate under a name other than its legal name, you may also need to register a fictitious or “doing business as” (DBA) name.

The DBA filing can be done in two methods, by mail and in person, which you can file in Ohio Secretary of State. You can check out how to file a DBA in Ohio for clearer understanding.

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Step 5: Register Ohio Business

To register a business in Ohio, you need to file it with the Ohio Secretary of State. Before that, you must have a Ohio Statutory Agent for your business. The Statutory Agent is a person who is responsible for receiving important legal documents on your behalf.

You can serve as your own Statutory Agent, or you can appoint a friend or family member, or you can check the Best Statutory Agent Services in Ohio.

Apply For Articles of Organization

After you have a Statutory Agent, you need to file the Ohio Articles of Organization, if you want to have an LLC structure, or you need to file the Ohio Articles of Incorporation if you want to have a Corporation.

Request For an EIN

In addition to the paperwork, your Statutory Agent should apply for an Employer Identification Number (EIN) in Ohio. An EIN will serve as the tax ID for your professional corporation. EIN can be obtained from the Internal Revenue Service (IRS). It is a 9-digit number similar to Social Security Number. EIN, however, is distinct from SSN. It is only used for business-related activities, particularly for submitting general taxes. The form must be completed and uploaded to the IRS website. You can obtain the EIN for free from the IRS.

The application of an EIN in Ohio can be through the following:

  • Apply Online- The online EIN application is the preferred method for customers to apply for and obtain an EIN.
  • Apply by Fax- Taxpayers can fax the completed Form SS-4 application to the appropriate fax number), after ensuring that Form SS-4 contains all of the required information.
  • Apply by Mail- The EIN application Form SS-4 can be filed via mail. The processing time frame to receive the mail is four weeks.
  • Apply by Telephone (for International Applicants)– International applicants may call 267-941-1099 (not a toll-free number) from 6 a.m. to 11 p.m. (Eastern Time) Monday through Friday to obtain their EIN.

After you have your EIN number, you can benefit in several ways. It will give your LLC the absolute advantage necessary to operate at full capacity without encountering legal or judicial issues.

Recommended: Professional services have the EIN included in their LLC formation package. We recommend using –

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Step 6: Apply for Business License and Permit

Business licenses and operating permits are necessary to run any business in Ohio. Before launching your new business, request any required business license or permission. Most Ohio businesses need licenses or permits to operate. Federal, state, and local governments may all require businesses to have licenses and permits. The business license fee depends on the type of license you are applying for. It can start from $25 till going up to $100+. However, in Ohio, the business license fee ranges from $50 – $300.

Step 7: Obtain a Bank Account

Your business dealings in Ohio might be simpler with a US business bank account because it boosts your company’s legitimacy and liquidity. Opening a separate bank account for your Ohio business is essential for maintaining a clear separation between your personal and business finances.

You can check out the Best Banks in Ohio, which offers the best fees, services, and convenience for your business needs.

Step 8: Market your Business in Ohio

Now that your Ohio business is registered, you can market it with an ideal marketing plan. An ideal marketing plan can help a start-up business to become known. Making a comprehensive social media network like META, Facebook, Instagram, Twitter, and YouTube falls within this category. While creating an SEO campaign for your company website, you may also look at specialized communities on Facebook and LinkedIn.

FAQs

What are the advantages of starting a business in Ohio?
Ohio has a robust economy, a favorable business climate, a skilled workforce, low cost of living, and an innovative spirit.
What are the legal requirements for starting a business in Ohio?
You will need to register your business with the Ohio Secretary of State, obtain necessary permits and licenses, file taxes, and comply with zoning laws.
How do I register my business in Ohio?
You can register your business online through the Ohio Secretary of State’s website or in person at the Ohio Business Central on the Statehouse Plaza in Columbus.
What types of business structures can I choose from in Ohio?
The most popular business structures in Ohio are Sole Proprietorship, Partnership, Limited Liability Company (LLC), and Corporation.
How do I choose a business name in Ohio?
Your business name must be unique and approved by the Ohio Secretary of State. You can search for available business names through their website.
Do I need an Ohio business license to start a business?
Not all businesses require a license in Ohio. However, some industries such as healthcare, agriculture, and construction, may require specific licenses or certifications.
What taxes will my Ohio business have to pay?
Ohio businesses are subject to several state and federal taxes, including corporate income tax, commercial activity tax, sales tax, and payroll taxes.
How do I register for Ohio state tax purposes?
Ohio has an online registration system on Ohio Business Gateway. You can register and manage all your state tax accounts through this portal.
Is there any financial assistance for small businesses in Ohio?
Yes, Ohio offers various financial assistance programs and tax incentives for eligible small businesses, especially those creating jobs and bringing innovation.
How can I obtain funding to start my business in Ohio?
There are different ways to obtain funding for your business, such as borrowing from a bank or a credit union, seeking investors, applying for grants, or using personal savings.
How do I open a business bank account in Ohio?
You will need to provide some personal and business information and documents to a bank in Ohio to open a business bank account.
Can I operate a home-based business in Ohio?
Yes, you can operate a home-based business in Ohio, but you must comply with zoning regulations, taxation, and licensing requirements for businesses operating in a residential area.
What resources are available for entrepreneurs in Ohio?
Ohio has a vibrant entrepreneurial ecosystem with several organizations and resources to support entrepreneurs, such as SCORE, the Small Business Development Center, Innovation Ohio, and JumpStart.
How can I ensure my Ohio business stays compliant with regulations and laws?
You can stay compliant by regularly reviewing and updating your legal documents, consulting with a lawyer and an accountant, and keeping accurate financial and tax records.
Do I need to obtain insurance for my Ohio business?
Depending on your business size and type, Ohio may require certain insurance policies such as workers’ compensation, liability, property, and health insurance.
How can I protect my Ohio business’s intellectual property?
You can protect your business’s intellectual property by registering patents, trademarks, and copyrights. The Ohio Secretary of State’s Office has the Ohio Business Service Center Patent and Trademark Program to help you with this.
How often do I need to file taxes for my Ohio business?
The state of Ohio requires businesses to file and pay taxes annually for some taxes, such as corporate income tax, and monthly or quarterly for some others, such as sales tax and transitional employer relief assessment (TERA).
What are the employment laws in Ohio that I should be aware of as a business owner?
Ohio has several employment regulations that employers must follow, such as minimum wage, overtime pay, anti-discrimination, and safety.
How can I hire employees for my Ohio business?
You can post your job openings online or in local newspapers, network with other business owners in your industry, and use the Ohio Means Jobs website.
What is the minimum wage in Ohio?
In 2021, the minimum wage in Ohio is $8.80 per hour for non-tipped employees and $4.40 per hour for tipped employees.
Is an operating agreement necessary for an Ohio LLC?
While not required by Ohio law, an operating agreement can protect your business interests and make your LLC operated smoothly with clear guidelines for management and ownership.
Can I operate multiple Ohio LLCs under one holding company?
Yes, a holding company can own multiple LLCs in Ohio while keeping each LLC separated according to their own business operations and tax obligations.
Can I sell products out-of-state through my Ohio business?
Yes, through ecommerce or other digital platforms, you can sell your products to customers outside of Ohio. However, you need to comply with state and federal regulations regarding sales tax, licenses, and event shipping and handling.
How long does it take to register an out-of-state corporation in Ohio?
An out-of-state corporation can operate in Ohio through a process called foreign qualification. The time needed to register varies depending on the paperwork requirements and processing time of the Secretary of State’s Office.
Can I run an Ohio business while living outside of Ohio?
Yes, as long as your business operates within Ohio’s legal framework and you comply with tax liability and registration laws.
Does Ohio have any special grant opportunities for minority-owned businesses?
Yes, Ohio has various funding and assistance programs designed for minority, women, and veteran-owned businesses, such as the Economic and Community Development Institute, The Richland Community Development Group, the Economic Development and Finance Board, and the Minority Business Accelerator.
What is the best city to start a business in Ohio?
The best city to start a business in Ohio depends on the business type, industry focus, talent pool, and customer base needed. Cities like Cincinnati, Columbus, and Cleveland have led in recent years for entrepreneurship and growth.
Can I file for a DBA name registration in Ohio?
Yes, you can file for a DBA (doing business as) name registration with the Ohio Secretary of State’s Office. The trade name must meet specific Ohio criteria and cannot violate any legal restrictions.
What structures and controls are needed for a compliant financial statement preparation or review for private companies?
Prepared financial statements require clients to have maintained certain operating documentation, defined accounting controls, processes, account reconciliations, and backup documentation; while assumptions when market trends exist have considered, among other items; or, you require realized precise financial tracking ad report. Whether a review is needed can depend on multiple factors such as certain licensing requirements or internal complexities of your growing company in Ohio.
What are the requirements for starting a business in Ohio?
Some requirements include registering for a state tax identification number and a business license.
Are there any special taxes for businesses in Ohio?
Yes, businesses in Ohio may have to pay a state corporate income tax.
How can I find resources for starting a business in Ohio?
The Ohio Small Business Development Center provides a range of resources, advice, and counseling services for business owners.
What are some good industries to start a business in Ohio?
Ohio has many strong industries, including manufacturing, finance, healthcare, and technology.
How do I register my business name in Ohio?
Business owners need to file a Name Registration Application form with the Ohio Secretary of State’s office.
What is the cost of registering a business in Ohio?
The cost varies depending on the type and size of business, but it typically ranges between $125 and $325.
Does Ohio have any programs or grants for small business owners?
Yes, the state offers financing, loans, and grants for business owners to help them grow their businesses.
Can I start a business in Ohio as a non-resident?
Yes, non-residents can start and operate a business in Ohio as long as they meet all the state’s requirements.
Do I need to obtain any permits or licenses to operate my business in Ohio?
Most businesses need to obtain specific licenses or permits from the local or state government before operating.
Does Ohio have any incentives for relocating or starting a business?
Yes, Ohio offers tax credits, loans, and other incentives to businesses that relocate or expand in the state.
How do I register my business with the Ohio Department of Taxation?
Business owners need to obtain a Tax ID number from Ohio’s Department of Taxation and start filing tax returns.
What is the process for obtaining a federal tax ID number for an Ohio business?
The process involves completing and submitting a form to the Internal Revenue Service (IRS).
Are there any training programs for new Ohio business owners?
Yes, the Ohio Small Business Development Center provides training programs to help new business owners succeed.
Can I operate my Ohio business from home?
Yes, but there may be certain zoning laws that limit certain types of home businesses.
What is the expected timeline for starting a business in Ohio?
Starting a company in Ohio generally takes four weeks to six weeks, but setting up more complex companies could take longer.
Is Ohio supportive of green and environmentally-minded businesses?
Yes, Ohio provides many programs and initiatives supporting eco-friendly and green initiatives.
What incentives does Ohio offer for brownfield development projects?
Ohio provides grants, loans, and tax incentives to encourage the cleanup of contaminated brownfield sites.
How can I find affordable office spaces in Ohio?
Among the many options for office costs in Ohio, you can look for state-subsidized co-working hubs, small business incubators, and franchises that offer franchisee-operated spaces.
How do I expand my business in Ohio?
Ohio offers many business development resources, including Small Business Development Center and networking groups, for business owners seeking growth.
What is the Unemployment Tax Rate in Ohio?
The applicable tax rate depends on the size of the unemployment insurance fund and the size of an individual business’s fund, but typically it ranges between 6% and 7.5% for corporate clients.
Does the state of Ohio charge any taxes on inventory?
Ohio doesn’t impose an inventory tax thereby making it easy to launch a business without having to worry much about these additional costs.
Are there special regulations for businesses involved in Ohio’s extractive industries?
Yes. Ohio has regulations for businesses involved in fracking, pipelines, and mining that must be met before they can operate.
How long does it usually take for a LLC to be approved in Ohio?
Processing time varies depending on the processing location, sometimes legal statues or end of the fiscal year tends to affect processing times.
Is Ohio a limited liability state?
Yes, Ohio is a limited liability state which provides additional legal protections to business owners, shielding them from the full liability of business debts.
Are social enterprises, B corporations, and non-profits legal in Ohio?
Yes, Ohio recognizes social enterprises, B corporations, and non-profits, which have become popular across the US in recent years.
What are the most successful small business ideas in Ohio?
Some of the most successful small business ideas in Ohio include consulting work, technology solutions, healthcare services, and alternative energy innovations.
Is Ohio a business-friendly state?
Yes, Ohio is a business-friendly state that offers plenty of opportunities for entrepreneurs to succeed and grow their business in many fields from finance to manufacturing.
Where can I find information and resources to help me hire employees in Ohio?
Ohio Small Business Development Center has tools for payroll tax, compliance, hiring help, and other resources like O-board to make the hiring processes seamless for small business owners.
Does Ohio have any restrictions on online regulatory activities?
Ohio isn’t known for having any restrictions specifically prohibiting the scope of online regulatory activities though business owners need to satisfy regulatory activities irrespective of their medium, be it online or offline.
Is a business license necessary for a home-based Ohio business?
Yes, some licenses still may need to file even without huge overheads or prominent features making your home become an office rather than converting an office into your home.

Also Read

Why You Should Start Business in Ohio

One of the key advantages of starting a business in Ohio is its strategic location. Situated in the heart of the Midwest, Ohio offers easy access to major markets in the United States and beyond. Whether you’re looking to expand your customer base regionally, nationally, or internationally, Ohio’s central location makes it a prime hub for business—including transportation and logistics companies.

Ohio also boasts a diversified economy that encompasses a range of industries, from automotive manufacturing and healthcare to technology and agriculture. This diversity not only provides entrepreneurs with a wide array of options for starting a business but also offers a degree of economic stability and resilience. By tapping into multiple industries, entrepreneurs can diversify their revenue streams and mitigate risks associated with industry-specific downturns.

Furthermore, Ohio has consistently ranked as one of the most business-friendly states in the nation. With low tax rates, favorable regulations, and various incentives and programs aimed at supporting small businesses, Ohio provides a conducive environment for entrepreneurs to thrive. Whether you’re a first-time business owner or a seasoned entrepreneur, Ohio’s business-friendly policies can help you minimize costs, navigate regulatory hurdles, and accelerate your growth trajectory.

In addition to its business-friendly climate, Ohio offers entrepreneurs access to a wide range of resources and support systems. From local small business development centers and chambers of commerce to venture capital firms and accelerators, Ohio provides entrepreneurs with a robust ecosystem of organizations and networks dedicated to helping businesses succeed. Whether you need assistance with business planning, marketing, financing, or networking, Ohio’s rich entrepreneurial ecosystem has you covered.

Beyond its economic and business advantages, Ohio also offers a high quality of life for entrepreneurs and their employees. With its affordable cost of living, thriving arts and cultural scene, top-notch educational institutions, and abundant recreational opportunities, Ohio provides a well-rounded lifestyle that can attract and retain talent—a crucial factor for business success. By offering a balance of work and play, Ohio provides entrepreneurs with the opportunity to build successful businesses while enjoying a fulfilling personal life.

In conclusion, if you’re considering starting a business, Ohio offers a compelling destination for your entrepreneurial endeavors. With its strategic location, diversified economy, business-friendly climate, abundant resources, and high quality of life, Ohio provides entrepreneurs with the ideal setting to launch and grow their businesses. Whether you’re a tech startup, a manufacturing company, a healthcare provider, or an agribusiness, Ohio has what you need to succeed. So why wait? Start your business in Ohio today and join the thriving community of entrepreneurs who have chosen the Buckeye State as their home base.

Conclusion

Starting a business in Ohio has unique advantages and challenges since it offers a large and diverse market, access to skilled talent, and numerous networking opportunities, making it an attractive location for entrepreneurs. However, business owners must also contend with a high cost of living, intense competition, and potentially complex regulations.

Ultimately, whether starting a business in Ohio is the right decision depends on the entrepreneur’s specific needs, goals, and industry. It is crucial to conduct thorough research and consider factors such as taxes, regulations, workforce availability, and target market when choosing a location for a new business. By carefully weighing the pros and cons, entrepreneurs can make informed decisions and set themselves up for success in the competitive Ohio business landscape.

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