How to Start an LLC in Oregon

Published: May 22, 2025 • Incorporation

🌲 How to Form an Oregon LLC – Complete Guide 2025

Oregon LLC Overview

Oregon Revised Statutes Chapter 63 is the anchor for every limited liability company formed in the state, and it gives founders broad power to define internal governance in an operating agreement rather than through rigid statutory defaults.

ORS 63.130 and the related provisions on contributions and distributions encourage parties to document capital accounts, to state whether management is vested in members or appointed managers, and to lay out how fiduciary duties may be expanded or limited in advance.

Oregon’s courts routinely enforce well-drafted agreements, which means you can design profit-sharing waterfalls, board-style structures, or advisor equity programs without asking the Secretary of State for permission.

Entrepreneurs often select Oregon when their key people, customers, or equipment are located in Portland, Eugene, Bend, or along the I-5 corridor, because physical nexus obligates foreign entities to register anyway.

Local service firms like designers, therapists, and software consultants appreciate the ease of banking with an Oregon charter and the ability to keep everything—registered agent, tax accounts, and record books—within the state.

Retailers and e-commerce companies also value Oregon’s decision to forgo a general sales tax; that policy removes an administrative layer and can be highlighted when pitching investors on the simplicity of the revenue model.

Taxes still matter, and Oregon’s personal income tax has graduated brackets ranging from roughly 4.75 percent to 9.9 percent, so members of pass-through LLCs should plan for quarterly estimated payments even if the federal election remains as a disregarded entity or partnership.

The state’s Corporate Activity Tax overlays the pass-through regime once Oregon commercial activity exceeds one million dollars per year, and the CAT applies regardless of federal classification.

Those costs are predictable and manageable, but they make it clear why founders need a CPA involved as soon as the LLC is active, especially when multiple members or investors expect timely K-1s and Oregon nonresident withholding.

Secretary of State filings are refreshingly simple, and domestic Articles of Organization cost one hundred dollars, amendments are one hundred dollars, and annual reports for domestic LLCs remain a flat one hundred dollars due on the anniversary of formation.

The public Business Registry shows your registry number, registered agent, and principal office, so potential lenders, partners, and agencies can confirm your standing online, which is a major advantage when onboarding vendors or submitting bids.

There is no publication notice like New York or Arizona, and you can file online within minutes, which is a major draw for remote founders coordinating from other states or internationally.

Remote founders appreciate that Oregon allows digital execution of Articles and does not require notarization, so you can coordinate filings from anywhere while still appointing a local registered agent to satisfy service-of-process requirements.

Because Oregon is transparent about corporate records, investors feel comfortable performing quick diligence through the Business Registry, and they will hold you to a high standard when it comes to keeping your registered agent, principal office, and management data current.

🌲 Why Choose Oregon for Your LLC?

No general sales tax: Oregon’s lack of a statewide or local sales tax simplifies pricing, point-of-sale programming, and compliance, especially for retailers who already juggle nationwide tax engines.
Contractual flexibility: The Oregon LLC Act allows multiple membership classes, profits interests, waterfall distributions, and management arrangements that mirror the sophistication of corporate shareholder agreements.
Simple, flat fees: Domestic Articles cost one hundred dollars and annual reports are the same amount, so founders can budget formation and compliance expenses without surprise franchise taxes.
Charging order framework: Judgment creditors are typically limited to charging orders, which entitle the creditor to distributions but not to management control or voting rights.
Local business support: Banks, lenders, and licensing agencies are accustomed to LLCs, so you can open accounts, obtain permits, and enroll in procurement programs with an Oregon-domiciled entity.

🚫 Oregon does not authorize Series LLCs

Oregon does not create domestic series LLCs and does not confer separate legal status on foreign series cells.

If you need discrete liability silos for rental properties or venture investments, you must form multiple traditional LLCs or operate through a parent entity formed in a series-friendly state and then register each cell separately in Oregon.

Banks, insurers, and regulators understand the multi-entity approach and will expect you to use it if you rely on Oregon law, so budget accordingly when structuring real estate portfolios or franchise holdings.

✅ Good Fit for an Oregon LLC

You or your co-founders live in Oregon and will sign leases, hire employees, or maintain inventory in the state, making Oregon the unavoidable home state.
You operate a retail storefront or restaurant that benefits from the absence of sales tax and needs a formal entity for leases, suppliers, and payroll.
You run a professional services practice like design, therapy, or engineering, and your licensing board allows LLC ownership by licensed professionals.
You run an e-commerce brand headquartered in Portland or Tigard, warehouse your products locally, and want Oregon law to apply to your contracts.
You plan to seek Oregon economic development incentives or state procurement contracts that require an Oregon registry number.
You are building a family office or real estate holding company that owns Oregon property and needs clear pass-through taxation for depreciation.
You expect to elect S corporation status for payroll planning once revenue stabilizes and you want to start from an Oregon LLC to simplify the election.
You intend to admit angel investors or advisors using customized profits interests and need a statute that respects complex operating agreements.
You are coordinating with Oregon banks, lawyers, and accountants who already use the Business Registry and prefer local filings.
You want a low-drama Secretary of State that processes filings quickly without hidden franchise assessments or publication rules.
You plan to own Oregon real estate in a pass-through vehicle to take advantage of local property markets while insulating personal assets.
You want to consolidate multiple sole proprietorships into one structured entity for liability protection and easier tax reporting.

⚠️ Consider Another State If…

You want to avoid state income tax entirely, in which case Wyoming, Texas, or Florida may serve you better.
You prioritize maximum anonymity and prefer jurisdictions such as New Mexico where member names are not placed on the public record.
You require statutory series LLC flexibility, which Oregon does not provide; Delaware, Nevada, Utah, or Tennessee may better support that structure.
You expect institutional capital that insists on a Delaware entity and is comfortable qualifying you into Oregon as a foreign LLC.
You conduct business exclusively outside Oregon and have no nexus; filing in Oregon would merely add another compliance obligation.
You seek the cheapest possible annual maintenance and do not need an Oregon presence, making Wyoming’s fifty-dollar annual fee more attractive.
You prefer a state with strong anonymity or asset protection statutes designed for holding companies, like Nevada or Wyoming.
You operate a multi-state logistics company whose clients are clustered elsewhere; forming in Oregon could add an unnecessary filing.
You need statutory conversion features unique to Delaware public benefit companies or corporate share structures.
You already run an entity in another state and adding Oregon would mean duplicating reports without operational benefit.
You want to experiment with series LLC asset segregation or cell-based joint ventures that Oregon cannot accommodate.
You are launching a national holding company with no employees or assets in Oregon and want to keep filings centralized elsewhere.

“The absence of sales tax reduced our compliance burden dramatically, but we still needed an attorney-led operating agreement to keep our multi-member Oregon LLC aligned with investor expectations. Having everything under one state’s law has been a huge relief.” – Founder of a Portland retail collective

Formation Steps

Oregon’s filing process is straightforward, yet the most successful founders treat every step as an intentional project. The checklist below mirrors how I run engagements for clients: it combines statutory requirements, Secretary of State mechanics, and practical law-office advice gathered from hundreds of Oregon formations. Each step contains narrative explanations, sub-steps, and contextual examples so you can build a company that investors, lenders, and regulators will respect.

1Decide if Oregon should be your home state

Before drafting anything, analyze where your LLC will actually operate. Oregon defines “transacting business” broadly enough that any LLC with an office, employees, or inventory in the state must register. If you form in Delaware, Wyoming, or Nevada but keep your headquarters in Portland, you will still file an Application for Authority with the Oregon Secretary of State, pay the foreign filing fee, and maintain an Oregon registered agent. The “Delaware + Oregon” approach is common for venture-backed companies, yet it doubles your annual reports.

Ask yourself where your customers sit, where your contracts are negotiated, and which state’s laws you want to govern disputes. Oregon is the natural home for brick-and-mortar stores, professional practices, and service companies whose leadership team lives here. Forming locally also makes it easier to open bank accounts, register for city business licenses, and qualify for Oregon-specific incentives. If you truly operate elsewhere and only drop-ship into Oregon, stick with your home state and avoid the duplicate filings. When in doubt, assume Oregon expects you to show up on its registry the moment you hire anyone in-state.

Foreign qualification carries the same annual renewal requirements as a domestic entity, so forming elsewhere rarely saves money when your operations are Oregon-based.
If institutional investors demand a Delaware entity, consider structuring an Oregon LLC subsidiary that handles local operations while the Delaware parent raises capital.
Document your reasoning; investors may ask why you selected Oregon versus another jurisdiction, and having a memo ready demonstrates strategic thinking.

2Choose and clear your Oregon LLC name

Every Oregon LLC name must include “Limited Liability Company,” “LLC,” or “L.L.C.” and must be distinguishable from existing records. Distinguishable means more than punctuation or articles; “Willamette Advisors LLC” and “Willamette Advisors L.L.C.” are considered the same. Visit the Oregon Business Registry search page and explore multiple variations, including abbreviations and hyphenated versions. If the names you love are clustered around common words like “Cascade” or “Rose City,” brainstorm unique modifiers so your filing is accepted on the first attempt.

Once you find an available name, decide if you need to reserve it. Reservation is smart when you are coordinating multiple members, awaiting investor funds, or waiting on licensing board approval because it locks the name for 120 days. Submit the Name Reservation form online or by mail and pay the reservation fee. During this stage, run trademark searches (state and federal), secure the domain name, and check social media handles. The Secretary of State does not police trademarks, so you want to know whether your brand conflicts with an existing mark before investing in signage or marketing materials.

Pay attention to restricted and regulated words. Terms like “bank,” “architect,” “engineer,” “insurance,” “trust,” or “cooperative” may require supporting documentation or approval from the relevant regulatory agency. Professional boards frequently require the profession to be spelled out (e.g., “Psychology LLC”), and some boards require owner names in the entity title. Review the board’s naming rules in advance to avoid rejection.

If you plan to use a trade name different from the legal LLC name, register an Assumed Business Name (DBA) with the Secretary of State to preserve brand consistency.
Keep a naming log that records every variation you checked and the date; this becomes helpful if a competitor later claims your name is confusingly similar.
Consider future expansion: choose a name that still makes sense if you add new product lines or open locations outside the original city.

3Appoint an Oregon registered agent

Oregon requires every LLC to maintain a registered agent with a physical street address in the state and availability during normal business hours. The agent’s address becomes a matter of public record, so think carefully before listing your home. The registered agent can be an individual resident, a domestic business entity, or a foreign entity authorized to do business in Oregon. The LLC cannot designate itself as its own agent, but a member or manager may serve.

Evaluate the privacy, reliability, and logistical needs of your company. A solo consultant with a downtown office might act as their own agent, while an e-commerce founder living outside Oregon must hire a commercial agent immediately. Some clients prefer to have their attorney or CPA listed as the agent so that legal notices automatically reach the advisory team. When comparing commercial agents, look for those with Oregon-based staff rather than mail-forwarding operations, and confirm how they notify you (email, portal, phone) when documents arrive. Registered agent failures are a leading cause of default judgments; never treat this as a throwaway decision.

Self-appointment: Free, but you accept the risk of sheriff’s deputies or process servers appearing at your residence or place of business.
Commercial agent: Typically $75–$150 annually, including document scanning, compliance reminders, and in some cases, limited corporate secretary services.
Professional advisor: Attorneys and CPAs may offer agent services as part of a bundled package, which keeps all compliance communications in one place.

4Draft the Oregon Articles of Organization

Use ORS 63.047 as your checklist for Article content. You need the LLC name, registered agent name, registered office street address, mailing address (if different), and principal office information. You must also state whether the LLC is member-managed or manager-managed, as banks will look to that designation when determining who can sign on behalf of the company. Include at least one organizer’s name and address; an organizer can be a member, manager, attorney, or any individual authorized to submit the filing.

Consider optional provisions that might support your business plan. Examples include a delayed effective date (often used when transactions close on the first day of a month), a narrow business purpose for industries that require it, or clauses limiting manager authority without written member approval. If you intend to issue multiple membership classes or impose transfer restrictions, note in the Articles that the operating agreement contains detailed provisions. The Business Registry accepts attachments, so you can include customized language beyond the standard form.

Think about how your management structure will operate in real life. A family rental LLC may remain member-managed so each owner can sign leases and vendor contracts, whereas a tech startup might appoint a manager or executive board to centralize decision-making authority. Identify those managers by title (e.g., “Managing Member,” “Chief Executive Manager”) to avoid confusion later.

Do not list more member information than necessary on the Articles; keep sensitive ownership percentages inside the operating agreement.
If you are filing on behalf of a professional practice, confirm whether the licensing board requires specific statements in the Articles.
Retain a signed copy of the Articles and any attachments, as banks and investors often ask for them before releasing funds.

5File the Articles with the Oregon Secretary of State

Once the Articles are finalized, submit them online for the fastest processing. The online Business Registry guides you through each field, prompts you for payment, and generates a registry number immediately upon acceptance. The filing fee for a domestic LLC is one hundred dollars. If you prefer paper, mail the completed form with payment and expect processing within one to two weeks depending on workload. Foreign LLCs use the Application for Authority and pay two hundred seventy-five dollars.

Before clicking “Submit,” pause for a final review. Confirm spelling, addresses, management selections, and organizer details. Save or print the confirmation screen and download the stamped Articles for your permanent records—banks, landlords, and licensing agencies often ask for this proof. Oregon emails renewal notices to the addresses listed in the filing, so make sure those inboxes are monitored. If you are filing close to the end of the calendar year and want the LLC effective on January 1, use the delayed effective date option to avoid partial-year tax filings.

What to have ready before you file

Name search results or reservation number.
Registered agent acceptance and physical street address.
Principal office mailing address, even if it is a coworking space or mail service.
Management selection (member-managed vs manager-managed) and names of managers if you want them on record.
Organizer’s name, address, and authority to sign.
Credit/debit card for online payment or check for paper filings.

6Get an EIN and handle federal/tax setup

After filing, request an EIN from the IRS using the online application (available Monday through Friday). The system issues the number immediately and provides a confirmation letter; save the PDF because banks and payroll providers will request it. The default federal classification is disregarded for single-member LLCs and partnership for multi-member LLCs. Talk to your CPA about whether and when to elect S corporation status via Form 2553; many Oregon founders switch once net income supports reasonable salaries.

Use this stage to register for Oregon tax accounts. If you will have employees, file for withholding and unemployment insurance accounts through the Oregon Department of Revenue and the Employment Department. Evaluate whether you will trigger the Corporate Activity Tax in year one, and if so, learn how to compute the 0.57 percent tax on commercial activity above one million dollars. Discuss the Pass-Through Entity Elective (PTE-E) tax with your CPA, as it can provide federal SALT cap relief for qualifying members. Build a shared folder that holds your EIN confirmation, tax registrations, and any election forms so the entire leadership team can access them.

Schedule a CPA meeting to design quarterly estimated payments for both federal and Oregon income taxes; catching up later is expensive.
Decide whether to use payroll software immediately or wait until employees are hired; Oregon’s Paid Leave Oregon program applies even to small employers.
Create a simple capitalization table that tracks cash contributions, sweat equity, and any promissory notes exchanged at formation.

7Local licenses, bank accounts, and record-keeping

Licensing and local registrations vary by city and industry. Portland and Multnomah County require business license tax registrations and combined tax filings; Eugene, Salem, and Bend have their own licensing systems. Restaurants, food carts, contractors, alcohol vendors, and cannabis businesses deal with additional state agencies such as the Oregon Health Authority, OLCC, and Construction Contractors Board. Investigate zoning rules, signage permits, and fire inspections early so you do not delay your opening.

Open a separate business bank account to preserve liability protection and simplify bookkeeping. Most banks ask for the Articles, EIN letter, operating agreement, and a banking resolution authorizing signers. Establish accounting software or hire a bookkeeper immediately, even if transaction volume is low, because clean books make tax filings and financing easier. Store your Articles, operating agreement, EIN letter, initial resolutions, and major contracts in a secure cloud folder with backups.

Document major decisions with written consents or meeting minutes, even if the LLC has one member. Oregon does not mandate annual meetings, but minutes demonstrate that you treat the LLC as a separate legal person. Set calendar reminders for recurring obligations such as annual reports, tax filings, license renewals, and insurance audits. A disciplined compliance calendar is one of the easiest ways to impress investors, regulators, and lenders.

Create an onboarding checklist for new members or managers so ownership changes are documented, tax forms are collected, and voting rights are updated.
Review your insurance portfolio (general liability, professional liability, cyber, auto) and align coverage with your operating agreement’s indemnification provisions.
Build a disaster recovery plan that outlines how you access banking, customer data, and compliance documents if your primary systems fail.

Costs & Fees

Cash planning is a hallmark of sophisticated LLC formation. Oregon’s statutory fees are predictable, but you will still incur legal, accounting, and operational costs as soon as you launch. Use the tables and narrative below to design a realistic budget for both the first-year ramp and ongoing operations.

One-Time Formation Costs

Expense	Amount	Notes
Articles of Organization	$100	Required payment to the Oregon Secretary of State for every domestic LLC.
Name Reservation (optional)	$100	Locks a name for 120 days while you finalize investors, licensing, or documentation.
Assumed Business Name (DBA)	$50	Needed if you want to market under a trade name different from the LLC’s legal name.
Operating Agreement Drafting	$750–$2,500+	Attorney fees vary based on number of members, investor expectations, and tax allocations.
Registered Agent Service	$75–$150	Commercial agent annual fee if you do not serve personally.
CPA Strategy Session	$300–$800	Helps model estimated taxes, PTE-E elections, and CAT exposure.
Local Licenses & Permits	$35–$500+	City business licenses, home occupation permits, health inspections, etc.
Initial Insurance Premiums	$400–$3,000+	General liability or professional liability policies often require deposits at launch.

Ongoing Costs

Expense	Amount	Notes
Annual Report (Domestic LLC)	$100	Due each year on your formation anniversary; pay online for immediate confirmation.
Annual Renewal (Foreign LLC)	$275	Applies to LLCs formed elsewhere but authorized in Oregon.
Registered Agent Renewal	$75–$150	Pay annually to keep your commercial agent on file.
Bookkeeping / Accounting	$600–$3,000+	Depends on transaction volume, payroll, and whether you use an outside firm.
Corporate Activity Tax Payments	Variable	Due quarterly once Oregon commercial activity exceeds $1M.
CPA / Tax Preparation	$750–$5,000+	Partnership returns, PTE-E filings, and CAT reports add complexity.
Payroll Service	$480–$1,500+	Ongoing if you run payroll for owners or employees.
Insurance Renewals	Variable	General liability, professional liability, cyber, workers’ comp, auto, etc.

Hidden Costs to Watch For

Missing the annual report triggers late fees and administrative dissolution, which requires additional filings and harms credibility with lenders.
Portland and Multnomah County impose business income taxes and the Clean Energy Surcharge; you may owe these long before hitting the CAT threshold.
Insurance premiums often require annual audits; underestimating payroll or sales can lead to large true-up bills.
Professional license renewals and continuing education costs can rival filing fees for lawyers, medical providers, and engineers.
Expansion into other states brings additional registered agents, foreign filings, and tax accounts, so keep your entity footprint as lean as possible.

Build a first-year budget that includes formation expenses, legal drafting, initial professional fees, and at least six months of operating expenses. Revisit the budget quarterly, adjusting for growth, licensing, or tax developments. Treat compliance costs like payroll—non-negotiable obligations that preserve your limited liability status.

Operating Agreement Strategy

The operating agreement transforms your bare-bones Articles into a living governance manual. Even though Oregon does not require you to file the agreement with the state, it expects members to rely on contractual terms to allocate power, profits, and duties. Banks, investors, and litigators will all demand to see this document, so invest the time to craft it thoughtfully.

Single-Member LLCs

Single-member LLCs need agreements for three reasons: to document separateness, to plan for incapacity or death, and to provide clarity for heirs or successors. Your agreement should reference the initial capital contribution, state whether profits may be distributed at any time, and authorize the member to appoint officers or managers as needed. Include a clause that allows the member to transfer the interest to a revocable trust or to a successor designated in a will. Document major decisions—like signing a lease or buying equipment—with written consents so you can prove the LLC observed formalities if creditors ever attempt to pierce the veil.

Multi-Member LLCs

When more than one owner is involved, the agreement becomes a constitution. Spell out voting percentages, supermajority requirements, and veto rights for key decisions (admitting new members, borrowing money, selling the company). Outline capital contribution obligations, default remedies for members who fail to fund, and mechanisms for raising additional capital (bonus units, convertible notes, SAFEs). Provide detailed buy-sell triggers for death, disability, bankruptcy, divorce, or termination, and define valuation methods (appraisal, formula, or capital account). Address tax matters such as the partnership representative, tax distributions, and whether the LLC will make the PTE-E election.

Clause Checklist

Purpose and powers: Confirm the LLC can engage in any lawful business unless limited, and reference ORS 63.077 for general powers.
Capital contributions: Describe contributions (cash, IP, services), acceptance procedure, and consequences for failure to deliver.
Profit and loss allocations: Explain allocations, priority returns, and tax distribution policies to cover member tax liabilities.
Management: Clarify decision rights, meeting procedures, written consent mechanics, and replacement of managers.
Transfer restrictions: Outline voluntary transfers, right of first refusal, drag-along, tag-along, and conditions for involuntary transfers.
Buy-sell provisions: Include triggers, valuation methods, payment terms, and security interests securing promissory notes.
Indemnification and limitation of liability: Adopt language consistent with ORS 63.160 to protect managers and members acting in good faith.
Dispute resolution: Decide on mediation, arbitration, or exclusive venue in Oregon courts, and include attorney-fee provisions.
Books and records: Detail reporting frequency, delivery of financials, member inspection rights, and digital record policies.

Oregon Nuances

Charging orders are the exclusive remedy for creditors, so you can safely differentiate between voting and non-voting interests.
Oregon allows special allocations if they have substantial economic effect; keep capital accounts accurate to support these structures.
You may tailor fiduciary duties, but do not eliminate the implied covenant of good faith and fair dealing; courts will still enforce that baseline.

Keep your operating agreement updated. Amend it when ownership changes, when you admit new managers, or when you elect S corporation status. Store signed copies (PDF and hardcopy) in a safe location and provide excerpts to banks or partners as needed. Treat it as a living document, not a one-time PDF that collects dust.

Professional LLCs in Oregon

Oregon allows many licensed professionals to operate through LLCs so long as the licensing boards permit it. The state does not maintain a separate “PLLC” statute; instead, the professional’s board dictates ownership and management requirements. Lawyers, doctors, chiropractors, architects, engineers, counselors, and accountants routinely use LLCs or a combination of LLCs and professional corporations to manage risk and isolate assets.

Understand your board’s rules before filing. Some boards require that the LLC name include the professional designation (“Psychology,” “Engineering,” “Dental”). Others mandate that all members be licensed in the profession or that non-licensed investors hold only non-voting units. Boards may also require filings beyond the Secretary of State, such as registering the LLC with the Oregon Medical Board or submitting shareholder agreements to the Oregon State Bar.

Remember that an LLC protects against business-level liabilities—leases, vendor contracts, loans—but it does not shield an individual professional from malpractice claims arising from their own services. Maintain professional liability insurance, use engagement letters that clearly identify the LLC as the contracting entity, and implement quality-control procedures. Many practices pair the LLC with a professional corporation or LLP to segregate clinical services from administrative operations.

Example Structures

Solo therapist in Portland: Forms “Rainier Therapy LLC,” registers the business name with the Board of Licensed Professional Counselors, uses the LLC to hire administrative staff, and maintains malpractice insurance in the individual’s name.
Dentists with multiple locations: Form a professional corporation for clinical work and a separate LLC to own equipment, pay staff, and hold leases. The entities sign management agreements and allocate revenue between them.
Engineering firm: Forms an LLC with only licensed engineers as members, secures a Certificate of Authorization from the Oregon State Board of Examiners for Engineering, and uses the LLC to bid on public projects.

Stay ahead of compliance. Update the board when ownership changes, file annual license renewals, and document continuing education. When adding partners, ensure the operating agreement addresses what happens if a member loses their license—most boards expect mandatory buyouts of disqualified owners within a set period. Coordinate with malpractice insurers to confirm entity structures are covered.

Tax Landscape

Tax planning is inseparable from LLC strategy. Pass-through entities provide flexibility, but Oregon’s income tax, CAT regime, and local taxes require a proactive plan. Use the subsections below to understand the moving pieces before revenue starts flowing.

Federal Treatment

Single-member LLCs are disregarded by default and report income on Schedule C, E, or F. Multi-member LLCs default to partnership status and file Form 1065, distributing Schedule K-1s to members. You may elect S corporation status using Form 2553 to reduce self-employment tax by paying yourself reasonable salary and taking the rest as distributions; this strategy makes sense when net profit exceeds what you would pay yourself as wages. Alternatively, some capital-intensive businesses elect C corporation status for Qualified Small Business Stock (QSBS) planning.

Each election changes payroll, accounting, and tax compliance. S corporations require payroll, officer compensation, and additional IRS filings; C corporations face double taxation. Consult a CPA before filing elections and model multiple years of cash flow so you know when the savings exceed the cost.

Oregon Personal Income Tax

Oregon taxes individuals on their share of pass-through income at graduated rates from 4.75 percent up to 9.9 percent. Members receive K-1s or report Schedule C income and must pay quarterly estimated taxes (April, June, September, January). If you have nonresident members, Oregon requires withholding or composite returns for their share of Oregon-source income. Build tax distributions into your operating agreement so members have cash to pay their liabilities.

Corporate Activity Tax (CAT)

The CAT applies when Oregon commercial activity exceeds one million dollars in a calendar year. The tax equals $250 plus 0.57 percent of Oregon commercial activity over $1M, less a subtraction equal to 35 percent of the greater of Oregon-apportioned labor or cost inputs. Example: if your Oregon commercial activity is $2.5M and your subtraction amount is $600K, the CAT is $250 + 0.57% of ($2.5M – $1M – $600K) = $250 + $5,130 = $5,380. Register for CAT once you expect to exceed the threshold and make quarterly estimated payments to avoid interest.

Because CAT is based on gross receipts, even low-margin companies can owe tax. Manufacturers, wholesalers, and retailers should track Oregon receipts monthly so they know when the threshold is approaching. Keep documentation supporting your subtraction calculations; the Department of Revenue can request them during audits.

Pass-Through Entity Elective (PTE-E) Tax

The PTE-E tax allows S corporations and partnerships to pay an entity-level tax and give members a credit, effectively bypassing the federal SALT deduction cap. Elections are made annually with the first quarter payment and are generally advantageous when members exceed the $10K federal SALT deduction limit. The rate is 9 percent on the first $250K of distributive proceeds and 9.9 percent above that. Work with your CPA to determine whether PTE-E saves money when combined with CAT and personal taxes.

Local Taxes and Sector Overlays

Portland and Multnomah County administer the Business License Tax (a net income tax) and the Preschool for All income tax. The City of Portland imposes a Clean Energy Surcharge on large retailers. Lodging taxes apply to hotels and short-term rentals; alcohol and cannabis businesses have their own excise taxes. Research local obligations for every city where you operate, because they can significantly increase your effective tax rate.

Tax Snapshot: Oregon vs Other States

Oregon has no general sales tax, unlike neighboring Washington (which also imposes a B&O tax) and California.
Oregon’s personal income tax rates are higher than Wyoming, Texas, or Florida, so pass-through owners must budget for larger estimated payments.
The Corporate Activity Tax adds a gross-receipts element, similar to Washington’s B&O tax but with a deduction for labor or cost inputs.

Tax planning is iterative. Schedule quarterly calls with your CPA, update cash forecasts, and revisit entity classification whenever profits or ownership change. Oregon rewards disciplined record keeping and penalizes surprise filings, so keep your financials current.

Annual Requirements

Oregon keeps annual compliance light, but missing deadlines causes cascading problems. Administrative dissolution can nullify contracts, block bank transactions, and trigger default clauses. Treat compliance like payroll: it happens on time, every time.

Annual Report Filing

Your annual report is due every year on the anniversary of your LLC’s formation. The Secretary of State emails reminders to the addresses on file, but do not rely solely on those messages—set recurring calendar reminders. The report confirms your registered agent, principal office, and member/manager information, and the fee is one hundred dollars for domestic LLCs or two hundred seventy-five dollars for foreign LLCs. File online to receive immediate confirmation and keep the receipt with your records.

If you miss the deadline, late fees accrue and the state may administratively dissolve the LLC. Reinstatement requires filing all past-due reports, paying fees, and completing reinstatement paperwork. During dissolution, you cannot legally transact business and banks may freeze accounts. Avoid this scenario by tracking due dates in multiple systems.

Ongoing Compliance Checklist

Registered agent: Maintain a valid agent at all times. If your agent resigns, appoint a replacement immediately or your entity will fall out of good standing.
Books and records: Keep copies of Articles, operating agreements, amendments, tax returns, financial statements, contracts, and meeting minutes. Oregon members have inspection rights under ORS 63.771, so be ready to supply documents.
Employment compliance: Stay current on payroll taxes, Paid Leave Oregon contributions, workers’ compensation, and unemployment insurance. Notify agencies when payroll or headcount changes significantly.
Licenses and permits: Renew city business licenses, health permits, contractor licenses, OLCC licenses, or professional licenses on time. Many agencies send only one reminder.
Insurance: Review coverage annually, update certificates for landlords and clients, and budget for audits and premium adjustments.

Oregon LLC Compliance Calendar

January: Issue W-2s/1099s, reconcile payroll, refresh operating agreement signatories if managers changed.
March/April: File federal and Oregon tax returns or extensions; make PTE-E and CAT payments if applicable.
Quarterly: Pay estimated federal, Oregon, CAT, and local business taxes. Review financial statements and compliance checklists.
Anniversary month: File the Oregon annual report and verify registered agent information.
Throughout the year: Renew professional licenses, city permits, OLCC or OHA approvals, and insurance policies.

Adopt a culture of documentation. Even single-member LLCs should memorialize major decisions with written consents. Multi-member LLCs should conduct at least one formal meeting per year—virtual is fine—to review financials, vote on major decisions, and confirm compliance status. These habits demonstrate that the LLC is an independent entity worthy of liability protection.

Foreign LLC Registration

LLCs formed outside Oregon must register before “transacting business” in the state, and the definition favors registration whenever you have a continuous presence. Filing early avoids fines and keeps you eligible for courts and contracts.

When Registration Is Required

Typical triggers include maintaining an office, showroom, warehouse, or other physical facility; employing people in Oregon; holding real estate for income; regularly performing services within the state; or significant in-person sales activity. Activities that generally do not require registration include owning passive investments, holding isolated transactions, or conducting interstate commerce without a physical presence. When in doubt, register—the process is inexpensive relative to the penalties for noncompliance.

Application for Authority Process

File the Application for Authority online or by mail, appoint an Oregon registered agent, and provide a certificate of existence/good standing from your formation state dated within sixty days. Pay the $275 filing fee. Once accepted, the foreign LLC receives an Oregon registry number and must file annual renewals just like a domestic entity. Update the Secretary of State whenever your registered agent or principal office changes.

Common Scenarios

Out-of-state e-commerce company hiring Oregon staff: The moment you hire employees in Oregon, register the LLC so payroll and workers’ compensation comply with state law.
Delaware startup opening a Portland office: Register the Delaware entity to transact in Oregon and maintain both states’ filings.
Real estate investor buying Oregon property: Register before recording deeds or signing leases so the county accepts your documents.

Remember to withdraw when you leave the state. File a Certificate of Withdrawal after closing operations and ensure all tax accounts are settled. Failing to withdraw leaves you liable for future annual fees and registered agent costs.

State Comparison

Founders often weigh Oregon against other jurisdictions. The table summarizes cost and policy differences, followed by narrative guidance on when to expand beyond Oregon.

State	Formation Fee	Annual Report	Income Tax	Sales Tax	Series LLC?	Privacy	Best Fit
Oregon	$100	$100 (domestic)	4.75%–9.9% personal rates	No	No	Member names public	Businesses with Oregon operations, retailers leveraging no sales tax.
Delaware	$90	$300 franchise tax	No tax on out-of-state owners	Yes	Yes	Manager names optional	Venture-backed companies and holding companies seeking Court of Chancery.
Wyoming	$100	$60 annual license tax	No income tax	Yes	No	High privacy	Asset protection entities for owners without Oregon nexus.
Nevada	$425+	$350 list + $200 license	No income tax	Yes	No	Moderate privacy	Companies needing a zero-income-tax state and willing to pay higher fees.
Washington	$200	$60	No income tax but B&O tax	Yes	No	Member names public	Firms operating primarily in Washington with local clientele.
California	$70	$800 min franchise + filings	1%–12.3% personal rates	Yes	No	Member names public	Companies headquartered in California despite higher costs.

Stick with Oregon if you live here, employ people here, or own property here; you will need an Oregon registration regardless. Consider forming elsewhere only when investors require a Delaware entity, when you have no Oregon nexus, or when you are building a pure holding company that owns out-of-state assets. Remember that multi-state operations multiply costs: two registered agents, two annual reports, two tax regimes. Keep structures as simple as possible until scale demands otherwise.

Attorney-Led Services

I am a corporate and technology attorney working with Oregon founders and remote clients who need an Oregon presence. Engagements are handled personally via Zoom, secure portals, and detailed checklists. You get legal strategy, filings, and compliance infrastructure tailored to Oregon law.

Starter

$500

Articles of Organization filed with the Oregon Secretary of State plus status monitoring.
EIN acquisition and a streamlined single-member operating agreement aligned with ORS Chapter 63.
Compliance checklist covering annual reports, CAT triggers, and local licensing basics.
Email support for quick questions during the 14-day onboarding window.

Standard

$750

Customized multi-member operating agreement with capital schedules, buy-sell planning, and tax distribution language.
EIN, initial resolutions, and banking packet plus two revisions during the drafting cycle.
30-minute strategy consultation covering tax elections, licensing, and registered agent coordination.
Compliance calendar and document vault template for ongoing record keeping.

Advanced

$850

Attorney-led formation for complex structures with multiple owners, investors, or foreign registrations.
Advanced operating agreement with governance boards, vesting, waterfalls, or advisor units.
One-hour consultation covering CAT modeling, PTE-E elections, and multi-entity coordination.
Up to five revisions plus 30 days of post-closing support as you roll out banking and licensing.

Email owner@terms.law with your goals, industry, and timeline. Include prior filings or draft agreements if you have them. I respond within one business day with scope, pricing confirmation, and the onboarding process.