How to Start a Business in

Transcription

1 Oregon Business Guide How to Start a Business in Business Information Center - Corporation Division - Secretary of State

2 Dear Oregon Entrepreneur, Welcome to The Oregon Business Guide, How To Start A Business in Oregon. The Secretary of State s Corporation Division operates the Business Information Center and has published this guide. The Business Information Center is a cooperative outreach effort of many state agencies to provide information to the public on government registration and licensing requirements for businesses. This guide provides the basic information for starting a business in Oregon. There is a general checklist to guide you through the process of registering your business. It also lists business assistance programs that may be good resources as you begin and continue to operate your business. The Business Information Center also publishes a separate guide to assist business when hiring employees. The Oregon Business Guide, Employer s Guide for Doing Business in Oregon also provides a general checklist along with contact information and information on government requirements for Oregon s employers. These guides can be used independently or together depending on the specific needs of your business. Please contact the Business Information Center for further information or for any questions at Corporation Division, Secretary of State Business Information Center Public Service Building, Suite Capitol St. NE Salem, OR (503) brc.sos@state.or.us Sincerely, Bill Bradbury Secretary of State August i

3 PUBLICATION LIMITATIONS The participating government agencies share all information allowed by law and help each other enforce compliance with the individual programs. If you have any questions about the material covered in this booklet, please contact the appropriate agency. Phone numbers are listed in each section along with material provided by the agency. Information in this publication is not a complete statement of laws and administrative rules. Every effort has been made to ensure accuracy of the information at publication but it is impossible to guarantee that the information will continue to be valid. Since this publication is updated periodically, assistance with corrections and additions is welcome and should be directed to the Business Information Center by at brc.sos@state.or.us or the appropriate agency. Corporation Division, Secretary of State Business Information Center 255 Capitol St. NE, Suite 151 Salem, OR (503) brc.sos@state.or.us ii How to Start a Business in Oregon

4 NEW BUSINESS CHECKLIST Starting a successful business requires a great deal of preparation. The following is a basic checklist of recommendations to help you get your business off to a good start. For a more comprehensive checklist, please see pages Preparation Knowledge Research 2. Planning Business Wizard Seek professional advice Financing Experience Business Plan Business Assistance Programs Management & Technical Advice 3. Select Your Business Name and Structure Understand business structures Check business name for availability at 4. Register Your Business Check 5. Tax Information for Income & Businesses Federal Taxes State Taxes Local Taxes Sales Tax File personal Property Tax Obtain a Federal Tax ID number, if needed report for your business 6. Licensing Check the Business Wizard at Local licensing requirements 7. Other Requirements, if needed Check with Department of Environmental Quality Register Patents, Copyrights, Trademarks, and Service Marks Buying wholesale for your business Check Determine if you need to register as a Construction or Landscape Contractor Determine if you must comply with Americans with Disabilities Act If you use music in your business 8. Hiring Employees Review the Employer s Guide for Doing Business in Oregon at 9. Ongoing Registration Requirements Renew business registrations Renew occupational or business licenses August iii

5 TABLE OF CONTENTS NEW BUSINESS CHECKLIST... iii HOW TO START... 1 SELECT YOUR BUSINESS NAME & STRUCTURE... 5 Business Organization and Registration... 5 Real and True Name... 5 Sole Proprietorship... 5 General Partnership... 6 Corporation... 6 Domestic Corporation... 6 Foreign Corporation... 7 Limited Liability Company... 7 Domestic Limited Liability Company... 7 Foreign Limited Liability Company... 8 Limited Partnership... 8 Domestic Limited Partnership... 8 Foreign Limited Partnership... 8 Limited Liability Partnership... 9 Domestic Limited Liability Partnership... 9 Foreign Limited Liability Partnership... 9 Annual Reports... 9 Amended Annual Report Reserving a Business Name Assumed Business Names New Registration Registration Renewal Amended Registration Renew Online Sale of Securities Blue Sky Laws DETERMINE EMPLOYER STATUS Who is an Employer? Who is an Employee? Who is an Independent Contractor? BOLI and US Department of Labor Definition Internal Revenue Service Definition OREGON S MINIMUM WAGE CHECK STATE LICENSE REQUIREMENTS License Requirements CHECK LOCAL LICENSE REQUIREMENTS Local Requirements CHECK ZONING FOR BUSINESS LOCATION Zoning Requirements August v

6 OBTAIN INCOME TAX INFORMATION Federal and State Income Taxes Income Tax for Sole Proprietors Income Tax for Partnerships Income Tax for Limited Liability Companies Income & Excise Tax for Oregon Corporations Income & Excise Tax for S Corporations Estimated Income Tax Payments (Individual) Estimated Income Tax Payments (Corporations) PERSONAL PROPERTY TAX REPORT Personal Property SALES TAX INFORMATION CHECK ON OTHER BUSINESS TAXES Federal Taxes State Taxes Local Taxes FEDERAL TAX ID NUMBER (SS-4 Form) General Information Application for Tax Identification Number Apply On-Line, Phone In, Fax or Mail Your SS-4 Application CHECK WITH OREGON DEQ DEQ Requirements DEQ Handbook DETERMINE IF YOU COMPLY WITH AMERICANS WITH DISABILITIES ACT Background DETERMINE IF YOU NEED TO BECOME LICENSED WITH THE CONSTRUCTION OR LANDSCAPE CONTRACTORS BOARD Who Should be Licensed with the Construction Contractors Board (CCB)? Requirements Class of Independent Contractor Employees or Subcontractors? Applying for a License General Information Who Should be Licensed with the Landscape Contractors Board (LCB)? Requirements Class of Independent Contractor (Employer Accounts) Employees or Subcontractors? Completing the Licensing Process General Information BUSINESS ASSISTANCE PROGRAMS MANAGEMENT & TECHNICAL SERVICES Small Business Development Center (SBDC) Network SCORE vi How to Start a Business in Oregon

7 OREGON ECONOMIC & COMMUNITY DEVELOPMENT DEPARTMENT Business Development Assistance Small Business Assistance Business Retention Services Access to Markets Access to Capital Other OECDD contacts: LABOR MARKET INFORMATION Information on the Internet Labor Market Information Publications Emerging Business Assistance Programs Oregon Association of Minority Entrepreneurs (OAME) Governor s Advocate for Minority, Women & Emerging Small Business (MWESB) Opportunity Register & Clearinghouse Project Office of Minority, Women & Emerging Small Business (OMWESB) ONABEN - A Native American Business Network Downtown Development Telecommunication Assistance Employee Health Insurance Assistance Office of Private Health Partnerships (OPHP) Small Employer Health Insurance (SEHI) FINANCIAL RESOURCES Local Revolving Loan Funds Oregon Business Loans, Guarantees, Revenue Bonds and Referrals SBA Loan and Loan Guarantee Programs MARKETING & INTERNATIONAL TRADE Small Business International Trade Office Government Contract Assistance Program Agricultural Products Marketing U.S. Commercial Service/Export Assistance Center PATENTS, COPYRIGHTS & TRADEMARKS U.S. Patents U.S. Copyrights Trademark and Service Mark Oregon Trademark and Service Mark Registration Federal Trade or Service Mark Registration BUYING WHOLESALE FOR YOUR BUSINESS IF YOU USE MUSIC IN YOUR BUSINESS OREGON COUNTY ASSESSOR PHONE NUMBERS COUNTY MAP INDEX NEW BUSINESS CHECKLIST August vii

8 HOW TO START STEP 1 PREPARATION Knowledge Have experience in and knowledge of the business you plan to enter. If you don t have either, consider working in the industry or with a successful owner/operator for at least six months. Experience Have experience in management of people and finances. This is extremely helpful since the majority of businesses fail due to poor or inexperienced management. Oregon s Small Business Development Centers are an excellent resource for training and assistance. See page 26. Research Do your homework. Hours spent studying your proposed business idea can save you money in the long run by giving you the proper information to avoid unsound business decisions. Oregon s Small Business Development Centers (SBDC) provide services to anyone who owns, operates - or is considering starting - a small business in Oregon. Find the SBDC in your area at see page 26. Check with the Small Business Administration at see page 27. Consult with a SCORE counselor at see page 27. Your banker knows a great deal about your area, including average income, level of competition, real estate, and rental values. Bankers can be of great assistance if you take the initiative. Establishing a credit line with your bank can help develop a sound relationship with your banker, and a good record of repayment is an advantage when applying for business loans. Contact insurance brokers about coverage needed for your business activity and for approximate premiums. Since insurance is a competitive business, contact several agents for a comparison of both suggested coverage and premiums. Visit your local library. The librarian can help you find the information you need. Check with relevant trade associations, and the local Chamber of Commerce. STEP 2 PLANNING Business Wizard A service of the Business Information Center is the Business Wizard. Users answer a few brief questions and are provided with a customized referral list of: Government Licensing Contacts Registration Information Contacts Regulatory Contacts Organization Contacts City Contacts County Contacts 1 How to Start a Business in Oregon

9 This referral list contains phone numbers for key agency contacts and Internet links to appropriate forms, publications and information about requirements for doing business in Oregon. The Business Wizard is available at Business Plan Whether you are just starting out or already own a small business, completing a basic business plan will help you succeed. Oregon s Small Business Development Centers can offer Biz Plan Basics guiding you step by step through the fundamentals of the Who, What, Why, and How of your business. Answering a few basic questions will help you clarify and organize what you already know - or need to know - about your business operations. A clear picture of the fundamentals of your business will create a strong foundation to build new ideas, markets, and strategies. Completing this plan will also provide you with a better understanding of the financial needs and profit potential of your business. See pages Seek Professional Advice Consult two professional people: An attorney - Consider having an attorney examine the papers you sign. Get advice on any legal questions pertinent to your business such as tax law, liability issues, labor laws if you plan to hire employees or landlord-tenant laws if you plan to lease your place of business. If you do not have an attorney, you may call the Oregon State Bar toll-free at for referrals, An accountant - A CPA, a public accountant or a licensed tax consultant can advise you and possibly save you money on taxes if you are buying or starting a business. Your accountant can review tax forms with you, help you fill out the proper reports and give you prompt financial information. If you do not have an accountant, you may call the Oregon Association of Independent Accountants at , or the Oregon Society of Certified Public Accountants at , for referrals. Financing Identify how you will finance your business. New businesses often underestimate the amount of money it takes to get a business started. An entrepreneur needs to identify both the start-up capital costs and the cash-flow requirements for a business. The total of the two, plus a reserve, is the capital recommended for starting a business. Obtain information on state loan programs from the Business Finance Section, Oregon Economic & Community Development Department, , Please refer to pages in this guide for further information on financing and available resources. Business Assistance Programs Oregon has many programs available to assist businesses refer to pages for further information. Management & Technical Services Oregon s Economic & Community Development Department provides reports and services for and about Oregon businesses. They also publish the guide Doing Business in Oregon that offers information about where to look for help with your business. This guide is available at August

10 STEP 3 SELECT YOUR BUSINESS NAME & STRUCTURE Choose a Business Structure Many factors must be considered when choosing the best form of business ownership or structure. The choice you make can have an impact on multiple aspects of your business, including taxes, liability, ownership succession, and others. A legal representative and accountant should be consulted before making a determination as to the type of business entity to form. Choose a Business Name When you are ready to select a business name or assumed business name for your business, check the Business Registry database for name availability, Sole proprietors may conduct business under their own name or they may choose to use an assumed business name. See pages 6-10 for more information. STEP 4 REGISTER YOUR BUSINESS The Oregon Secretary of State s Corporation Division is the place to register your Business Corporation, Nonprofit Corporation, Limited Liability Company, Limited Liability Partnership, Assumed Business Name, and Oregon Trademark or Service Mark. Forms are available at or by calling (503) STEP 5 UNDERSTANDING TAX OBLIGATIONS Understanding your tax obligations is an important consideration for any business. You may wish to consult with a professional tax advisor or an accountant to help you understand your tax obligations. Learn about requirements to report personal property to your county assessor s office. You will also want to check on other taxes that may apply to your business. Most businesses will need to apply to the Internal Revenue Service for a federal employer identification number (EIN). See page 18 for more information on how to obtain a Federal EIN number. Depending on your situation, such as hiring employees, you may also need a Business Identification Number (Oregon Tax Identification Number). This can be obtained by completing a Combined Employer s Registration form available from the Oregon Department of Revenue or the Oregon Employment Department. Please refer to the separate publication Employer s Guide for Doing Business in Oregon. All businesses are required to file a personal property report with the county assessor s office each year. The report should include all personal property on the business premises on the assessment date. If your business has personal property in more than one county, you must submit a separate return in each county. See page 16 for more information. STEP 6 CHECK LICENSES Many occupations and business activities require special licenses, permits, registrations, or certifications from state agencies or boards. Construction and landscape contractors need to register with the Construction and Landscape Contractors Boards; Refer to pages Cities and counties may also require businesses to have a license or 3 How to Start a Business in Oregon

11 permit in order to operate. Please check with your city and county government to determine the license, permit, or zoning requirements for your area. Check Local License Requirements on page 13 for further information. The State of Oregon now offers a searchable online License Directory, a comprehensive directory of over 1,100 licenses, permits, registrations and certifications at Starting in 2006 the online License Directory began adding city, county, and special districts licensing information to the completed state licensing information as well. The Business Information Center also provides information on state license requirements at STEP 7 OTHER REQUIREMENTS Check with the Department of Environmental Quality. Some business activities will require you to contact the Department of Environmental Quality. Refer to page 19. Determine if you comply with the Americans with Disabilities Act (ADA). Many businesses are subject to this federal law that prohibits discrimination against disabled persons. Refer to page 20. Learn about registering Patents, Copyrights, Trademarks, and Service Marks with the State of Oregon and the federal government. Refer to pages STEP 8 HIRING EMPLOYEES The Business Information Center also publishes a separate guide to assist business when hiring employees. The Oregon Business Guide, Employer s Guide for Doing Business in Oregon also provides a general checklist along with contact information and information on government requirements for Oregon s employers. Review the Employer s Guide for Doing Business in Oregon, at STEP 9 ONGOING REGISTRATION REQUIREMENTS After you have established your business and fulfilled the initial requirements, you will want to make sure that you keep your reporting and registration obligations current. Businesses registered with the Secretary of State Corporation Division must file annual reports and renew their registration information. Payment coupons are mailed approximately 45 days prior to renewal due date. For more information, or to renew on-line, visit Many occupational or business licenses require annual renewal or recertification. Please visit for specific requirements. Nonprofit organizations that engage in charitable activities need to file annual reports with the Oregon Department of Justice (DOJ) s Charitable Activities Section, and the Internal Revenue Service. For more information, visit: August

12 SELECT YOUR BUSINESS NAME & STRUCTURE Business Organization and Registration You may operate a business by yourself (sole proprietorship), with another person (general partnership), or as a separate legal entity (corporation, limited liability company, limited liability partnership, or limited partnership). Each type of business structure has advantages and disadvantages. If you have questions on the form of business that is best for your particular business, a qualified tax consultant or attorney can advise you. Your local Small Business Development Center or library may also have literature or classes that will help you compare different types of business organizations. If you are a construction or landscape contractor, the Construction Contractors Board and Landscape Contractors Board can provide some information on the advantages and disadvantages of different business structures for those business activities. This section provides information on types of business organization and the registration required for each. Forms are available at Submit the completed form and a non-refundable $50 processing fee (payable to: Corporation Division) to the following address or fax number: Corporation Division Public Service Building, Suite Capitol Street NE Salem, OR Fax: US Mail Express Mail Fax In person Please allow one to two weeks for processing documents submitted by mail. Documents delivered to the Corporation Division at the above address by express delivery mail such as FedEx or UPS are processed within 24 hours of receipt. Please be aware that overnight service of the US Postal Service does not deliver directly to the Corporation Division; the US Postal Service delivers all state mail to a central location and documents received via that service are processed as regular mail. Payment must accompany the document with a Visa or MasterCard credit card number. The number and expiration date must be included on a fax cover sheet. Faxed documents are processed in the order received usually within three business days. NOTE: The fax cover sheet with the credit card number is destroyed when the document is processed. If you need to expedite the processing of a registration, documents brought to the Customer Service Counter of the Corporation Division are processed while you wait. If you would like to check a name for availability prior to submitting an application, you may check our website at However, a name availability check does not guarantee the name will still be available when the Corporation Division receives the application. Real and True Name A real and true name means the first name, middle initial or name, and last name of each business owner. For corporations, limited liability companies and other business entities, the business name registered with the Corporation Division is the real and true name of the business. Sole Proprietorship A sole proprietorship is the simplest form of business in which one individual conducts the business. The business owner is personally liable for the obligations of the business. 5 How to Start a Business in Oregon

13 A sole proprietor does not have to register with the Corporation Division unless he or she is using an assumed business name. If the name of the business does not include the real and true name of the business owner, registration as an assumed business name is required. Registration tells the public who is doing business under that business name. See Assumed Business Name Registration on page 10 for more information. General Partnership A general partnership is an association of two or more persons doing business. All partners are personally liable for the obligations of the business. A general partnership does not have to be registered with the Corporation Division unless it uses an assumed business name. If the name of the business does not include the real and true name of each business owner, registration as an assumed business name is required. Registration tells the public who is doing business under that business name. See Assumed Business Name Registration, on page 10 for more information. Legal Reference Uniform Partnership Law, ORS Chapter 68 Corporation A corporation is a legal entity created under Oregon law by submitting articles of incorporation to the Corporation Division. A corporation is owned by its shareholders, in whose names the shares are registered in the records of the corporation. The articles of incorporation must state how many shares the corporation has authority to issue. A corporation acts as a single entity. It exists separately from its owners, and continues to exist even though the shareholders may change. As a separate entity, a corporation must file its tax returns. It may own property, sue, and be sued. A corporation is managed by a board of directors. Except for the initial board, the shareholders generally select the directors. The number of directors is determined by the articles of incorporation or the bylaws. The directors must elect the president and secretary and adopt bylaws. The board may elect or appoint other officers, or the bylaws may prescribe how other officers are selected. The same person can hold two or more offices. A corporation must have a registered agent in Oregon whose street address is the registered office. When a corporation is sued, the legal papers are served on the registered agent. Thus, it is necessary that the registered office have a street address. The registered office must be a physical street address, and cannot be a Post Office box or private mailbox (PMB) at a commercial mail-receiving agency. A registered agent can be an individual or a legal entity. The three common types of corporations filed in Oregon are business corporations, nonprofit corporations, and professional corporations. Business and professional corporations are for-profit corporations. A nonprofit corporation is formed for any lawful purpose except for financial profit. A professional corporation is a for-profit corporation formed for the purpose of providing one or more specific types of professional service. All the shareholders of the professional corporation must be licensed to render one of the professional services. Corporations formed under Oregon law are domestic corporations. Those formed under the laws of other states or countries, but transacting business in Oregon, are foreign corporations. Domestic Corporation To form a domestic corporation in Oregon, articles of incorporation and a non-refundable $50 processing fee must be submitted to the Corporation Division. Before articles of incorporation are filed, the name is checked for availability. The name must be distinguishable from other active names on the division s database. Basically, a business name is distinguishable if it does not exactly copy a name already on record. If the name is distinguishable and the articles conform to Oregon law, the Corporation Division processes the document and returns an acknowledgment to the customer. Forms are available at August

14 Once the existence of the corporation is established, an organizational meeting of the board of directors is generally held to adopt bylaws and elect officers. The bylaws of the corporation may contain any provisions to regulate and manage the affairs of the corporation consistent with statutes and the articles of incorporation. NOTE: The Corporation Division does not have a separate filing for an S corporation. The S designation is a federal tax designation. A business corporation that meets the Internal Revenue Service (IRS) requirements for S corporation status can apply for federal tax status as an S corporation by filing Form 2553, Election by a Small Business Corporation, with the IRS. Form 2553 and instructions can be obtained from your local IRS office or from the IRS forms line at IRS forms are available at Foreign Corporation A foreign corporation must obtain authority from the Corporation Division to transact business in Oregon. An application of authority, including the name and address of its Oregon registered agent and a non-refundable $50 processing fee must be submitted to the Corporation Division. A certificate of existence or similar document from the jurisdiction of incorporation must be submitted with the application form. The certificate or similar document must be dated within 60 days of the date of the application. Before an application of authority is filed, the name is checked for availability. The name must be distinguishable from other active names on the division s database. Basically, a business name is distinguishable if it does not exactly copy a name already on record. If the name is distinguishable and the articles conform to Oregon law, the Corporation Division processes the document and returns an acknowledgment to the customer. Forms are available at Legal Reference Oregon Business Corporation Act, ORS Chapter 60 Oregon Nonprofit Corporation Act, ORS Chapter 65 Oregon Professional Corporation Act, ORS Chapter 58 Limited Liability Company A limited liability company (LLC) is an unincorporated association having one or more members. The LLC can be managed by managers or members. Managers can be but are not required to be members. It must be stated in the articles of organization if the limited liability company is to be managed by managers. Managers could be compared to the board of directors, and members are like the shareholders of a corporation or limited partners of a limited partnership. In order to be a member of a limited liability company, a contribution such as cash, property, or services rendered must be made. The internal affairs of the LLC are governed by operating agreements that may be oral or written. These operating agreements are comparable to the bylaws of a corporation. The internal affairs are managed by the members, unless the articles of organization specifically state that they shall be managed by one or more managers. A limited liability company must have a registered agent in Oregon whose street address is the registered office. When a limited liability company is sued, the legal papers are served on the registered agent. Thus, it is necessary that the registered office have a street address. The registered office must be a physical street address, and cannot be a Post Office box or private mailbox (PMB) at a commercial mail-receiving agency. A registered agent can be an individual or a legal entity. Limited liability companies organized under Oregon statute are domestic limited liability companies. Those formed under the laws of other states, but transacting business in Oregon, are foreign limited liability companies. Domestic Limited Liability Company To form a domestic limited liability company in Oregon, articles of organization and a non-refundable $50 processing fee must be submitted to the Corporation Division. Before articles of organization are filed, the name is checked for availability. The name must be distinguishable from other active names on the division s database. Basically, a business name is distinguishable if it does not exactly copy a name already on record. In addition, the name of the limited 7 How to Start a Business in Oregon

15 liability company must contain the words limited liability company or the abbreviation L.L.C. or LLC. If the name is distinguishable and the articles conform to Oregon statute, the Corporation Division processes the document and returns an acknowledgment to the customer. Forms are available at Foreign Limited Liability Company A foreign limited liability company must obtain authority to transact business in Oregon. An application of authority, including the name and address of its Oregon registered agent and a non-refundable $50 processing fee must be submitted to the Corporation Division. A certificate of existence or similar document from the jurisdiction of organization must be submitted with the application form. The certificate or similar document must be dated within 60 days of the date of the application. Before an application of authority is filed, the name is checked for availability. The name must be distinguishable from other active names on the division s database. Basically, a business name is distinguishable if it does not exactly copy a name already on record. If the name is distinguishable and the application conforms to Oregon statute, the Corporation Division processes the document and returns an acknowledgment to the customer. Forms are available at Legal Reference Oregon Limited Liability Company Act, ORS Chapter 63 Limited Partnership A limited partnership consists of at least one general partner and one limited partner. The general partners control the business and are liable for debts and obligations of the partnership. A limited partner is similar to a shareholder in a corporation because that person s liability is generally limited to the amount of contribution to the partnership. A limited partnership must have a registered agent in Oregon whose street address is the registered office. When a limited partnership is sued, the legal papers are served on the registered agent. Thus, it is necessary that the registered office have a street address. The registered office must be a physical street address, and cannot be a Post Office box or private mailbox (PMB) at a commercial mail-receiving agency. A registered agent can be an individual or legal entity. Limited partnerships organized under Oregon law are domestic limited partnerships. Those formed under the laws of other states or countries, but transacting business in Oregon, are foreign limited partnerships. Domestic Limited Partnership To form a domestic limited partnership, a certificate of limited partnership and a non-refundable $50 processing fee must be submitted to the Corporation Division. Before a certificate of limited partnership is filed, the name is checked for availability. The name must be distinguishable from other active names on the division s database. Basically, a business name is distinguishable if it does not exactly copy a name already on record. In addition, the name of the limited partnership must contain the words limited partnership without abbreviation. If the name is distinguishable and the certificate conforms to Oregon statute, the Corporation Division processes the document and returns an acknowledgment to the customer. Forms are available at Foreign Limited Partnership A foreign limited partnership must obtain authority from the Corporation Division to transact business in Oregon. An application for registration, including the name and address of its Oregon registered agent and a non-refundable $50 processing fee must be submitted to the Corporation Division. A certificate of existence or similar document from the jurisdiction of organization must be submitted with the application form. The certificate or similar document must be dated within 60 days of the date of the application. Before a foreign limited partnership is filed, the name is checked for availability. The name must be distinguishable from other active names on the division s database. A business name is distinguishable if it does not exactly copy a name already on record. If the name is August

16 distinguishable and the application conforms to Oregon statute, the Corporation Division processes the document and returns an acknowledgment to the customer. Forms are available at Legal Reference Uniform Limited Partnership Act, ORS Chapter 70 Limited Liability Partnership A limited liability partnership is an association of two or more persons doing business. It is restricted to partnerships that render a professional service and include: Accountants, Architects, Attorneys, Chiropractors, Dentists, Landscape architects, Naturopaths, Nurse practitioners, Psychologists, Physicians, Podiatrists, Radiology technologists, Real estate appraisers, and other persons providing to the public types of personal services substantially similar that may be lawfully rendered only pursuant to a license, or partnerships that are affiliated with a limited liability partnership and render a complementary service or provide services or facilities to the limited liability partnership. Check with your professional licensing agency or board to be sure they recognize this form of business organization before you register with the Corporation Division. Limited liability partnerships formed under Oregon statute are domestic limited liability partnerships. Limited liability partnerships formed under the laws of other states, but transacting business in Oregon, are foreign limited liability partnerships. Domestic Limited Liability Partnership To form a domestic limited liability partnership, an application for registration and a non-refundable $50 processing fee must be submitted to the Corporation Division. Before a limited liability partnership is filed, the name is checked for availability. The name must be distinguishable from other active names on the division s database. Basically, a business name is distinguishable if it does not exactly copy a name already on record. In addition, the name of the limited liability partnership must contain the words Limited Liability Partnership or the abbreviation L.L.P. or LLP as the last words or letters of its name. If the name is distinguishable and the application conforms to Oregon law, the Corporation Division processes the document and returns an acknowledgment to the customer. Forms are available at Foreign Limited Liability Partnership A foreign limited liability partnership must obtain authority from the Corporation Division to transact business in Oregon. An application for authorization and a non-refundable $50 processing fee must be submitted to the Corporation Division. A certificate of existence or similar document from the jurisdiction of organization must be submitted with the application form. The certificate or similar document must be dated within 60 days of the date of the application. Before an application for authorization is filed, the name is checked for availability. The name must be distinguishable from other active names on the division s database. Basically, a business name is distinguishable if it does not exactly copy a name already on record. In addition, the name of the limited liability partnership must contain the words Limited Liability Partnership or the abbreviation L.L.P. or LLP as the last words or letters of its name. If the name is distinguishable and the application conforms to Oregon law, the Corporation Division processes the document and returns an acknowledgment to the customer. Forms are available at Legal Reference Oregon Revised Partnership Act, ORS Chapter 67 Annual Reports Corporations, Limited Liability Companies, Limited Liability Partnerships, Limited Partnerships, and Nonprofit Corporations are required to file an annual report with the Secretary of State Corporation Division every year by the anniversary date of the registration. The Corporation Division will mail a full annual report (first annual report) or 9 How to Start a Business in Oregon

17 an annual report payment only coupon (subsequent annual report) to the business mailing address, approximately forty-five days prior to the anniversary date. NOTE: Nonprofit corporations will receive a full annual report each year. Submit the annual report payment coupon or full annual report along with a non-refundable $50 processing fee (payable to: Corporation Division) in the envelope provided. Save time by renewing your business registration online. If your business registration is due for renewal and you wish to pay with a credit card, you can renew your business online at Amended Annual Report If names or addresses need to be updated at any time after the first annual report has been filed, an amendment to the annual report must be submitted to the Corporation Division. There is no processing fee for an amendment. Forms are available at Reserving a Business Name Any person intending to organize a corporation, limited liability company, limited liability partnership, or limited partnership may reserve a name by submitting an application for name reservation and a non-refundable $50 processing fee to the Corporation Division. The name must be distinguishable from other active names on Business Registry records. If the name is distinguishable, the Corporation Division processes the document and reserves the name for 120 days. Assumed Business Names The main reason to register your business name is to tell the public (and other businesses) who is doing business under that name. A business name must be registered with the Corporation Division as an assumed business name if the real and true name of each person who is carrying on the business is not conspicuously disclosed to the public in the business name. Each person s real and true name must include first name, middle initial and last name. Nicknames are not real and true names and must be registered as assumed business names. If there are words that suggest additional owners, such as company or associates, the business name must be registered. A business name that includes the real and true names of all owners may also be registered, but the registration is optional. A corporation, limited liability company, limited liability partnership or limited partnership does not need to register its name as an assumed business name, unless the entity wants to use the name without the entity type designation. If a person transacts business with an unregistered assumed business name, he or she may not have standing in court to pursue or defend legal actions, and may find it difficult to do business, for example, getting licenses, opening bank accounts, and entering into contracts. New Registration To register an assumed business name, an assumed business name application and a non-refundable $50 processing fee must be submitted to the Corporation Division. The name must be registered in at least one county. For your convenience, there is a map of Oregon counties in the appendix of this publication, see page 40. Before an assumed business name is filed the name is checked for availability. The name must be distinguishable from other active names on the division s database. Basically, a business name is distinguishable if it does not exactly copy a name already on record. Since an assumed business name is registered by county, there may be identical names in the database but associated with different counties. If the name is distinguishable and the application conforms to Oregon law, the Corporation Division processes the document and returns an acknowledgment to the customer. Forms are available at August

18 Registration Renewal Assumed business names must be renewed every two years, prior to the second anniversary date and each two-year anniversary thereafter. Approximately forty-five days prior to the anniversary date, the Corporation Division will mail an assumed business name registration renewal payment coupon to the business mailing address. The assumed business name registration renewal must be received by the Corporation Division on or before the renewal due date to prevent cancellation of the assumed business name registration. Amended Registration Whenever there is a change in owner/registrant names or addresses, an amendment to the assumed business name must be submitted to the Secretary of State Corporation Division. There is no processing fee for an amendment. NOTE: assumed business names cannot be changed or amended once registered; a new name registration is required to register a new or different assumed business name. Forms are available at Renew Online Save time by completing your assumed business name renewal online. If your business name is due for renewal and you wish to pay with a credit card, Renew online at Legal Reference Assumed Business Name Statute, ORS Chapter 648 Sale of Securities Blue Sky Laws The Corporate Securities Section of the Department of Consumer & Business Services regulates the sale of securities in Oregon. The most common types of securities are stocks, bonds, and limited partnership interests. However, any type of agreement that obligates you or your business to pay another person part of your profits or make interest payments probably involves a security. If you plan to finance your business with funds other than your own, you may be involved in the offer and sale of securities. Oregon Securities Law, ORS Chapter 59, may require that you file an application to register your securities before you offer or sell them. Contact the Corporate Securities Section before you talk to anyone about helping to finance your business. The staff can explain the law, let you know what exemptions may be available, and provide copies of the securities law and forms required for registration. You can also find the securities law and registration forms on the Division of Finance & Corporate Securities website. If you would like to stop by and talk to someone, call first to be certain a qualified staff member will be available to assist you. Department of Consumer & Business Services Corporate Securities Section 350 Winter Street NE, Room 410 Salem, OR (voice/tty) (Toll-free) 11 How to Start a Business in Oregon

19 Who is an Employer? DETERMINE EMPLOYER STATUS Are you an employer responsible for filing and paying one or more payroll tax? If you pay someone to work for you, you are in charge of the way the job is done, and have the right to direct and control the worker, the worker is probably your employee. Oregon law differs from federal law and from state agency to agency. An employer may be an individual, corporation, partnership, estate, trust, association, joint venture, or other unincorporated organization. Religious, educational, charitable, and social organizations can also be employers, even though such organizations may be exempt from paying income tax. If you are an employer, it is recommended that you review the companion publication, the Employer s Guide for Doing Business in Oregon and contact the individual agency programs for further information. Review the Employer s Guide for Doing Business in Oregon, at Who is an Employee? An employee is anyone who performs services for pay for another person or organization under the direction and control of the person or organization. Even when the employer gives the employee freedom of action, the person performing the service may still be considered an employee. What really matters is that the employer has the legal right to control the method and the result of the services, even though the employer may not always exercise that right. Corporate officers, whether a C Corporation or an S Corporation, who are paid for working for the corporation are considered by the Oregon Department of Revenue to be employees of the corporation and are subject to withholding tax requirement (ORS ) For worker s compensation purposes, one must rely on general guidelines that have evolved in the courts to make the distinction between an employee and an independent contractor. If you have questions, contact the Workers Compensation Division Employer Compliance Unit at Who is an Independent Contractor? In Oregon, workers may only be classified as independent contractors if they meet the provisions of laws and court decisions that define independent contractor and employer-employee relationships. The provisions vary for some agencies, so you should review the Independent Contractor section in the companion publication Employer s Guide for Doing Business in Oregon at pdf and check with agency representatives if you need more information. For some agencies, independent contractors are defined in ORS which includes that an independent contractor must be free from direction and control. For worker s compensation purposes, an independent contractor must be free from direction and control and even free from another s right to direct and control. BOLI and US Department of Labor Definition The Bureau of Labor and Industries (BOLI), and the US Department of Labor, use criteria established through court cases, known as the economic realities test to make determinations on independent contractor status. August

20 Internal Revenue Service Definition The Internal Revenue Service (IRS) uses a 20-factor control test to determine employer control of the Independent Contractor or employee. Please refer to for more information, or call OREGON S MINIMUM WAGE The 2007 minimum wage for Oregon is $7.80 per hour. Oregon s minimum wage is adjusted annually for inflation by the Bureau of Labor and Industries. For more information, contact the Bureau of Labor and Industries (BOLI) at or visit our website at License Requirements CHECK STATE LICENSE REQUIREMENTS The State of Oregon does not have a general business license. However, many occupations and business activities require special licenses, permits, or certifications from state agencies or boards. The State of Oregon now offers a searchable online License Directory, a comprehensive directory of over 1,100 licenses, permits, and certifications. In addition, the Business Information Center s Business Wizard provides information on state and local license requirements based on business activity, and location. These online services are available at: License Directory Business Wizard Local Requirements CHECK LOCAL LICENSE REQUIREMENTS Cities and counties may require a license for businesses operating within their jurisdictions. If your business is located within the city limits, check with your city offices to see if a local business license is required. If there is no specific listing for business licenses in your directory, the city hall information number is an appropriate initial contact. Licensing offices for the following cities are: Eugene Building & Permit Services W 10 th Avenue, Suite 240 Eugene, OR Medford Finance Department W 8 th Street Medford, OR Salem Permit Application Center Liberty Street SE, Room 320 Salem, OR Portland Bureau of Licenses SW Columbia St., Ste. 600 Portland, OR How to Start a Business in Oregon