Your first consideration when choosing a name for your LLC is that it be unique from any other business in the state of New York. You can quickly and easily check your company’s potential name options at the New York Department of State Division of Corporations business name database. For a $20 fee, you can also reserve a company name for 60 days. To do so, you’ll need to submit an Application for Reservation of a Name form by mail.
In order to comply with New York state law, your company’s name must contain some form of the term “Limited Liability Company.” Specifically, you can choose from the full term or one of two abbreviations: “LLC” or “L.L.C.” You must obtain consent from the appropriate agency if you want your LLC name to use terms related to licensed professions or businesses. The state also prohibits you from using the following terms: “Board of Trade,” “Chamber of Commerce,” “Community Renewal,” “Corporation,” “Incorporated,” “Partnership,” “State Police,” “State Trooper,” “Tenant Relocation,” “Urban Development” and “Urban Relocation.”
New York is very sensitive with restricted and prohibited words, so we recommend you review this page for a complete list.
The state of New York requires that any LLC appoint the New York Department of State as its registered agent for service of process. This means the Department will accept and process any legal paperwork on your LLC’s behalf should it be sued. You can choose to appoint an additional agent who is a New York state citizen or company authorized to do business in New York. The Department of State will forward all legal work to your chosen agent.
New York requires you to publish notification of your LLC’s formation (see step 6 below), which can be quite expensive depending on where your registered agent’s address is. Counties such as New York, Bronx, and Queens can have publication costs over $1000. This is one way a registered agent service can save you some serious cash. For example, ZenBusiness’s registered agent service (which you can purchase for only $10/month) is located in Albany County, which is the least expensive New York county to publish in.
New York is one of the few states to require LLCs to adopt an official operating agreement for the company. Much like the bylaws required by corporations, operating agreements outline the rules and operating procedures for managing an LLC. Though your operating agreement is not required to be filed with the state, your LLC should have an official document drafted no later than 90 days after filing the articles of organization.
An IRS Employer Identification Number (EIN) is required for your LLC unless it is a single-member LLC with no employees. Obtaining an EIN is as easy as completing the application on the IRS website.
It’s possible your company will need to register with the New York Department of Revenue (DOR). Whether or not your company needs to follow this step will depend on the exact types of taxes it will be collecting and/or has been collecting from the state and if you have employees. The New York Business Tax Application (Form XYZ) can be filed online through the New York _____ website or by mail.
If your LLC sells a physical product, you’ll need to register for a seller’s permit, known as a Sales Tax Certificate of Authority, with the New York Department of Taxation and Finance. This allows you to collect sales tax on taxable sales. Additionally, If you have employees, you’ll need to register for Unemployment Insurance Tax with the New York Department of Labor and Employee Withholding Tax with the New York Department of Taxation and Finance.
New York is also one of the few states that require LLCs to publish public notice of formation. You’ll need to publish copies of the articles of organization, or otherwise stated declaration of formation, with two newspapers designated by the applicable county clerk. This should be done within 120 days of your effective date. Once published, the printers of the newspapers will provide an affidavit of publication. You’ll then submit a Certificate of Publication along with the affidavits and a $50 fee to the New York Department of State, Department of Corporations.
If yours is a foreign LLC, also referred to as an out-of-state LLC, wanting to do business in the state of New York, you’ll need to follow all the steps above with a few differences.
You will need to file a Foreign Limited Liability Company Application with the New York Secretary of State as well as a Certificate of Existence from your LLC’s domestic or home state. The Certificate of Existence must date back no more than 90 days prior to filing. The filing fee is the same as a domestic LLC in New York at $165.
Some industries will require you to secure federal, state, and/or local licenses to legally operate in the state of New York.
Since business licenses and permits are issued at all levels of government—federal, state, and local—and for such a multitude of reasons, you should still do careful research to find out what licenses and permits you need. You can also hire or use a professional service to do it for you.