Guide to Forming an LLC in Nebraska

Follow our free guide to form an LLC in Nebraska

• Pros and Cons of Forming an LLC in Nebraska

• Starting Your Nebraska LLC

• Maintaining Your Nebraska LLC

• Additional Nebraska Resources

The Nebraska LLC formation process includes a series of steps and a fair amount of paperwork. Swyft Filings provides a comprehensive LLC guide that is divided into two phases and walks aspiring business owners through each step of forming your own LLC.

Pros and Cons of Forming an LLC in Nebraska

Pros

No Corporate/Franchise Taxes Nebraska does not impose any corporate or franchise tax on LLCs. The only taxes owed on the LLC’s revenue is the personal income tax paid by the members.

Low Income Tax Rate Nebraska’s state income tax rate is relatively low; the tiered tax rate starts at 2.46% and tops out at 6.84%.

Low Cost of Doing Business Starting and maintaining an LLC in Nebraska is not nearly as costly as other states—after the filing fee, business owners pay a low biennial report fee and low state income taxes since LLCs are not required to pay corporate taxes.

Cons

Less Privacy for Owners Nebraska is among the states that require full disclosure of an LLC’s members in the incorporation paperwork.

Publication Requirement for New Businesses Nebraska is one of only a few states that requires newly formed LLCs to publish a notice of formation in one newspaper for three consecutive weeks. The publication can be chosen by the business owner, but it must be in the same city as the business and must have a general circulation.

Cost of Doing Business

• $100 filing fee (+$5 per page)

• $13 biennial report / $15 publication fee

• No corporate/franchise tax

Phase One: Starting Your Nebraska LLC

Forming an LLC in Nebraska may not seem simple, but you will see that forming a business can be done without a lot of stress when you have the right help. Get started on your Nebraska LLC today with these simple steps:

• Step 1: Name your LLC

• Step 2: Establish Ownership of your LLC

• Step 3: Decide on an Agent for Service of Process

• Step 4: File the Certificate of Organization

• Step 5: Create your Operating Agreement

• Step 6: Register for an EIN

• Step 7: File the Affidavit of Publication

Step 1: Name Your Nebraska LLC

The first thing to so for your Nebraska LLC is to decide on a name. There are state and federal guidelines concerning the use/restriction of certain words in business names.

Tip: Use a free business name search tool to ensure your company’s desired name is available.

Business Name Guidelines

• The official name of your business must end with: Limited Liability Company, Limited Company, LLC, or L.L.C.

• Your business name cannot be intentionally misleading to consumers

• The name of your new LLC must not be similar to another organization’s name/trademark

Restrictions

• “Lottery” and “Bank” are ineligible for use (any state)

• Terms that represent educational or Veterans’ organizations are restricted

• Terms related to the Armed Forces or civil servants (police, EMT, fire)

LLC business names associated with government and/or financial entities are not always restricted—it depends on the state. Additional paperwork may be required.

URL Availability You will also need to select an online address for your LLC’s website—check domain name availability at a number of online web services sites.

Step 2: Establish Ownership

The owners of an LLC are referred to as members and managers. All LLCs will have members, but not every LLC will have managers—the difference in the title depends on the management structure of the business.

LLC Management Structures:

• Member-managed: All members participate in operating and making decisions for the LLC

• Manager-managed: An appointed manager oversees the daily operations of the LLC and the members are usually not actively involved.

Nebraska LLC Member Guidelines

Required Number of Members There must be at least one member or manager to form an LLC in Nebraska.

Member Disclosure Requirements All managers/members of the LLC must be included in the Certificate of Organization.

Age Restrictions LLC members in Nebraska may be of any age.

Residence Restrictions There are no residency restrictions imposed on LLC members in Nebraska.

Step 3: Find an Agent for Service of Process in Nebraska

The agent for service of process is necessary for all businesses in Nebraska. Your LLC cannot officially function without this position.

What is an agent for service of process? An agent for service of process (also known as a registered agent) is a person or business who is authorized to receive government mail and service of process/court notices on behalf of the LLC.

Why do you need an agent for service of process? Nebraska law requires you to appoint an agent for service of process so that there is always a consistent contact person for your LLC.

What are the main requirements for an agent for service of process?

• The agent for service of process must have a physical address — not a P.O. Box

• The agent for service of process must be available during business hours

Who can be an agent for service of process in Nebraska?

• A state resident with a physical address in Nebraska

• An LLC or corporation that is licensed to conduct business in Nebraska

Is the agent for service of process’s contact information publicly accessible? The name and contact information of the LLC’s agent for service of process is a matter of public record.  

Can I be my own agent for service of process for my business? You are legally allowed to be your own agent for service of process as long as you have a physical address in Nebraska.

Is being my own agent for service of process discouraged? Since the agent for service of process’s name and address are publicly listed, LLC business owners who choose to be their own agent for service of process risk compromising their personal information.

Tip: Avoid the hassles and choose Swyft Filings to fill the agent for service of process needs for small businesses in Nebraska. Find more information here.

Step 4: File the Certificate of Organization

The most important step in the LLC formation process if filing the Certificate of Organization with the Secretary of State.

What is the Certificate of Organization? The Certificate of Organization is a legally binding document that is filed with the state government to officially form your LLC.

Why do I need the Certificate of Organization? Your LLC business in Nebraska will not be legally recognized by the Secretary of State without submitting this document. Consider the Certificate of Organization as part of your LLC’s foundation.

What information is included in the Certificate of Organization?

• The name and address of the LLC

• The name of the LLC members/managers

• The name and location of the agent for service of process

• The chosen LLC management structure

• The duration of the LLC

Other Nebraska Filing Information—Professional LLCs

Professional service businesses in Nebraska are also allowed to form LLCs. The general state LLC regulations (including naming guidelines) apply.

Professional Service Business Types:

• Accountants

• Attorneys

• Physicians/Medical Professionals

• Professional Counselors and Psychologists

• Architects and Engineers

• Real Estate Brokers

• Veterinarians

• Social Workers

A few points to consider:

• All members of the LLC must be licensed in the profession of the business.

• The LLC is only allowed to provide services for which the business was formed.

• The members are still subject to whichever licensing boards govern the LLC’s profession.

Step 5: Create an LLC Operating Agreement

An LLC Operating Agreement is considered necessary for the continued success of your Nebraska LLC.

What is an LLC Operating Agreement? The LLC Operating Agreement is a legal document that defines the rights and responsibilities of the owners/members and identifies the business’s overall operating procedures.

Why do I need an LLC Operating Agreement? The LLC Operating Agreement is necessary because it defines the members’ roles and provides structure for the business, protects business assets from creditors, and reduces disputes among members.

Do I need to file the LLC Operating Agreement? You do not need to file the Operating Agreement anywhere; it is for the benefit of your LLC and remains in-house.

What goes into an LLC Operating Agreement? The LLC Operating Agreement is unique to the business; however, most documents include the following information:

• List of the members/managers and their roles

• Designation of authority in the LLC

• Initial capital contributions of the members

• Voting designations and percentages of the members

• Member transfer/addition rules and restrictions

• Distribution of profits

• Meeting schedule

Tip: Get a customized LLC Operating Agreement for your small business with Swyft Filings. Add structure to your LLC now.

Step 6: Register for an EIN

Most businesses formed in Nebraska must register for an EIN. Your Nebraska LLC will not be able to conduct business without this ID.

What is an EIN? The EIN (Employer Identification Number) is a nine-digit number that is assigned to your business by the IRS. Your business’s EIN is similar to a personal Social Security number.

Are all businesses required to have an EIN? Federal law dictates that certain types of business entities register for an EIN:

• Any business with employees (even if owned by one person)

• Any business with more than one member

• A partnership (LLC or C-corp)

Please Note: A sole proprietorship is not required to have an EIN, but it is still recommended.

Why does my LLC business need an EIN? The more common reasons you would need an EIN are:

• To hire employees

• To open a bank account in the U.S.

• To file your company’s taxes

• To pay independent contractors

In short, if you make money through your business and it has employees, you must have an EIN.

Is the EIN publicly listed? The EIN for your LLC will be part of public record.

Can I use my Social Security Number as the EIN? You may elect to use your social security number if you want; however, be aware that your EIN is part of public record.

Swyft Filings offers EIN services for small businesses in Nebraska. Find more information here.

Step 7: File the Affidavit of Publication

Nebraska requires that all newly formed businesses owners publish a notice of business formation in one newspaper for three consecutive weeks.

Information to Publish

• The name and address of the business

• The name and location of the agent for service of process

• The professional services offered (if applicable)

More Publication Facts

• The newspaper must be in the same city as the business

• The newspaper must have a general circulation

• The cost for publication varies (charge is per line)

• The deadline is 45 days from LLC formation

• The Certificate of Publication fee is $15

At the end of the run, the newspaper will send the LLC an Affidavit of Publication that must be submitted to the Secretary of State.

Phase Two: Maintaining Your Nebraska LLC

Now that the initial phase of setting up your Nebraska LLC is complete, you are ready for the next phase that focuses on getting your business ready to operate. The next few steps are:

• Step 1: Register for Taxes in Nebraska

• Step 2: Apply for Permits and Licenses

• Step 3: File the Annual Report

• Step 4: Request a Certificate of Good Standing

Step 1: Register for Nebraska State Taxes

Nebraska does not charge LLCs with a corporate or franchise tax. LLC members are still required to pay state and federal income taxes on their earnings.

State Income Taxes The state income tax rate for Nebraska is on a tiered scale, depending on income, and runs from 2.46% to 6.84%.

Corporate Tax Information You can also choose to have your LLC taxed as a corporation; if so, you will be responsible for paying the corporate income tax rate on your business’s earnings.

Corporate Income Tax

Additional Tax Information Other taxes your LLC may need to pay:

• Sales and Use Tax at 5.5%

• Employee Withholding Tax

• Unemployment Tax

Step 2: Obtain Business Licenses and Permits

The licenses and permits required for an LLC in Nebraska can vary, depending on a number of variables:

• Location (city and county)

• Type of Business

• Industry

Tip: If you would like to see more in-depth information on licenses and permits, please feel free to visit the content in our learning library that covers business licenses and permits.

Step 3: File a Biennial Report

All businesses formed in Nebraska are required to file an annual report with the Secretary of State.

What is an annual report? An annual report, which is also called a periodic report, is a legal form that is filed with the Secretary of State on a periodic basis that is designed to keep your business’s information current with the state.

What kind of information is in the annual report? The information requested in the annual report is similar to what is in the Certificate Of Organization:

• The name and address of the business

• The name and address of the agent for service of process

• The names of the members

• The business’s EIN

Is the annual report part of public record? The annual report filed on behalf of your LLC is a matter of public record.

Fees and Due Date

Fee: $13 Due Date: April 1 (in odd-numbered years) Frequency: Every two years Implications of Late Filings:  LLC dissolution after June 1

Swyft Filings helps you stay compliant by providing stress-free solutions. File your annual report with us today.

Step 4: Request a Certificate of Good Standing

With most of your Nebraska LLC set up and ready to go, your last step is to request a Certificate of Good Standing.

What is a Certificate of Good Standing? The Certificate of Good Standing is a notification that confirms your business is properly formed and is in compliance with all state regulations.

Who issues the Certificate of Good Standing? The Certificate of Good Standing is issued by the Secretary of State.

When can I request a Certificate of Good Standing for my business? Request a Certificate of Good Standing once your LLC is officially set up through the Secretary of State.

Why do I need a Certificate of Good Standing? A Certificate of Good Standing provides proof for banks and other businesses that your LLC is in good standing with the state government.

Please Note: Some states require a Certificate of Good Standing before a business can apply for Foreign Qualification.

Does the Certificate of Good Standing have an expiration date? The Certificate of Good Standing does not expire/does not need to be renewed.

Swyft Filings can create a Certificate of Good Standing for your Nebraska LLC. Click here for more information.

Additional Nebraska Resources

• Nebraska Corporation Guide

• State of Swyft Industry Report