Introduction
Picture yourself waking up each day, ready to build your own business—one that reflects your passion and vision. The process is straightforward, allowing you to dive into your entrepreneurial dream with confidence.
First, you choose a name for your business that resonates with you and your target audience. You want it to be memorable, so people easily associate it with the products or services you offer. Check if that name is available by searching the Oregon Secretary of State’s database. This is where you ensure no one else is using your chosen name.
Once you have your name locked down, obtain the necessary permits and licenses. Oregon has specific requirements based on your business type and location, so do a bit of research. You can visit local city or county offices to learn what you need.
Next, consider whether you want to open a separate bank account for your business. This helps keep your personal and business finances separate, making accounting easier. You may also want to get an Employer Identification Number (EIN) from the IRS, even if you don’t plan on hiring employees right away.
1. Understand What a Sole Proprietorship Means

When you start a sole proprietorship, you’re basically running your business as yourself. There’s no complicated structure like a corporation or partnership. You are the owner, and everything you make or spend flows directly through you. Think of it like your personal income and expenses—just extended to your business activities.
A great thing about a sole proprietorship is that it’s simple to set up and manage. You don’t need to file a bunch of paperwork, and you control every part of the business yourself. But, here’s one thing you need to know: since you and your business are legally seen as the same, you are personally responsible for any debts or liabilities. That means if something goes wrong with your business, your personal assets—like your savings or house—could be used to cover those debts. Got it?
2. Choose Your Business Idea and Name
The first real step you need to take is to decide what you want to do. Maybe you want to open a coffee cart, start a lawn care service, offer personal coaching, or sell handmade crafts. Whatever it is, pick a business idea you’re excited about and one you think can make money.
Now, about the name. In a sole proprietorship, you can either use your personal name or you can choose a unique business name. If you use your personal name, you won’t need to register it, but using a different name makes your business look more professional. For example, instead of just “Sarah Miller,” you might want to call your business “Miller Home Cleaning.
If you decide to use a business name that isn’t your personal name, Oregon requires you to register a “DBA” (Doing Business As).
3. Register Your Business Name (DBA) with the State of Oregon

If you need to register a DBA, here’s how you do it. Go to the Oregon Secretary of State website and search for the “Assumed Business Name” registration. Make sure the name you want isn’t already taken—there’s a search tool on its website where you can check for name availability.
Once you confirm that the name is available, fill out the Assumed Business Name registration form. It’s an easy online process that takes just a few minutes. The fee for registering a business name in Oregon is around $50. Once you pay, the state approves the name, and you get a confirmation.
4. Apply for Necessary Business Licenses and Permits
Don’t forget any licenses or permits you might need. Oregon doesn’t require every sole proprietor to have a general business license, but depending on what type of business you’re running and where you’re located, you may need specific licenses or permits.
- City or County Business License: Some cities in Oregon, like Portland or Eugene, require a local business license. You need to contact your city or county government to ask if this applies to you.
- Industry-Specific Permits: If your business involves food (like a coffee cart or food truck), construction, or childcare, then you need extra permits. These vary depending on your industry, so do a little research or call the Oregon Business Xpress office, which offers help to new business owners.
5. Get an Employer Identification Number (EIN) from the IRS
If you plan to hire employees or open a business bank account, you need an Employer Identification Number (EIN) from the IRS. The good news? It’s free and easy to get. Even if you don’t plan to hire anyone, some banks require an EIN to open a business account, so it’s worth having.
To apply, go to the IRS website and fill out the EIN application online. It takes only about 10-15 minutes, and you get your EIN right after you submit the form. Keep this number safe because you need it for tax purposes.
If you’re operating the business alone with no employees, you can technically use your Social Security Number instead of an EIN, but it’s better to get an EIN for privacy reasons. You don’t want to hand out your Social Security Number to vendors or customers!
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6. Open a Business Bank Account
Now that you have your DBA (if needed) and EIN, it’s time to open a business bank account. Believe it, even though you’re starting small, it’s smart to separate your personal finances from your business money. It makes life easier when it’s time to file taxes and helps you track your profits and expenses.
Most banks in Oregon can ask for these documents when opening a business account:
- Your DBA registration (if using a business name)
- Your EIN
- Your driver’s license or other ID
Shop around for a bank that offers good terms for small business accounts. Some banks even waive monthly fees for new businesses or sole proprietors.
7. Set Up a Simple Bookkeeping System
Keep track of what you earn and spend. For a sole proprietorship, you don’t need fancy accounting software. You can use a spreadsheet or a simple tool like QuickBooks Self-Employed.
Keep records of:
- Income: Every sale or payment you receive
- Expenses: Things like supplies, gas, internet bills, or rent for your workspace
- Receipts: Save your receipts! They can reduce the amount of taxes you owe.
Setting up a system early on makes tax season a breeze.
8. Understand Your Taxes
Now, here’s an important part. As a sole proprietor, your business income is taxed as personal income. This means that whatever profit your business makes is reported on your personal tax return using a Schedule C form. You must report your income and expenses at the end of the year.
Also, you may need to pay estimated taxes every quarter instead of waiting until the end of the year. This is because Oregon and the IRS want their cut of your profits throughout the year, not just in April! You can set aside around 20-30% of your profits each month to cover these taxes, so you’re not caught off guard.
Oregon also has a state income tax, so make sure you plan for that too.
9. Consider Getting Business Insurance
You’re almost ready to go! But don’t neglect the power of business insurance for a second. Even though it’s not required for all businesses, insurance can protect you if something goes wrong.
For example:
- If you run a cleaning business and accidentally damage a client’s property, liability insurance can cover the costs.
- If you run a delivery business, commercial auto insurance may be required for your vehicle.
Depending on your business, it’s worth talking to an insurance agent to see what kind of coverage you might need.
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Recap
To start a sole proprietorship in Oregon, begin by selecting a catchy and meaningful name for your business, ensuring it’s available through the Oregon Secretary of State. Then, you dive into the necessary permits and licenses, checking in with local city or county offices for specific requirements.
Opening a separate bank account is a smart move to keep your personal finances distinct from your business income. And don’t forget about applying for an Employer Identification Number (EIN) from the IRS, even if you’re not hiring right away.
The process may seem a bit overwhelming at first, but it’s manageable. Each step brings you closer to turning your vision into reality. Don’t hesitate to seek professional advice and stay informed about changes in the business world.
So, take a deep breath, trust yourself, and embrace this exciting new chapter as you embark on your entrepreneurial journey in Oregon.
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