Business Formation in OR and WA

Business & Commercial Law

What Does It Take to Form a Business in Oregon or Washington?

From a legal perspective, forming a business in Washington or Oregon can be simple. Each process begins with the applicable Secretary of State. Fortunately, both Oregon and Washington’s Secretaries of State have websites that simplify the formation process. Individuals can create an account on the Secretary of State’s website and then submit their application via the online portal. The application will ask question such as the business name, address, owner information, and purpose. It will also ask for the contact information of the company’s registered agent, which is a person or entity authorized to receive service of legal documents in the state where the business is formed. Many businesses use the owners’ own addresses to receive legal documents, but there are also professional organizations equipped to act as registered agents. The fee to file an application is $200 in Washington and $100 in Oregon for most businesses. Typically, applications are approved within a matter of days, but may take longer depending on the volume of applications.

What Else is Required When Forming a Business?

We recommend all companies check the Secretary of State, search the U.S. Patent and Trademark Office, and conduct basic online searches to ensure that the chosen business name does not already exist. This is to avoid any trademark issues that could lead to civil lawsuits. The Secretary of State will likely not reject an application for a business with the same name as another entity, especially if that entity is out of state. However, even out-of-state companies can pose a risk of trademark litigation.

All businesses should keep business and personal finances separate. Thus, an important first step after business formation is to apply for an employee identification number (“EIN”) with the IRS. With the EIN, most businesses should be able to open a business checking account with a local bank. Keeping your finances separate, paying for business essentials, and paying salaries properly can be tricky. An attorney specializing in business law can help figure out these key details. A good bookkeeper or accountant is also strongly recommended.

Can I Begin Working Right Away?

Whether a business can begin operating immediately depends on a number of different regulatory factors. Many businesses require some kind of licensing or permitting. New Washington businesses, for example, will need to apply for a business license in most locations. This can be done via registering an online account with the Washington Department of Revenue. After registration, businesses can submit business license applications for most counties and pay the required fee. The fee amount may vary depending on the type of license and number of business locations. Oregon businesses and certain Washington businesses may need to contact their local municipality to apply for such a license. Additionally, some businesses may require independent licensing with various regulatory agencies.