Guide to Getting a New Jersey LLC

1. Name your New Jersey LLC

Give a name to your LLC in NJ. Coming up with the perfect name for your business can be both challenging and fun. You want to find something memorable that reflects the products and/or services you’re offering. But you also need to follow New Jersey’s naming rules if you want your filing to be accepted:

• Your limited liability company name needs to be one of a kind within the state of New Jersey. No other business can have that name or something too similar to it. To make sure you aren’t picking a name that’s the same or almost the same as an existing business in New Jersey, you can consult our New Jersey business search page.
• Your LLC’s name must contain a “designator” that tells the public that you’re a limited liability company. In Jersey, your choices are “limited liability company” or the abbreviation “LLC” or “L.L.C.” “Limited” may be abbreviated as “Ltd.,” and “company” may be abbreviated as “Co.”
• Avoid words that could mislead the public, such as words that could make your business sound like a government agency (such as police, city, federal, etc.) Other words may require special licensing or the approval of a state agency, such as medical, insurance, engineer, bank, etc.

Outside of following New Jersey law, you have other important considerations when choosing a name for your business.

Check your NJ LLC name for existing trademarks

When the state checks to see if your name is available, they don’t take trademarks into account. If you fail to check to see that your desired name isn’t trademarked by someone else, you could later (after you’ve put up signs, printed business cards, etc.) be served with a cease and desist letter, forcing you to rename your company.

Trademarks can be federal or state. You can visit the United States Patent and Trademark Office website to see whether your business name or logo is federally trademarked. You can also apply for your own trademark, but this is a long, involved process at the federal level.

State trademarks apply only within your state’s borders, but they’re less expensive and easier to get. The NJ Division of Revenue and Enterprise Services website has a search engine for checking state trademarks, along with instructions for applying for your own trademark.

Secure a domain name for your business website

Before you make the final decision on your LLC name, think about whether you can find a domain name that works well with it. Even if you don’t sell anything online, you’ll likely want customers to be able to find you on the web. If you think your website will be especially important to your business and marketing, the available domain names could have an influence on what you ultimately name your company.

So, as you’re brainstorming business name ideas, you can do a domain name search to verify that you’ll be able to create a good website name, as well. Our domain name registration service can help you secure the online name that will best serve your company.

Is your New Jersey LLC name available as a web domain?

Even if you don’t sell your goods or services online, you’re going to want a presence on the web. At the very least, you want your company’s name, address, and contact info to pop up when people search for it.

That’s why it’s important to get a domain name that pairs well with your business name. You’re likely going to be putting that URL on your business cards and other marketing materials, and you want people to be able to remember it and associate it with your business.

The ideal domain name for your company may already be taken, but you can still find others. In fact, if you find a perfect available domain name, it might be worth naming your business after that URL rather than the other way around.

We have a domain name search tool you can use to see if your desired business name or something similar is available as a URL. If you find such a domain name, you might want to lock it down before someone else does.

You may also consider checking to see what social media handles are available. Many businesses market on platforms like Instagram, Facebook, and Pinterest, so getting the appropriate social media names can help your online marketing efforts.

Our domain name service can help you find and purchase a domain name for your business. We can also help you create a business website and provide domain name privacy.

Reserving a Business Name for Your New Jersey LLC

If you’ve found an available business name for your LLC but aren’t quite ready to file the rest of your LLC paperwork, you have the option of reserving it. By completing a form and paying a filing fee, you can reserve your LLC’s name for 120 days.

Filing for an Alternate Name in New Jersey

If you plan on doing business under a name other than your official business name — for example, if you want to separate different services under different titles or advertise under a name that doesn’t include the required “LLC” after the title — you can also file a New Jersey Alternate Business Name form after your business is registered with the state. This is another task we can handle for you with our DBA service.

2. Appoint a registered agent in New Jersey

Select a registered agent for your New Jersey LLC. The state of New Jersey requires that every LLC have a registered agent for service of process. Service of process is the fancy term for the delivery of legal papers that might be headed your way, such as subpoenas.

A registered agent in New Jersey can be an individual or business entity. The key requirement is that they have a physical address in New Jersey and agree to receive and forward legal notices to you.

In New Jersey, a registered agent must:

• Be a person 18 years old or more, or a domestic or foreign (out-of-state) corporation authorized to do business in New Jersey.
• Have a “registered office” in New Jersey with a physical street address (not a P.O. box or something similar). This doesn’t need to be your business’s address, but it can be.
• Be available during normal business hours to accept legal notices in person.

Using a Registered Agent Service in NJ

You can choose to be your own registered agent, but there are definite advantages to using a registered agent service like ours:

• Discreet receipt of legal notices (as opposed to being served with a lawsuit in front of a client)
• Ability to move your office location without having to update your registered agent address with the state
• Freedom to leave the office, as the registered agent must be present at the office during all normal business hours

What if the state can’t find my New Jersey registered agent?

Serving as your own registered agent or appointing a friend or family member to be your agent might seem the simplest way to meet the New Jersey registered agent requirement. But consider what could happen if a process server is unable to find you or your appointed agent.

This could occur if you or your appointee isn’t in the office (for example, meeting a client, on vacation, sick, etc.) when someone needs to reach the agent. It can also happen if the agent moves or quits and you forget to update your registered agent name and address with the state.

In addition to legal penalties for being out of compliance, failing to maintain a registered agent could mean that a process server can’t find you to notify you of a lawsuit. In that scenario, a court case against you could actually go forward without your knowledge, meaning you wouldn’t even have a chance to defend yourself in court.

ZenBusiness can provide your registered agent

When you sign up for our registered agent service, we’ll provide you with a registered agent in New Jersey, meaning there will always be someone available to receive important legal notices. 

This keeps you in compliance with the registered agent statutes, and it avoids embarrassing scenarios where you could be served papers for a lawsuit in front of clients.

Our registered agent service also keeps you organized. When you get important documents, we will quickly inform you and keep them together in your online “dashboard.” From this dashboard, you can view, download, and/or print them whenever you want instead of digging through piles of papers to try to find misplaced critical documents.

3. File New Jersey Certificate of Formation

File your Certificate of Formation. To officially create your LLC in NJ, you’ll need to complete the Certificate of Formation paperwork online and have it approved by the Division of Revenue and Enterprise Services. Filing official government documents like this can be intimidating and/or complicated for many people, which is why we’re here.

With our business formation plans, our professionals handle the filing for you to make sure it’s done quickly and correctly the first time. But, although we can handle this for you, we’ll show you how the process works below.

Obtain an EIN

New Jersey is different from most states in that it requires you to get an Employer Identification Number (EIN) from the Internal Revenue Service before you complete your Certificate of Formation. We cover how to get an EIN in Step 5 below.

NJ LLC Registration

On the Division of Revenue and Enterprise Services website, you’ll be asked to choose your business type and enter your business name. In addition to other required information, you’ll have the option of including a description of your business purpose.

The state charges a filing fee of $125 (at the time of this writing) for your Certificate of Formation. Check the Division of Revenue and Enterprise Services website for the latest fee schedule. Additional charges apply for using a credit card or eCheck.

Provide information for your LLC in NJ

To complete the online forms, you’ll need to provide the following information. New Jersey uses the same form for multiple types of business entities. Note that the information you submit here will become public record.

• Business name and type
• Registered agent information (including an email address to receive registered agent notifications)
• Names of all members (owners)
• If you’re a foreign (out-of-state) entity, a Standing Certificate from your home state
• Credit card or eCheck (an electronic version of a paper check used to make online payments)

After you file the Certificate of Formation, you’re required to register to pay state taxes by filing a state tax/employer registration form (Form NJ-REG). You must register the NJ-REG online within 60 days of filing your Certificate of Formation and at least 15 business days prior to opening your business.

Once you’ve successfully completed the Certificate of Formation and Form NJ-REG, the state will send you a Business Registration Certificate (BRC) for public contracting and applying for State grants and tax credits.

How to Amend Your Certificate of Formation

You need only file your Certificate of Formation once. But if any of the original Certificate of Formation information needs to be updated, altered, or expanded, your business is required to inform the state about the changes. You would report these changes by filing a New Jersey Certificate of Amendment and paying a filing fee. 

Do you need help amending your Certificate of Formation? We have an amendment filing service that can handle it for you, as well as our Worry-Free Compliance service, which includes two amendment filings every year.

Keep your NJ LLC formation documents organized

If you have us handle filing your Certificate of Formation, once the state approves your LLC, your paperwork will be available from your ZenBusiness dashboard, where you can keep it and other important paperwork digitally stored and organized.

Once you get your physical paperwork back from the state approving your new LLC, you’ll want to keep it in a safe location along with your other important documents, such as your LLC operating agreement, member certificates, contracts, compliance checklists, transfer ledger, etc.

We offer a customized business kit to help you keep these important documents organized and looking professional.

4. Create an Operating Agreement

Establish the rules for your LLC with an operating agreement. An operating agreement is a critical document for an LLC. It spells out the details involved in the day-to-day operations of your business and also puts into writing things like who owns what percentage of the business, how profits are distributed, and how decisions are made.

Creating an operating agreement in New Jersey helps set the ground rules for you and your business partners before your business takes off. It helps you avoid disagreements and make clear decisions.

Although operating agreements are not strictly required for New Jersey LLCs, they’re definitely recommended. Among the many benefits of having an operating agreement for your LLC in NJ are:

• Further protection of personal assets: By clarifying in writing which assets and affairs are tied to the business, you add another layer of legal protection between business and personal affairs should anyone try to question it in court.
• Clearly defined rules: In the absence of an operating agreement, the state of New Jersey has its own rules for how things work in an LLC. If you want to avoid the default rules, you’ll need an agreement to clarify how your company should run.
• Assigning ownership: The agreement can spell out what percentage of the company each member owns, including what they contributed in capital and how any profits should be shared. This can help avoid future disagreements with the other members.
• Succession and dissolution: The agreement can also include explicit details about who gets your share of the business if something happens to you and how things will be divided up if the business dissolves.
• Business funding: Sometimes, to get business loans or lines of credit, a bank will want to see an operating agreement to make sure you’ve given your business some serious thought.
• Mindset: Creating an operating agreement gets you in the right mindset to start a business. It forces you to think about different scenarios and plan accordingly.

A good operating agreement may include the following:

• Details of the LLC: Business name, members, registered agent, and so on. This is any information that was included in the Certificate of Formation when you registered your business.
• Capital contributions: This is a record of how much money each member contributed to starting the business. These numbers are often relevant when determining how profits are to be divided.
• Distribution of profits: Perhaps the distribution of profits should be proportional to capital contributions, or maybe you and the other members want a different plan.
• Ownership percentages: Do all members own an equal percentage? Or is ownership proportional to capital contribution? You can spell this out clearly in the agreement.
• Books, records, and tax returns: Here you can clarify who maintains the books and how taxes are accounted for and prepared.
• Bank accounts: This is information about the company bank accounts and who has access.
• Management structure and voting: Who’s in charge? How are decisions made? If there’s a disagreement, does a majority rule, or do some votes count more than others? If there’s a tie, who breaks it?
• How changes in membership are handled: If someone wants to leave, are they paid a certain percentage of the business value? How will the members decide if and when to add someone new? If a member dies, does their ownership transfer to their next of kin?
• Dissolution and liquidation: If the business dissolves, how will assets and debts be split up? What will be the process?
• Arbitration: How will disagreements and disputes be handled?

NJ LLC Operating Agreement Template

An operating agreement is considered a legally binding document in the state of New Jersey. This means it should be drafted carefully. If you’re unsure as to how to start creating an operating agreement for your LLC, we offer a customizable template to help get you started.

All NJ LLC members must sign the operating agreement

Once you have finalized your operating agreement and it’s time for all members to sign, you should have the signatures notarized. This secures the legal foundation of the agreement. You do not, however, need to file the finalized agreement with the Secretary of State or any other agency. You just need to keep it in a secure location with any other business-related documents.

Do I need an operating agreement if I’m the only owner?

Most of the things in a standard operating agreement seem intended to avoid disputes among the LLC members, so we understand why you might think you don’t need one if your LLC only has one member. But potential investors, future business partners, and others may want to see your operating agreement regardless.

Your operating agreement can also spell out what you want to happen to the business and its assets if you die or become incapacitated.

Another thing to consider: Sometimes someone will take an LLC owner to court to try to prove that the owner and the LLC are the same entity so that they can go after the owner’s personal assets. If that happens, having an operating agreement in place is one more thing to further demonstrate to the court that the business owner and the LLC truly are separate.

5. Apply for an EIN

Request an Employer Identification Number (EIN). You’ll need to have this unique tax ID number (also called a Federal Tax Identification Number) before completing your Certificate of Formation. It’s used for paying federal taxes, and you’ll likely also need one to open a business bank account.

You can get your New Jersey LLC’s EIN through the IRS website, by mail, or by fax, but if you’re unfond of dealing with that particular government agency, we can get it for you. Our EIN service is quick and eliminates the hassle.

Can filing as an S corp lower my taxes?

One of the main advantages of the LLC business structure is the flexibility it gives you over a corporation. One of those flexibilities is how you can choose to have your LLC taxed.

An LLC has pass-through taxation by default. This appeals to most owners of LLCs because it avoids “double taxation,” in which a corporation pays taxes at both the business level and again when the income is paid to the individual owners. But some LLCs opt to be taxed as a C corporation or an S corporation because, in their case, it works to their advantage.

Being taxed as a C corporation does mean you get double taxation, but, for certain LLCs, the pros can sometimes outweigh the cons. One benefit is that C corporations have the widest range of tax deductions, which could be an advantage in some scenarios, especially for more profitable LLCs. For example, insurance premiums can be written off as a business expense.

A Subchapter S Corporation, known as an “S corp,” is a tax status geared toward small businesses. Having your LLC taxed as an S corp has pass-through taxation like a standard LLC, but there’s another potential advantage for some LLCs: It could reduce your self-employment taxes. 

Self-employment taxes are the portion of your taxes that pay for Social Security and Medicare. In a typical LLC, you would pay these on all of your profits.

But filing as an S corp allows you to be an “employee-owner” and split the income you get from your LLC into two sources, your salary and your share of the company’s profits. In this way, you pay employment taxes on your salary, but not self-employment taxes on your profits. (You’ll still pay the other applicable taxes on your LLC profits, of course.)

The drawback is that the Internal Revenue Service scrutinizes S corps more closely, meaning you’re more likely to get audited. S corps also have more restrictions for qualifying.

While it’s possible that one of the above options could work better for your LLC, remember that business taxes are very, very complicated. They’re also very specific to your situation. That’s why you truly need to consult a tax professional to see which taxing method works best for your Jersey business.

If you decide to form your LLC with an S corp status, our S corp service can help you do that.

Open a business bank account

Once you’ve secured an EIN, you’ll be able to open a business bank account. Having separate accounts for your business and your personal banking is critical for sorting out your finances at tax time and helps you avoid commingling funds.

Commingling funds makes your doing your taxes more difficult, but it could also be used against you if someone takes you to court to challenge whether you and your LLC are truly separate entities.

We offer a discounted bank account for your new business. This allows for unlimited transactions, online banking, a debit card, and more. When you want to authorize others in your business to use the account, we offer a banking resolution template to simplify the process.

For further help managing your new business’s finances, try ZenBusiness Money. It can help you create invoices, receive payments, transfer money, and manage clients all in one place.

For Employers

If you plan to hire employees for your business, you’ll need to take some additional steps. After verifying that an employee is able to work in the U.S., you must report the new hire to the New Jersey Child Support Employer Services Portal.

You’ll have to register for Unemployment Insurance Tax and Employee Withholding Tax on the New Jersey Department of Revenue website. You’re also responsible for providing workers’ compensation insurance for your employees and putting up any required workplace compliance posters.

The online State of New Jersey’s Employer Handbook on the Department of Labor and Workforce Development website has a lot of helpful information for employers.

File Annual Reports

All New Jersey LLCs must file an annual report with the New Jersey Division of Revenue and Enterprise Services. This annual report is intended to keep the state’s information on your business current.

The annual report requires a filing fee and is due every year on the last day of the month in which you completed your business formation. The state could dissolve your LLC if you fail to file your annual report on time. We have an annual report service to help you keep on top of this filing.