How to Start an LLC in New York | Mid 2023 Update

xStarting a Limited Liability Company (LLC) in New York provides entrepreneurs a blend of personal liability protection, potential tax advantages, and management flexibility. The Empire State, known for its vibrant business ecosystem, offers a straightforward formation process. This article guides you through the steps to establish an LLC in New York, from picking an LLC name to understanding state-specific requirements. By the end of this article, you will know how to start an LLC in New York.

Whether you are looking to start this LLC to develop a family office the Familoff way, or if you are just looking to start a business, let this guide lead the way.

How to Start an LLC in New York: Step-by-Step Guide

Creating a New York LLC involves several essential steps to ensure compliance with state regulations. In this guide, you’ll find a detailed overview of the process for forming a New York LLC, including choosing a name, appointing a registered agent, filing the Articles of Organization, creating an operating agreement, obtaining an EIN, complying with tax and regulatory requirements, maintaining your LLC, and outsourcing LLC creation.

Choose a Name for Your New York LLC

Choosing a name is a crucial first step in the process of forming your LLC. This name will be the identity of your business and it creates the first impression for your potential customers.

In New York, an LLC name must be distinguishable and should not confuse with any other business name already on file with the New York Department of State. It must include “Limited Liability Company” or an abbreviation like “LLC” or “L.L.C.”

You can check the availability of your proposed name on the New York Department of State’s business database. If the name is available and you are not ready to file, you may reserve it for 60 days for a fee of $20.

Consider checking if a corresponding domain name is available if you plan to create a business website.

Appoint a Registered Agent in New York

New York state law requires that every LLC must designate the New York Secretary of State as its agent for service of process. The state will forward all legal correspondence to the LLC’s principal business location. However, many LLCs also opt to appoint an additional registered agent—either an individual residing in the state or a business authorized to operate in New York—with a physical street address in New York.

File New York LLC Articles of Organization

fficially forming your LLC involves filing the Articles of Organization with the New York Department of State. This can be done online or by mail and comes with a filing fee of $200. The Articles of Organization should include:

  • The LLC name
  • The county within New York State in which the LLC will be located
  • A statement that the New York Secretary of State is designated as an agent for service of process
  • The LLC’s purpose
  • Information about how the LLC will be managed

Create an Operating Agreement for Your New York LLC

New York uniquely requires LLCs to adopt a written operating agreement. This agreement should be in place within 90 days of filing the Articles of Organization. It outlines the ownership structure and operating procedures of the LLC and helps in preserving your limited liability status, preventing financial and managerial misunderstandings, and ensuring your business operates under your own rules—not default state laws.

New York requires newly-formed LLCs to publish a copy of the Articles of Organization or a notice related to the formation of the LLC in two newspapers—one daily and one weekly—in the county of the LLC’s location, for six consecutive weeks. The newspapers must be designated by the county clerk. Once the publications have been made, the newspapers will provide you with an affidavit of publication.

You must then submit a Certificate of Publication, along with the affidavits, to the Department of State. The filing fee is $50.

Obtain an EIN for Your New York LLC

An EIN, also known as a Federal Tax Identification Number, is required by the IRS for tax purposes. It’s essentially the social security number for your business and is needed for filing federal and state taxes, opening a business bank account, and hiring employees. The EIN can be obtained from the IRS free of charge, either online or by mail.

Comply with New York LLC Tax and Regulatory Requirements

Depending on the nature of your LLC, you may need to register for one or more types of state tax. This could include:

  • Sales Tax: If your LLC will sell goods to customers in New York, you may need to collect and pay sales tax. This requires registering with the New York Department of Taxation and Finance.
  • Employer Taxes: If your LLC has employees, you’ll need to register for Unemployment Insurance Tax and Employee Withholding Tax with the New York Department of Labor and New York Department of Taxation and Finance respectively.

New York requires LLCs to file a Biennial Statement every two years with the Department of State. The statement is due by the end of the calendar month in which the LLC’s original Articles of Organization were filed. The fee is $9.

Maintain Your New York LLC

In addition to the above steps, your New York LLC may need to comply with other regulations, including:

  • Business Licenses and Permits: Depending on its location and the type of business, your LLC may need to obtain other local and state business licenses or permits.
  • New York Employer Requirements: If your LLC has employees, there are additional requirements regarding wage and labor practices, insurance coverages (like workers’ compensation and unemployment insurance), and more.

Starting an LLC is an exciting step towards entrepreneurship, but it also comes with legal and financial intricacies. Enlisting the help of professionals, like an attorney or a certified public accountant, can be helpful in navigating the setup process and maintaining compliance with state laws.

Outsourcing New York LLC Creation

While forming a New York LLC on your own is doable, many entrepreneurs choose to outsource the process to professional services such as LegalZoom, Incfile, or ZenBusiness. These services can simplify the LLC formation process and save you time, allowing you to focus on growing your business.

Outsourcing LLC creation offers several benefits:

  • Expertise: Professional services are well-versed in state requirements and can help you avoid common pitfalls and errors.
  • Convenience: They will handle the paperwork, filings, and interactions with the state on your behalf, ensuring all necessary steps are completed.
  • Registered agent services: Many LLC formation services also offer registered agent services, providing you with a reliable and experienced registered agent for your LLC.
  • Ongoing support: Most services offer ongoing support and assistance with maintaining your LLC, including compliance reminders and annual report filing.

When choosing an LLC formation service, compare pricing, features, and customer reviews to find the best fit for your needs. Keep in mind that the cost of using a professional service will be in addition to the state filing fees.

Final Thoughts on How to Start an LLC in New York

Starting an LLC in New York offers a mix of liability protection, tax advantages, and management flexibility, making it an appealing option for business owners. Ensuring the correct formation process and adherence to state requirements is essential for the longevity and success of your LLC. Remember, seeking professional advice can help you make informed decisions best suited to your business needs.

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