Start a Cleaning Service in Nebraska

Nebraska Business Startup Guide

What is required to open a cleaning business in Nebraska? Certainly this question has been asked a number of times by people who intend to take advantage of a cleaning business' potential for profit and Nebraska's business-friendly environment.

Nebraska has a booming economy due to several factors. A low crime rate, low taxes, and excellent environmental air and water quality all contribute to making it a good place to do business. In 2006, the state was recognized by Forbes magazine as the seventh best in the United States in its ranking of "The Best States for Business". As of May 2008, Nebraska's unemployment rate stood at a low 3.2%, an indicator of a robust economic condition when compared to the national rate of 5.5%.

State laws allow a business to function as a limited liability company, a corporation, a partnership or a sole proprietorship. Nebraska's tax and legal structures are similar to those imposed in the other federal government of the country. As such, it imposes income, sales and property taxes at the state and local levels. Most cleaning businesses owners choose to operate as a sole proprietorship since this is much simpler to organize. Generally, businesses of this type can be established with no formalities. What is required, though, is the acquisition of a local business license in the area of operation. Since a cleaning business provides services, it could be possible that the owner may be required to get hold of a sales tax license and collect sales tax. It should be noted that requirements vary from city to city or from county to county, so the business owner must be aware that the procedure for obtaining licenses and permits are not the same for all localities.

Start a Cleaning Business in Nebraska

The single proprietor of a cleaning business does not need to file a separate tax form. He can report profits or losses in his personal income tax return. The Nebraska tax structure has been expanded recently to apply to several services, including building maintenance and cleaning. This applies to the cleaning service business, with a statewide rate of 5.5%. Among the counties, only Dakota County imposes a sales tax but several cities have adopted it, with rates ranging from 0.5% to 1.5%. The larger cities of Omaha and Lincoln implement a 1.5% sales tax. County sales tax does not apply to a city that has a sales tax. For instance, businesses in Sioux City, which is part of Dakota County, pay taxes to the city and not the county.

Running the business alone without hiring any other employee has its distinct advantages. There is no need to pay unemployment taxes, no need to withhold income tax from wages and no need to get workers' compensation. Workers' compensation is a form of insurance mandated by the state government that provides protection for both employees and employer. It safeguards employers from legal action and damages in case an employee acquires an injury or sickness due to the job. For employees, it offers wage loss and medical benefits.

As practiced in the other states, a cleaning business in Nebraska that uses a trade name must have it registered with the Secretary of State. The law also requires publication of the registration in a local newspaper where the business is located.