How to Start a Business in Oregon: Formation, Taxes, and Licenses

To start a business in Oregon, you choose a legal structure, file formation documents with the Secretary of State’s Corporation Division for a $100 fee, get a federal Employer Identification Number from the IRS, register for the state tax and payroll accounts that apply to your situation, and secure any industry or local licenses you need before opening your doors. Online formation filings typically clear in one to three business days. The steps below walk through each piece in the order you’ll run into it.

Pick a Legal Structure

Your structure decides how you’re taxed, how much personal liability you carry, and how much ongoing paperwork you deal with. Most new Oregon businesses form as a limited liability company or a corporation, though sole proprietorships, partnerships, and cooperatives are also on the table.

Oregon LLCs are governed by ORS Chapter 63; corporations fall under ORS Chapter 60.¹² An LLC gives you flexible management and pass-through taxation: the business doesn’t pay Oregon income tax itself, and profits flow to your personal return. A C-corporation pays Oregon’s corporate excise tax on its own income. An S-corporation passes income through to shareholders but still owes the $150 minimum excise tax each year.³ Both LLCs and corporations shield your personal assets from business debts, but corporations come with a more rigid framework: required officers, directors, and shareholder meetings.

Choose and Clear a Business Name

Your name has to be distinguishable from every other active entity in the Secretary of State’s business registry. Oregon’s Business Name Availability Check compares the main words of your proposed name against active filings, and anything too close gets rejected.⁴ Run that search before you spend money on a logo, a sign, or a domain.

If you want to lock in a name before filing your formation documents, you can reserve it with the Secretary of State for a limited period. One caveat worth knowing: clearing the Oregon registry doesn’t clear you against federal trademarks. A company in another state could already own the mark even if no Oregon business has filed under that name.

Operating Under a Different Name

If you plan to do business under a name different from your official entity name, Oregon requires you to register an assumed business name, commonly called a DBA. The requirement applies in every county where the business operates, has a physical location, or stations an employee.⁵ The fee is $50, and the registration renews every two years.⁶

Appoint a Registered Agent

Every Oregon entity must designate a registered agent to accept lawsuits, government notices, and other legal documents. The agent needs a physical street address in Oregon and has to be available during normal business hours. PO boxes and mail-forwarding services don’t qualify.⁷

You can be your own registered agent if you have an Oregon street address. You can also hire a commercial service, which means you don’t have to be at the address all day and lawsuit paperwork won’t arrive at your storefront in front of customers.

File Your Formation Documents

LLCs file Articles of Organization. Corporations file Articles of Incorporation. Both go to the Oregon Secretary of State’s Corporation Division. The articles ask for the entity name, the registered agent’s name and address, the names of the organizers or incorporators, and whether the entity will exist perpetually or dissolve on a set date.¹

File online through the Oregon Business Registry portal or mail paper forms to the Corporation Division in Salem. Online filings typically process in one to three business days; mail takes longer depending on backlog.⁸ The filing fee is $100 for a domestic LLC, corporation, limited partnership, or business trust, and it’s nonrefundable even if the filing is rejected.⁹

Once approved, you get a confirmation with your business registry number. That number is your unique identifier for every future state interaction, and your bank will ask for it when you open a business account.

Get a Federal EIN

Almost every business needs a federal Employer Identification Number from the IRS. The nine-digit EIN functions as your business tax ID. You’ll use it on tax returns, for bank accounts, and when hiring employees. The IRS issues EINs for free through an online application that takes about ten minutes, and you receive the number immediately on approval.¹⁰ Ignore any third-party site that offers to get you an EIN for a fee. The IRS never charges.

Put Your Internal Governance in Writing

Formation documents make you legal. Governance documents tell your business how to actually run. Oregon doesn’t require you to file either with any agency, but you need them in place from the start.

For a corporation, Oregon law requires the incorporators or initial board to adopt bylaws covering how directors are elected, how meetings are called, and how decisions get made.² For an LLC, the equivalent is an operating agreement. Oregon allows operating agreements to be written or oral, but an oral agreement is a problem waiting to surface.¹ A written one should cover how profits are split, how new members are admitted, and what happens if a member leaves. The LLC must keep any written operating agreement at its registered office or another location named in the agreement itself.

Register for the Taxes That Apply

Oregon has no general sales or use tax, so you won’t collect sales tax on in-state transactions.¹¹ If you sell online into states that do tax sales, you may still need to collect and remit tax to those states once you cross their economic nexus thresholds.

The Corporate Activity Tax applies to almost all business types, not just corporations. Any business with Oregon commercial activity of $750,000 or more must register for the CAT, and businesses above $1 million must file a return. The tax is $250 plus 0.57 percent of taxable commercial activity above $1 million.¹² Commercial activity is defined broadly from gross receipts, so a thin-margin business can still owe CAT if top-line revenue is high.

The corporate excise tax hits C-corporations at 6.6 percent on Oregon taxable income up to $1 million and 7.6 percent above that. Even a C-corporation with no taxable income owes a minimum tax starting at $150 for Oregon sales under $500,000, scaling up with revenue.³ S-corporations file a return and pass income through but owe the $150 minimum. LLCs and partnerships don’t pay this tax at all; their income flows to owners’ personal Oregon returns.

Payroll Registrations if You’ll Hire

If you’ll have employees, Oregon stacks several payroll registrations on top of your formation filing. Missing any one of them generates penalty exposure that accumulates quickly.

Combined Employer Registration

Every Oregon employer files the Oregon Combined Employer’s Registration, which enrolls you at once for state income tax withholding and unemployment insurance.¹³ You can complete this through the Business Registry portal at formation or through the Department of Revenue later.¹⁴ Sole proprietors with no staff don’t need to file.

Paid Leave Oregon

Nearly all employers participate in Paid Leave Oregon, which funds employee leave for family, medical, and safe-leave reasons. The 2026 total contribution rate is 1 percent of each employee’s wages up to $184,500. Employers with 25 or more employees pay 40 percent of that (0.4 percent); employees pay the other 60 percent (0.6 percent) via payroll deduction. Employers with fewer than 25 employees don’t owe the employer share but must still collect and remit the employee portion.¹⁵ You report and pay quarterly through the Frances Online system.¹⁶

Transit Payroll Taxes

If employees work in the TriMet district (Portland metro) or the Lane Transit District (Eugene-Springfield), you owe transit payroll tax on wages earned there. For 2026, TriMet is 0.8237 percent and Lane Transit is 0.80 percent.¹⁷ You register through the Department of Revenue, either as part of your Combined Employer Registration or by filing a change-in-status form later. The employer pays this; it doesn’t come out of employee wages.

Workers’ Compensation Insurance

Oregon requires virtually every employer to carry workers’ compensation insurance or qualify as self-insured. Certain corporate officers, partners, family-member owners, and independent contractors may be exempt, but coverage is the default. Operating without it brings a civil fine of up to $1,000 or twice the premium you should have been paying, whichever is greater. Continuing to operate after an order to comply adds up to $250 per day.¹⁸ Coverage has to be in place before your first employee’s start date. There’s no grace period.

Licenses and Local Permits

Filing with the Secretary of State does not authorize you to actually do business in a given industry or location. Depending on what you do and where you do it, you may need state professional licenses, local business permits, or both.

Oregon’s Business Xpress License Directory is the starting point for state requirements. It covers more than 1,400 licenses, certifications, permits, and registrations across health, food and beverage, construction, financial services, and professional occupations.¹⁹ Search by business type to see which agencies you’ll be dealing with.

Local rules layer on top. Most cities and counties impose their own business license fees, and you may need a zoning permit confirming your location is approved for commercial use. This matters especially for home-based businesses: many Oregon municipalities restrict what activities can happen in residential zones, cap customer visits, and limit how many employees can work from the home. Call your local planning department before assuming your spare bedroom qualifies.

Keep Your Business in Good Standing

Once you’re running, the single most important recurring obligation is your annual report to the Secretary of State. For all entity types except assumed business names, the report is due every year on the anniversary of your original filing date, and the Secretary of State sends a reminder roughly 45 days ahead.⁶ The annual renewal fee is $100 for domestic LLCs and $275 for domestic corporations.⁹ Miss the deadline and you get a written notice with 45 days to cure. Miss that too and the state administratively dissolves your entity. A dissolved business can only wind down; owners who keep operating in that limbo can face personal liability for debts the business incurs during the dissolution period. You have up to five years to apply for reinstatement.²

One filing catches new owners off guard: the business personal property tax. Oregon taxes business equipment, furniture, machinery, and tools, and every business must file a Confidential Personal Property Return with the county assessor by March 15 each year, reporting value as of January 1.²⁰ The filing requirement applies regardless of revenue. If the total depreciated value of your reported property falls below roughly $20,000, no tax bill is generated, but you still have to file the return.

Round that out with quarterly payroll tax filings if you have employees and whatever industry licenses need periodic renewal. The cheapest way to lose an Oregon business is not a bad product or tough competition. It’s a missed filing nobody noticed until a bank or customer pulled your standing and found it lapsed.

1
Oregon State Legislature. Oregon Revised Statute Chapter 63 – Limited Liability Companies
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Oregon State Legislature. Oregon Revised Statute Chapter 60 – Private Corporations
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Oregon Department of Revenue. Corporation Excise and Income Tax
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State of Oregon. Business Name Availability
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Oregon State Legislature. Oregon Revised Statute Chapter 648 – Assumed Business Names
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State of Oregon. Business – Annual Report or Renewal
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State of Oregon. Business – Registered Agents and Service of Process
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State of Oregon. Register a Business
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Oregon Secretary of State. Business Registry Fee Schedule
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Internal Revenue Service. Get an Employer Identification Number
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Oregon Department of Revenue. Sales Tax in Oregon
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Oregon Department of Revenue. Corporate Activity Tax (CAT)
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Oregon Department of Revenue. Form OR-CER Instructions – Oregon Combined Employers Registration
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State of Oregon. Business – Combined Employer Registration Help
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Oregon Employment Department. Unemployment Insurance Tax and Paid Leave Oregon Contribution Rates Hold Steady for 2026
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Paid Leave Oregon. What Employers Need to Do
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Oregon Department of Revenue. Oregon Transit Payroll Taxes for Employers
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Oregon Public Law. ORS 656.735 – Civil Penalty for Noncomplying Employers
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Oregon.gov. Business Xpress License Directory
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Oregon Department of Revenue. Confidential Personal Property Return – Form OR-CPPR