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STARTING AND OPERATING A BUSINESS IN OREGON Copyright © 2004, Michael D. Jenkins
CONTENTS OF THIS SECTION:
I. INTRODUCTION I. INTRODUCTION Oregon has a fairly typical tax and legal structure under which businesses must operate, except that it is one of the few states that does not impose a sales tax. Like most states, Oregon imposes an income tax on individuals, an income tax on corporations, and various excise taxes, with property taxes imposed at the local level. The state has also adopted a limited liability company (LLC) law, and a limited liability partnership (LLP) law, so that businesses operating in Oregon in LLC or LLP form may obtain the advantages of limited liability, without incorporating or becoming subject to corporate taxation, generally. At present, the state's economy is somewhat sluggish, as its unemployment rate remains considerably higher than the national rate of unemployment. In July, 2004, the state's unemployment rate was 6.8%, down from 8.7% a year earlier. This compares to a national unemployment rate of 5.5% for July, 2004. To view the latest federal Bureau of Labor Statistics unemployment rate data for Oregon or any other state, visit the BLS website. II. LEGAL ENTITIES -- FILING FEES AND REPORTING REQUIREMENTS. (a) In General. A business that operates in Oregon can operate as a sole proprietorship, a general or limited partnership, a corporation, or a limited liability company. In addition, like the federal tax law, the state income tax law also recognizes S corporations, for income tax purposes, and generally allows the income or losses of an S corporation to "flow through" and be taxed or deducted at the shareholder level, rather than taxing the corporation itself as an entity. Oregon also provides for limited liability partnerships, in which no partner is liable for certain debts of the partnership, somewhat like a corporation or LLC, but with fewer legal formalities than are required for either a corporation or an LLC. Each of the above entities is discussed below, along with the basic requirements for forming such an entity and any general ongoing (non-tax) reporting requirements that are applicable to it. The tax treatment of each form of legal entity is discussed in Section IV below. (b) Sole Proprietorships. In general, sole proprietorships in Oregon can be formed with no formalities. However, as discussed in Section IV(b), it will generally be necessary to obtain one or more local business licenses from cities or counties in which you operate and, in some cases, state licenses, as well. In addition, a sole proprietorship whose business name does not include the full name of the owner must file an assumed name registration with the Secretary of State of Oregon. No separate tax form filing is required, generally, for a sole proprietorship, under the Oregon income tax law. Instead, as with the Schedule C on your federal Form 1040, you simply report the net income or loss from your sole proprietorship on your state personal income tax return. See Section IV(c) for information on the Oregon income tax and filing requirements for individuals. (c) Partnerships. As a rule, general partnerships in Oregon can be formed with no formalities, although it is highly advisable to have a written partnership agreement. However, as discussed in Section IV(b), it will generally be necessary to obtain one or more local business licenses from cities or counties in which you operate and, in some cases, state licenses, for any type of partnership, including general or limited partnerships, or limited liability partnerships. A limited partnership, in which there is at least one general partner (who is liable for partnership debts) and at least one limited partner (who is not liable for partnership debts), may also be formed under Oregon law. Unlike a general partnership, a limited partnership must generally have a written partnership agreement, and must file a Certificate of Limited Partnership with the secretary of state, together with a filing fee of $50. Foreign limited partnerships must also register before being allowed to do business in Oregon, and must pay a registration fee of $50. Limited partnerships are also required to file an annual report with the secretary of state. Domestic limited partnerships and foreign limited partnerships both pay an annual fee of $50. For information on limited partnership filing requirements, see the contact information for the offices of the Oregon Secretary of State, listed in Section VI(a). Limited liability partnerships (LLPs) are a new form of partnership permitted under the laws of Oregon. Like an LLC, an LLP provides limited liability for its owners, while retaining the tax advantages of a partnership for federal and Oregon state income tax purposes. However, unlike an LLC, an LLP typically operates like a regular partnership, and is not required to file articles of organization. To form an LLP in Oregon, you must file a registration and pay a filing fee of $50 to the secretary of state. Foreign LLPs, those created under the laws of another state, must register with the secretary of state and pay a fee of $50. Note that the Oregon LLP law appears to give much less protection to partners in an LLP than state law grants to stockholders of a corporation. The Oregon law shields a partner in an LLP from liability that results from claims brought against another partner (or employee under the supervision of another partner) in the LLP for malpractice, malfeasance, or other such wrongdoing. The LLP law does not offer a partner any liability protection from his or her own misconduct, however. Every LLP doing business in Oregon, including both domestic and foreign LLPs, must file an annual report and pay an annual registration fee, which is $50 for either a domestic or foreign LLP. For more information on LLP registration and reporting requirements, see the contact information for the offices of the Oregon Secretary of State, listed in Section VI(a). Note that one potential drawback of LLPs, if you will do business in other states besides Oregon, is that you may not enjoy limited liability with regard to creditors of the LLP if you do business in some such states. Some states, like California and New York, only recognize certain types of professional partnerships as LLPs. Such other states may simply treat your LLP like an ordinary general partnership, with no limitation of liability. A partnership agreement, for any type of partnership, should spell out in considerable detail such matters as the following:
Partnerships, as entities, are not subject to state income tax in Oregon. Instead, the income or losses of the partnership, as allocated among the partners, must be reported on the personal income tax returns of the individual partners (or on the corporate tax returns of any corporate partners). Partnerships are required to file an annual tax information return with the state. For details on Oregon partnership tax return filing requirements, see Section IV(c). (d) Corporations. To form a corporation in Oregon, you must file articles of incorporation with the Oregon Secretary of State and pay a fee of $50. A foreign corporation (one formed under the laws of another state or a foreign country), must obtain a certificate of authority before it may legally conduct business in Oregon, by filing an application for a certificate of authority and paying a filing fee of $50. For more information on filing articles of incorporation or applying for a certificate of authority to do business in Oregon, see the contact information for the offices of the secretary of state, listed in Section VI(a). In addition, once your corporation is formed, it will be required to file an annual report and a filing fee of $50 with the secretary of state each year. Failure to file this report on a timely basis could result in suspension or revocation of your corporation's charter. In addition to paying federal income taxes on its income, a corporation that does business in Oregon must also file corporate income tax returns with the state. See Section IV(c) for a discussion of state corporate income tax rates and tax return filing requirements. For tax forms and more information on corporate income taxes in Oregon, see the contact information for the offices of the Oregon Department of Revenue, listed in Section VI(a). (e) S Corporations. An S corporation is simply a regular corporation that has elected, for federal or state income tax purposes, or for both, to be taxed somewhat like a partnership, with its income, losses and tax credits flowing through to its owners, who report such income, losses, or credits on their individual tax returns. Oregon recognizes S corporations for income tax purposes, and treats them in a manner similar to the federal tax treatment. (f) Limited Liability Companies. Oregon, like every other state in the U.S., has adopted a limited liability company (LLC) law. Thus, in addition to the traditional choices of a sole proprietorship, partnership, or corporation, a business that operates in Oregon may also choose to operate in the form of an LLC. In most states, LLCs are very attractive entities for many small businesses, in that they offer the same protection as a corporation from creditors for debts of the business, while offering much of the flexibility plus the flow-through tax treatment of a partnership for federal tax purposes. See Section IV(c) for a discussion of the income tax treatment of LLCs under Oregon's tax laws. To form an LLC under the laws of Oregon, one or more persons must file articles of organization with the Oregon secretary of state, which must be accompanied by a filing fee of $50. Oregon state law allows formation of one-owner LLCs, which now qualify for treatment as sole proprietorships for federal tax purposes. Foreign LLCs, those formed under the laws of another state, must obtain a certificate of authority to do business in Oregon, by filing an application for a certificate of authority with the secretary of state and paying a filing fee of $50. In addition to initial filing fees, an LLC formed in Oregon must subsequently file annual reports and pay an annual report filing fee of $50 with each such annual report. A foreign LLC is also required to file an annual report and pay the applicable filing fee of $50. For more information on filing articles of organization for an LLC, see the contact information for the offices of the secretary of state, listed in Section VI(a). III. BUSINESS ACQUISITIONS (a) In General. When acquiring an existing business, there are a number of state legal and tax issues you or, preferably, your business attorney, should attend to before closing the purchase. These include matters such as doing a title search for any real property that is being acquired, checking for any recorded security interests on personal property items, and thoroughly researching county, state, and federal records for any judgment liens, tax liens, or other liens, before property is acquired. You will also benefit from consulting a tax advisor before the agreement of sale is negotiated, in order to seek a structuring of the agreement so that the purchase price is allocated among the assets in a way that favors you. You may be able to obtain considerable tax savings if the purchase price is allocated in a way that gives you the best possible tax results under federal and state income tax laws, and other state tax laws, such as property tax laws. Depending upon the state (or states) in which the seller's assets are located, you may also have to comply with state bulk sale or bulk transfer laws. You should also obtain tax releases from various state taxing agencies, as discussed below. (b) Bulk Sale Laws. Typical bulk sale laws require either publication of legal notices to all creditors in advance of the sale and recording of such notices in some cases, or maintenance of detailed lists of the property to be transferred, for inspection by the public. Oregon is one of the business-friendly states that has repealed its bulk sale laws, so you no longer have to be concerned with this requirement when buying a business in Oregon. (c) Tax Releases. When you acquire an existing business, you will want to make sure that you do not unwittingly become liable for any unpaid taxes owed by the seller. Typically, to protect yourself, you will need to receive a tax release or releases from various state taxing agencies, for such taxes as sales and use tax, income tax withholding, and state unemployment taxes, in each state in which the seller does business. If you fail to obtain such a release or written statement from the tax agency that the seller is not delinquent on any tax payments, you will be held responsible for such tax if it is not withheld from the purchase price proceeds and paid to the state at the time the sale of the business transpires. In Oregon, you need not be concerned with obtaining a sales tax release, as there is no sales or use tax in Oregon. However, you should attempt to ascertain whether the seller is delinquent on payment of any state unemployment taxes, or you may be held liable for such unpaid taxes. (d) Unemployment Tax Rating of Seller. In addition to obtaining tax releases, you may find it advantageous to succeed to the seller's unemployment tax experience rating, if the seller has a tax rate lower than you would otherwise obtain as a new business. If you wish to obtain the seller's favorable experience rating as a successor employer, you will need to contact the Oregon Employment Department on a timely basis, requesting that you be treated as a successor employer. IV. OREGON TAXES AND OTHER GENERAL REQUIREMENTS. (a) In General.
Oregon has a relatively high state income tax on individuals,
reaching its maximum rate of 9% at very low levels of income.
On the other hand, the corporation excise (income) tax is
relatively moderate, at 6.6% of taxable income, and Oregon
is one of only five states that does not impose any sales or
use tax.
As noted in Section IV(c), there
are also a number of city, county and transit district taxes
on income or payroll in Oregon, as well as the state taxes on
income.
(b) State and Local Licensing. Nearly any business, operated anywhere in the United States, will have to have at least one government license of some kind. In most cases, this will be a local license, issued by your city or county. Before you open your business, contact your local city or county hall and find out if your particular business needs one or more local licenses. Most kinds of local business licenses are granted upon payment of a fee, with no further requirements, except possibly for annual or other periodic renewal fees. However, if you are engaging in any kind of food business, you will usually need to also obtain a health department permit and show that you are in compliance with health department food-handling requirements. In addition, be sure to check with an attorney or local government zoning or planning department officials to determine if your business will be in compliance with all local zoning and planning restrictions. If you own or rent any type of facility, you will generally need fire department permits, showing that you meet fire safety codes and any construction or improvements to an existing structure will usually require a building permit. If you intend to simply operate your business from your home, you may be in violation of local zoning requirements, but this is less likely to be a concern if you don't have clients, customers, suppliers, or employees coming to your house on business, on a regular basis. State governments have also traditionally required special licenses for many kinds of professionals, such as physicians, dentists, lawyers, and accountants. To further protect consumers, Oregon has expanded the list of occupations that must be licensed by the state to include many other occupations. Most state licenses not only require payment of fees, but are only issued for a given profession or occupation upon showing that you have completed certain educational or experience requirements, or passed certain tests, or some combination of the foregoing. For information on state licensing and business registration requirements in Oregon, see the contact information for the offices of the Business Referral Center, listed in Section VI(a). (c) Income and Franchise Taxes. Oregon has both an individual income tax and a corporate income tax. In addition to state income taxes, there are also a number of county and regional taxes on wages or income, imposed mainly in urban areas of the state. These include:
The Oregon individual income tax is imposed at a maximum tax rate of 9%. Individual taxpayers generally pay state income tax on their business earnings from a sole proprietorship, or on their share of the earnings of a pass-through entity, such as a partnership, S corporation or LLC. The Oregon personal income tax return is Form 40, which must be filed with the Oregon Department of Revenue. Unlike many states, Oregon allows a (limited) deduction of federal income taxes paid or determined each year. In 2004, up to $4,000 of federal income tax is allowed as a deduction. This limit will increase to $4,500 in 2005 and to $5,000 in 2006. Partnerships, or entities taxable as partnerships, such as LLCs, are not subject to state income taxation in Oregon, but must file an information return with the Department of Revenue each year, showing each partner's share of taxable income, losses, and credits, on Form 65. The partnership information return is due by the 15th day of the fourth month after the end of the partnership's taxable year. Individual taxpayers doing business as sole proprietors, or who are partners in partnerships, or members of LLCs, are required to make payments of estimated Oregon individual income taxes, on Form 40ES, if their net tax liability (not covered by withholding) exceeds or equals $1000. Estimated tax payments are due in four installments, on the 15th day of the 4th, 6th, and 9th months of the taxable year, and the 15th day of the first month of the following year. The Oregon corporate income tax rate, on corporations other than S corporations, is 6.6%. There is a minimum annual tax of $10. In February, 2004, Oregon voters rejected a proposal that would have greatly increased the minimum tax on corporations, to $250 for the smallest corporations or as much as $5,000 for those with over $25 million of sales in Oregon. The corporation minimum tax thus remains at $10. The state corporation income tax return is Form 20, which must be filed with the Department of Revenue within one month after the due date of the federal return, or by April 15th in the case of a corporation whose taxable year is the calendar year. Corporations are required to make estimated tax payments of their state corporate income tax in advance, if their tax liability for the year equals or exceeds $500. Estimated tax payments are due in advance, in four equal installments, on the 15th day of the 4th, 6th, 9th, and 12th months of the taxable year. Penalties will be imposed for failure to make the required estimated tax payments on a timely basis. Corporations that are required to make federal estimated tax payments by electronic funds transfer must also make payments of their estimated Oregon state income tax by electronic funds transfer. In Oregon, a limited liability company (LLC) is taxed in the same manner as a partnership, unless it is taxable as a corporation for federal income tax purposes. It is thus possible with an LLC to avoid the double taxation of income that can occur with a corporation. Note that under IRS regulations, an LLC may elect to be treated as a partnership if it has more than one owner, or as a sole proprietorship if it does not, for federal tax purposes. Oregon law now recognizes the validity of a one-owner LLC. Note that it is not always entirely clear whether an LLC is a "single-member LLC" LLC or not, where the "single owner" is a married couple who hold the entire ownership of the LLC in some form of co-tenancy, such as joint tenants with right of survivorship, tenants by the entirety, or as tenants in common. The federal Internal Revenue Service (IRS) has taken a very lenient position in Rev. Proc. 2002-69, where a couple hold the LLC interest as community property, ruling that the IRS will accept whatever choice the couple make, either to disregard the LLC as an entity (treating it as a "single-member LLC") or to treat it as a partnership between the husband and wife. However, Oregon is not a community property state, so where the LLC is owned by a husband and wife in some form of co-tenancy, it is unclear whether the IRS treatment would be as lenient as for community property owners, since the IRS has not issued any published rulings on whether an LLC can be a disregarded entity if held in one of the various forms of co-tenancy by a married couple, rather than being held as community property. Thus, it is also unclear, where an LLC is owned by a husband and wife as co-tenants, whether Oregon would treat the LLC as a single-member LLC or as a partnership. (d) Sales and Use Tax. There is no general sales or use tax in Oregon. In addition, Oregon adopted a law in 2001 that prohibits any municipalities and other political subdivisions in the state from imposing any kind of new state or local taxes on Internet access services. (e) Real and Personal Property Taxes. In Oregon, as in every other state, any business real estate you own will be subject to real property taxes. In general, there is little that you must do, unless you wish to challenge your assessed valuation, since the assessor will bill you for each year's property taxes as they come due. Oregon also imposes personal property taxes on tangible personal property. However, certain business personal property, such as business inventories, are exempt from personal property tax in Oregon. Every business is required each year to file a personal property report with the county assessor's office for the county where the property is located, and should include on the report all personal property on the business premises on the assessment date. The report must list all personal property in the county as of 1:00 A.M. on January 1 and must be filed with the county assessor by March 1. You will have to file in each county where your business has tangible personal property. Contact the county assessor for more information and for property tax report forms. While Oregon generally taxes tangible personal property, it does not impose a property tax on intangible personal property, such as stocks, bonds, promissory notes, and other such paper assets. (f) Other Business Taxes. Oregon imposes a number of other taxes on businesses, some of which may affect you. These include:
Unlike many states, Oregon has no real estate conveyance taxes. (g) Trade Names. A trade name, also known as a fictitious or assumed name, is any name used in the course of business that does not include the actual legal names of all the owners of the business. Thus, if your business goes by any name other than your own real name, it is operating under an assumed name. The same is true of a corporation, if it operates under a name other than its legal name. Any name that a person uses to identify a business that includes a word or phrase that suggests the existence of additional owners, such as "Company," "& Company," "& Daughters," "& Associates," or a similar word or phrase, is an assumed business name, unless it is the real and true name of the person that carries on, conducts or transacts the business. In most states where you do business, it will be necessary to register a trade, fictitious, or assumed name, so that people who do business with you can find out who the actual owners of your business are. You may also want to register any such assumed name, as a means of protecting against other companies usurping that particular business name. In Oregon, a business that operates under an assumed business name is required to register the name with the Business Registry of the secretary of state, paying a registration fee every two years of $50. An assumed name must also be registered in at least one county. A sole proprietorship is not required to register if its business name includes the full legal name of the owner. The same is true for a general partnership, unless the name suggests additional owners, or does not include names of all owners. Corporations, LLCs, and limited partnerships need not register, unless they are not using their legal name, or are using a name that does not include the "Inc.," "LLC" or "Ltd." designation that would identify the type of entity. V. EMPLOYER REQUIREMENTS IF YOU HAVE EMPLOYEES (a) Employer Registration and Withholding. Once you hire the first employee in your business, you must comply with many more Federal and state laws. One of the first things you will need to be concerned about as a new employer is withholding personal income taxes from the wages of your employees. As an employer, you are responsible for withholding the taxes and paying them over to the state government on behalf of the employee. If you have any employees, you will already be withholding federal income tax and FICA taxes from their wages. Since Oregon imposes a state income tax on the income of individuals, you will need to also withhold Oregon income tax from the wages of your employees. Before you begin to pay wages, you must register as an employer with the Department of Revenue on Form 150-211-055, Combined Employer's Registration. This registration will be for state income tax withholding, as well as for Tri-Met and Lane County transit district payroll taxes. Corporate employers that are required to make federal payroll taxes electronically must now also make Oregon payroll tax payments by electronic funds transfer. For more information on Oregon income tax withholding and registration requirements for employers, see the contact information for the offices of the Department of Revenue, listed in Section VI(a). (b) Unemployment and Other State Payroll Taxes. If your business employs one or more individuals in each of 18 weeks during a calendar year or if your payroll amounts to $225 or more in any calendar quarter, you, as an employer, will be required to pay state unemployment tax based on the amount of such wages paid. Different standards apply if you are an agricultural employer. Employers subject to the Oregon unemployment tax are required to register with Oregon Employment Department on Form 150-211-055, Combined Employer's Registration, to obtain an employer registration number for unemployment tax purposes. New employers are required to pay tax at a rate of 3.3% in 2004 on the first $27,000 of wages paid to each employee. After you have had employees for a while, you will develop an unemployment tax experience rating. This rating is based on the number of employees you terminate who then claim unemployment benefits and the amount of such benefits paid to those former employees, under complex formulas. The state will inform you when they have assigned you an individual tax rate based on your firm's experience rating. That rate may be higher or, if you have had relatively few benefit claims charged to your account, lower than the standard new employer tax rate you were initially paying. For employers with experience ratings, the tax rate can range from 1.8% to 5.4% in 2004. All state unemployment taxes are imposed upon you as the employer, and, under Oregon law, cannot be charged to your employees or withheld from their wages. For more information on your Oregon unemployment tax obligations as an employer, see the contact information for the offices of the Employment Department, listed in Section VI(a). (c) Workers' Compensation. In Oregon, virtually all businesses with one or more employees are required by law to have workers' compensation insurance, except those able to self-insure. Note, however, that a sole proprietor or a partner in a partnership is generally not considered an employee. Some corporate officers are also exempted, if they are on the corporation's board of directors and either own at least 10% of the stock or an amount of stock equal to the average amount held by all stockholders. Most members of LLCs are also exempt. (However, exemptions for corporate officers or LLC members in the construction industry (and timber industry, in the case of corporations) are limited to only two such officers or members per company, or one for every 10 employees, whichever is more.) Workers' compensation provides wage loss and medical benefits to employees injured on the job and it protects you, as an employer, from legal action for damages for injuries or job-related illnesses suffered by your employees. In effect, it is a "no-fault" insurance system for work-related injuries or illnesses. Thus, if you fail to obtain required workers' compensation insurance, and an employee is injured on the job, you will have opened yourself to unlimited liability and severe legal consequences, so it is very important to obtain workers' compensation insurance for your employees. Be aware that neither general liability nor health and accident insurance can properly substitute for workers' compensation insurance. As an employer, you must notify injured employees of their benefits and post a notice in the workplace informing your employees of their workers' compensation coverage. For more detailed information regarding your obligations as an employer under the Oregon workers' compensation laws, contact your insurance carrier or see the contact information for the offices of the Workers Compensation Division, part of the Department of Consumer and Business Services, listed in Section VI(a). (d) State Wage and Hour Laws. Some employees of certain small firms not engaged in interstate commerce are not covered by the federal minimum wage and overtime laws. However, even if few or none of your employees are covered by the federal wage-hour laws, if, for example, because your firm does less than $500,000 a year in gross sales and the employees in question are not deemed to "...engage in (interstate) commerce...," they will still generally be subject to the Oregon wage-hour laws, which provide for a state minimum hourly wage that increased to $7.05 per hour on January 1, 2004, as a result of the passage of a ballot initiative passed in 2002 by Oregon voters. The minimum wage is adjusted each year for inflation. Note that, as under federal wage-hour laws, certain classes of executive, administrative, and professional employees are exempted from the Oregon wage-hour rules, as well as outside sales persons and taxicab drivers. Besides the federal wage-hour posters that you must display in the workplace, you must also display a state wage-hour poster, which you can obtain from the Bureau of Labor and Industries. In addition to wage-hour laws, most businesses are subject to federal child labor laws, which put numerous restrictions on the working hours and kinds of work in which minors under the age of 18 may engage. Your business must also be cognizant of similar state child labor laws, in Oregon. The Oregon labor laws require a work permit for all children of the ages 14 to 17, which the employer must submit to the Bureau of Labor and Industries within 48 hours after the child commences work. (e) State Occupational Safety and Health Laws. Approximately half of the states have their own OSHA-like agency, charged with administering the state's own occupational safety and health laws. The remaining states have no such enforcement agency, and thus rely instead on the federal Occupational Safety and Health Administration (OSHA) to administer the federal job safety rules within such states. Oregon is one of the states that has its own OSHA-type agency. To determine if your workplace is in compliance with federal and Oregon job safety requirements, you may wish to contact the Oregon Occupational Safety and Health Division (OR-OSHA), part of the Department of Consumer and Business Services, and request a free on-site safety consultation. You will not be cited for any violations detected, provided that you promptly correct the unsafe conditions. This differs from the rules for consultations by federal OSHA inspectors, who are required to cite you for any violations they find. All employers with eleven or more employees are required to establish a safety committee, as do certain employers of less than eleven employees in certain industries with hazardous working conditions. For information on your job safety and health obligations as an employer, required posters, and possible on-site safety consultations, see the contact information for the Salem offices of OR-OSHA, listed in Section VI(a). Be sure to request the Employer Tool Kit, an information packet that includes items required to be posted in your workplace and a booklet on how to develop your employee safety and health program. (f) Other Miscellaneous State Labor Laws. Other Oregon labor laws you need to be aware of, as an employer, include the following: (1) Wage payments to terminated employees. A terminated employee must generally be paid accrued wages by the end of the next business day after discharge. An employee who quits without giving notice must be paid final wages within five days (not counting weekends or holidays) or by the next regular payday, whichever is earlier, in general, or an employee who quits after giving at least 48 hours' notice must be given his or her final paycheck on the final day of work. The final paycheck must be mailed to the terminated employee if the employee requests that the employer do so. Employers must establish regular paydays, that cannot be more than 35 days apart. (2) Right-to-work laws. About half the states have enacted "right-to-work" laws, which guarantee that no person may be denied employment for refusing to join a union or for not paying union dues, thus banning either "union shop" or "agency shop" agreements, or both. In a union shop, an employee not belonging to a union may be hired but then must join the union, usually within 30 days. In an agency shop, an employee need not join the union but, to remain employed, must pay union dues. Oregon does not have such a right-to-work law and allows union shop or agency shop contracts between an employer and a union. (3) State anti-discrimination laws. In addition to complying with federal anti-discrimination laws, employers must also be aware of and comply with state civil rights laws in Oregon, and display a poster informing employees of their rights. You can obtain this poster from the Portland office of the Bureau of Labor and Industries, Civil Rights Division, at the address listed in Section VI(a). (4) Reporting new hires. Under federal welfare reform laws, employers in all states are now required to report newly-hired (or rehired) employees to a designated state agency (the Oregon Department of Justice for Oregon employers) within 20 days after the date of hire. (5) Family Leave Act. The Oregon Family Leave Act, which is similar to the federal Family Leave Act, requires employers of 25 or more employees to provide an employee unpaid family leave of up to 12 weeks a year for serious health conditions of the employee or to care for close family members, and an additional 12 weeks in certain circumstances, such as for pregnancy disability leave. An Oregon Family Leave Act poster, which may be obtained from the Bureau of Labor and Industries, must be posted in the workplace of covered employers. VI. STATE SOURCES OF HELP AND INFORMATION (a) Key State Agencies Contact Information. Oregon, as many states have done in recent years, has set up a "one-stop" center to help your new or existing businesses to obtain all necessary state licenses and permits from a single office, without your having to go from agency to agency to meet all the legal and regulatory licensing requirements. The Secretary of State's office and five other key state agencies have cooperated to establish a Business Referral Center, which can help you get your business started in Oregon by sending you a packet of registration forms and by referring you to the appropriate state regulatory agencies and boards. An online "Business Wizard" is provided on the Secretary of State's website, to help you determine what state regulatory requirements will apply to your business. To obtain business registration forms and information on starting or relocating your business in Oregon, contact:
SECRETARY OF STATE. Contact the office of the secretary of state for information on:
STATE SALES TAX. You will not need to register for a sales tax permit in Oregon, as the state has no sales or use tax. EMPLOYER WITHHOLDING. Contact the Oregon Department of Revenue for information and tax withholding forms, at the address listed above for that agency. STATE UNEMPLOYMENT TAX. Contact the following state agency to determine whether you are an employer subject to payment of state unemployment taxes, and for registration as an employer if you are subject.
NEW HIRE REPORTING. Report newly hired (or rehired) employees within 20 days to the Oregon Department of Justice, at the following address:
(b) Small Business Development Centers. A number of Small Business Development Centers (SBDCs) are located throughout Oregon to assist you. These centers, usually located on college campuses, provide a wealth of start-up information and sponsor frequent business-oriented seminars. Contact the lead office below for information, or for the location of other SBDCs nearer to you.
(c) Internet Sites. If you have access to the Internet, there is a wealth of state and even local business information provided by state and local governments. All states now have a state government Web page, and most major state agencies also have sites on the Internet where you can obtain useful small business information on matters such as state taxes, financing sources, or the addresses and phone numbers (or e-mail addresses) of various state and federal agencies' offices in Oregon. Since new sites are appearing constantly, you might also want to search for other Oregon government Web sites by using one of the popular Internet search engines, such as Excite! or Yahoo. To start your Internet search for Oregon government information, you may want to begin with the following Internet sites: State of Oregon home page: Oregon Department of Revenue Web page: Department of Consumer and Business Services (main Oregon regulatory agency): Oregon Employment Department (unemployment tax): Bureau of Labor and Industries (minimum wage, child labor, anti-discrimination enforcement):(d) Financing Sources. For information and help on locating financing for your small business, contact the nearest U.S. Small Business Administration office in Oregon, or contact the following state agency regarding state sources of financing, including the Oregon Capital Access Program:
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Copyright © 2004 Michael D. Jenkins
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