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Last Updated: 1/16/24
Have you decided that it’s finally time to set up your business in New York? With its vast population and vibrant culture, the Empire State offers a ton of opportunity. It’s no wonder why New York is home to so many small businesses.
One of the more popular legal business entities is the limited liability company (LLC). Dealing with the intricacies of starting a New York LLC can be about as overwhelming as dealing with traffic on the Long Island Expressway. Don’t worry, though, because we have a detailed, step-by-step guide on how to start an LLC in New York.
LLC requirements vary state by state so it’s important that you are well-versed in New York laws before proceeding. Generally, it comes down to these steps:
Starting an LLC in New York is relatively straightforward with our six-step guide. It covers exactly what you’ll need to do. As you check off each task, you’ll be one step closer to getting your New York LLC up and running!
You’ll first need to name your New York LLC. You’ve more than likely already given this some thought. Keep in mind that your LLC’s name can have big implications.
While you can always change a business name in the future, it’s best to pick one that will fit for years. You’ll want to pick a name that’s easy to remember and resonates with your customers.
New York State has laws for naming an LLC that you can find on the Department of State’s website. Here’s a rundown of what to know according to New York Limited Liability Company Law § 204. We’ll be highlighting points that may be considered most important:
After you’ve chosen a name, make sure it isn’t taken. You can do this by using our New York business entity search tool. If everything looks good and the name you’ve chosen is available, you’ll next want to reserve it while you get your LLC set up.
In New York, you can reserve an LLC name to ensure that it’s available for your use when you’re ready to officially form your LLC. Reserving an LLC name in New York involves a straightforward process to secure the name you desire for your future LLC. To begin, conduct a name availability search on the New York Department of State’s Division of Corporations website to ensure that your desired name is unique and available for reservation. Once confirmed, download and complete an Application for Reservation of Name form, providing accurate information regarding your proposed LLC name and your contact details.
Alongside your application, prepare the required filing fee, which is $20 as of this writing (fees may vary, so verify the current amount on the New York Department of State’s website). Submit your application, either by mail or through available online filing options, to the designated address indicated on the form. After processing, your name reservation will generally be valid for 60 days, with the option to renew for additional 60-day periods if needed. It’s crucial to monitor the reservation’s status and expiration date, ensuring that you retain exclusive rights to your chosen name while you prepare to formally establish your New York LLC.
You can learn more about reserving your LLC name on the New York Department of State website.
This is also the perfect time to think about how your business name will translate on the internet. A domain name is your website address and can be used for your company email address, too.
You’ll want your domain name to be as close to your New York limited liability company’s name as possible to easily identify yourself.
Our domain name service can help you find and purchase a name for your LLC. In addition to all of this, we can also help you build a business website and provide domain name privacy. Once you get your business website up and running, you can reach a new group of customers online and promote the site through social media.
Once your New York LLC is registered with the state, you can do business under that name. However, if you plan to do business under a variation of that name or an entirely different name, you’ll need to file a Certificate of Assumed Name with the state.
An “assumed name,” also known as a New York DBA name, can be filed in New York for a fee or you can let us file it for you. The state recommends that the assumed name document be completed under the guidance of an attorney.
Another thing to consider is trademarking your limited liability company’s name in New York. Although trademarking isn’t required, it can add an extra level of protection that prevents other businesses from using your name.
Trademarks can be registered at the state and federal level:
You should also conduct a trademark search to make sure the name you want isn’t already trademarked.
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In New York, the Secretary of State acts as the registered agent for every New York LLC by default. This is required by state law. However, you can add an additional registered agent in your Articles of Organization.
New York state law (NY LLC § 302) says that if you’re appointing a registered agent, the agent must be:
If you’d rather be your own registered agent, you can, but there are some things to consider.
In accordance with New York law, the Secretary of State is named as an LLC’s registered agent by default. However, if you’d like, you can name an additional one in your Articles of Organization. You can even name yourself as your LLC’s registered agent but this responsibility may be best for someone else.
If your registered agent ever has to change their address, they’ll need to file a Certificate of Change of Address of Registered Agent in accordance with Chapter 4, Article 8, Section 805-A of the state’s Business Corporation Law. This is for domestic companies.
Knowing that the state will take care of delivering legal notices to you, why would you want to use a registered agent service like ours instead? Well, there are a few reasons:
File your Articles of Organization with the New York Department of State’s Division of Corporations, State Records, and Uniform Commercial Code.
Now that you’ve selected a name, you need to register your New York LLC. Filing your New York Articles of Organization certificate legally forms your LLC in New York. It provides the government with vital information about your business for the state’s records. The certificate acts as proof that your LLC was formed and exists as a business entity.
Filing official government documents like this can be confusing, which is why we’re here. With our business filing service options, we can handle the filing for you to make sure it’s done quickly and correctly the first time.
You can file your Articles of Organization online, and many would argue it’s easier and faster. In order to do this, you’ll need to create a NY.gov account on New York’s Business Express website and pay a $205 fee. If you’d prefer to do so via mail, that option is also available.
In order to complete the Articles of Organization for your New York limited liability company, you’ll need to include the following information:
Check out the state of New York’s official page for forming a limited liability company for more information.
In New York, you have the option to make your LLC either member-managed or manager-managed. New York LLCs are automatically member-managed unless otherwise stated in their Articles of Organization in accordance with New York Limited Liability Company Law Chapter 34, Article 4, Section 401.
A member-managed LLC simply means that the members participate in the operation and management of the company. In a manager-managed LLC, the decision-making authority is granted to a manager. This person or persons may or may not be members of the LLC.
It’s best to discuss this topic with a business attorney for a clearer understanding of how it works.
The average processing time in New York for an LLC’s Articles of Organization is typically seven business days. However, you can expedite this service for an additional fee with the Division of Corporations. The fee will depend on the processing time needed:
Payments must be made by check to the Department of State. Handling fees for expedited service are not required for online filing.
In accordance with New York LLC Law Chapter 34, Article 2, Section 203, an LLC is officially formed at the time that its Articles of Organization are filed with the Department of State or any later time specified in the Articles not exceeding 60 days from the date they were filed.
The state recognizes the Articles of Organization to be “conclusive evidence of the formation of the limited liability company as of the time of filing or effective date if later, except in an action or special proceeding brought by the attorney general.”
If they don’t need or want their company formed right away, some entrepreneurs select a future filing date in order to save time and money on biennial reports and tax filings by waiting until January 1 of the coming year. This is to avoid having to file taxes on the LLC in the current calendar year.
We offer a delayed filing service that’s quite simple to use. You’ll get the option of delaying your LLC’s effective date for an extra fee. Note that this service is only available from October to January.
If you have us handle filing your Articles of Organization, 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 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 operating agreement, member certificates, contracts, compliance checklists, transfer ledger, etc.
Draft an operating agreement to detail how your New York LLC will be organized and run. A New York LLC operating agreement (OA) is a legally binding document that all members of an LLC agree on and sign.
According to New York’s LLC law, your LLC operating agreement can be entered into by members before, at the time of, or within 90 days of your Articles of Organization being filed.
This agreement outlines the rules, regulations, and procedures of your business operations. New York is one of the few states that legally require an OA to be drafted for an LLC.
If dealing with more paperwork sounds like a chore, then consider a few benefits of having an OA:
If you’re wondering what to include in the OA for your New York LLC, you can start with the following:
You should also know that if you plan to dissolve the LLC, you’ll need to file Articles of Dissolution with the Department of State for a fee of $60.
✓ If you want to create an operating agreement but aren’t sure how to get started, then check out this guide. Make note that, if you decide to form your LLC with ZenBusiness, our plans include a customizable operating agreement template to save you time researching and crafting the agreement yourself.
If you happen to be the only owner of the LLC, you may think that an OA isn’t needed because, as the single owner, no one else will participate in the company’s operation. However, even if you’re the only owner, by law in New York, you still need to have an OA in place.
Along with the benefits mentioned above about having an OA, as a single member, you can lay out what’s to happen to the LLC if you die or become incapacitated and are the only member. You can grant ownership of the company to someone else or have it dissolved upon your death or incapacitation.
Apply for an Employer Identification Number (EIN) to register your LLC with the federal government. You’ll have to do this with the Internal Revenue Service (IRS). An EIN is also known as a Federal Employer Identification Number (FEIN) and Federal Tax Identification Number.
An EIN is like a Social Security number for your business. Every New York LLC with employees or more than one member will need this nine-digit number. An EIN is required for tax purposes and financial paperwork, including filing New York state taxes, hiring new employees, and opening company bank accounts.
You can get your New York LLC’s EIN through the IRS website, by mail, or by fax. If you’d like to make things easier for yourself, you can use our EIN service.
Lastly, you’ll need to meet the state’s publication requirement for LLCs. Once you’ve successfully filed your Articles of Organization, New York LLCs are required to publish a notice about the LLC’s formation within 120 days of the LLC’s effective date.
The notice must be published once each week for six consecutive weeks in two separate newspapers (one with daily circulation and one with weekly circulation). Newspaper designations are determined by the county clerk. The notice should include:
After the final run of the publication notice, each newspaper will provide an Affidavit of Publication, which will need to be included with the Certificate of Publication. The Certificate of Publication needs to be submitted with the appropriate state filing fees to the Department of State for its review. Once approved, the Certificate of Publication package is returned with the state’s stamp of approval.
Costs typically range from $600-$1200 when you combine the New York county fees, newspaper advertising rates, and certificate filing fees.
If your business will be conducting sales that are subject to sales tax, then you’ll have to register with the New York Tax Department to obtain a Certificate of Authority. This certificate allows you to collect tax on these taxable sales. You can find more information on the state’s Department of Taxation and Finance website.
Once you’ve secured an EIN, you’ll be able to open a business bank account. It’s critical to separate your business and personal accounts since it sorts your finances come tax season. Using a single account for business and personal purposes can complicate your taxes and make it more difficult to differentiate yourself from your business.
The LLC model is one of the more popular ones due to its flexibility and tax benefits. LLCs are taxed as sole proprietorships if there’s only one member or as partnerships if there are multiple members. This can be an appealing feature because it avoids “double taxation.”
Double taxation involves paying taxes once at the business level and then again when income is paid to the company owners. LLCs can opt to be taxed as an S corporation (Subchapter S Corporation). Your LLC will still have pass-through taxation, and it can also offer the advantage of saving you money on self-employment taxes.
This allows you to be an “employee-owner.” You can split your income into your share of the company’s profits along with your salary. Doing this allows you to pay self-employment taxes on your salary but not your profits.
Two caveats of opting for an S corp status for your LLC are that this status is more difficult to get and you’ll catch some extra attention from the IRS, which has a tendency to scrutinize S corps closely.
You can find more tax-related information about New York S corporations on the state’s Department of Taxation and Finance website. As always, we encourage you to reach out to a tax professional for more information about how LLCs and S corporations are taxed.
Understanding the taxation of a New York LLC is crucial when setting up your business in the state. LLCs offer flexibility in how they can be taxed, making it essential to consider the most suitable tax structure for your specific situation.
Navigating the tax landscape for your New York LLC can be complex, and the choice of tax structure can significantly impact your financial responsibilities and benefits. To make informed decisions, it’s advisable to consult with a qualified tax professional who can assess your specific circumstances, help you understand the tax implications, and guide you toward the most tax-efficient approach for your LLC’s success.
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Starting a business of any kind in any industry isn’t easy, but we’ll do our best to help you. Let us take care of the hard work so you can focus on your business, whether you’re helping stressed financial workers from Wall Street plan their vacation or are selling the best pizza in the upstate region.
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New York currently has no statewide business license requirement. However, local governments may require businesses to have a general business license if operating in their jurisdiction. Keep in mind that certain businesses in certain industries may need additional licenses to operate legally within the county or state.
New York State requires businesses to obtain a Certificate of Authority if they plan to conduct sales that are subject to sales tax. You’ll have to apply for this certificate on New York’s Business Express website.
You’ll more than likely have to research which federal, state, and local licenses and permits your LLC will need to operate. We can streamline the process of discovering what licensing you need with our business license report service. This service provides a summarized report of what you’ll need to operate at these levels.
Starting a New York LLC begins with a $205 fee: $200 to file the Articles of Organization and a $5 paper copy fee. Remember that you’ll inevitably run into additional costs, like the costs of fulfilling the New York LLC publication requirements. Licenses, permits, certificates, trademarks, and more can also increase the cost.
On top of this, the time needed to put everything together to ensure your LLC’s filing goes smoothly can also be a lot. That’s where we come in. Our services can ease the process, letting you plan your success while we do the heavy lifting of ensuring your LLC is formed correctly.
Keep in mind that New York’s business formation fees can change, so stay up to date with the state’s requirements and prices.
LLCs are a very popular business model in New York for good reason. Forming one means you can enjoy the following:
For more information, read our guide about LLC protection in New York.
Like sole proprietorships and general partnerships, LLCs are “pass-through” entities. This means they aren’t subject to corporate taxes and, instead, the profits are passed to the owner’s personal income.
This person must then pay federal income taxes based on that. This is in contrast to most corporations, whose profits are taxed at the corporate level and again when they’re distributed to the individual shareholders.
Single-member LLCs assume the tax status of a disregarded entity, while multi-member LLCs assume the partnership’s tax status. A disregarded entity is a business with only one owner that isn’t considered separate from the owner for federal income tax purposes.
One thing to know about New York is that it imposes an annual filing fee for single-member and multi-member LLCs. Filing fees will differ for each entity as it is based on your LLC’s gross income from the previous tax year. If the LLC hasn’t earned income and has no gains, losses, or deductions from the state, then you won’t be required to pay a fee.
Additional tax information for New York LLCs includes:
Additionally, LLCs often elect to be taxed as an S corporation. This classification is typically more difficult to obtain and results in more scrutiny by the IRS. However, the effort may be well worth it since it can save a lot of money in self-employment taxes for certain LLCs. Double-taxation would still be avoided in this situation.
Our S corp service can help you if you want to form a New York LLC with S corp status.
The New York Department of Taxation and Finances website has more information about state taxes.
The typical processing time to process a New York LLC’s Articles of Organization is seven business days according to New York’s Business Express website. Expedited service is available, from same day processing to two-hour processing, for an extra fee.
New York does not require you to file an operating agreement with the state. However, you will be required by law to have an operating agreement for your records.
By default, the IRS will tax your LLC as a sole proprietorship, also known as a disregarded entity, if there is only one member. If there are multiple members, then it’ll be taxed as a general partnership by default. You also have the option of being taxed as a corporation.
S corporations, specifically, are an appealing tax status for some LLCs but do tend to get more attention from the IRS and are harder to obtain. Be sure to consult with an accountant to better help you understand and decide which tax structure is best for you.
New York does not allow a Series LLC option. A Series LLC consists of one main LLC under which other LLCs are formed. The main LLC controls the ones underneath it despite these entities being treated separately with their own assets and members.
If you decide to dissolve your LLC in New York, then you’ll be required to submit Articles of Dissolution with the Department of State. The articles must be filed within 90 days of deciding to dissolve or wind down service for your LLC.
In order to transfer ownership of your LLC in New York, you must detail in your operating agreement how this will take place. In general, you can transfer ownership of your LLC through two primary ways: a partial sale of your interest or a full sale of the company.
Other ways ownership can be transferred include the death of a member or the dissolution and reformation of the company. The state will also need to be informed if an ownership transfer occurs.
Yes, a “doing business as” name, known as an assumed name in New York, can be assigned to your LLC. You’ll have to file a Certificate of Assumed Name with the Department of State. Before settling on a name, you’ll have to make sure it isn’t already taken by another business.
Your operating agreement should detail how a member will be removed from the LLC along with the reasons for doing so. If it’s to be put to a vote, detail any requirements. Be sure to also outline how the removed member’s share will be handled. Will it be absorbed by the other members or sold to a new party?
Your Articles of Organization will also need to be updated with a Certificate of Amendment, filed with the Department of State. Your operating agreement will need to be updated with the changes following the removal of the member.
Yes, New York requires all LLCs to file a biennial report in accordance with Section 301(e) of the state’s Limited Liability Company Law. As the name suggests, a biennial report must be filed every two years with the Department of State. This is another task we can help you with using either our annual report service or Worry-Free Compliance service.
You aren’t required to have a business plan to form your New York LLC, but having one can be helpful. This plan can be used to outline how your company will be structured and what its short- and long-term goals are.
You should also consider including information about the LLC’s owners, any market research you’ve conducted, your marketing plan, an executive summary, and more. A business plan can also help you secure investors who’ll see that you’re serious about your business idea.
New York requires all new LLCs to publish an announcement about their formation in two newspapers for six consecutive weeks. This must be done within 120 days of the LLC’s formation.
After you’ve done this, each newspaper will provide an Affidavit of Publication. You’re then required to send the affidavits to the New York Division of Corporations with a completed New York Certificate of Publication form.
Disclaimer: The content on this page is for information purposes only and does not constitute legal, tax, or accounting advice. If you have specific questions about any of these topics, seek the counsel of a licensed professional.
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