New York LLC formation can often seem intimidating due to state requirements that an advertisement announcing the New York LLC formation must be placed in the local newspaper. You will have to file Articles of Organization at a fee of $200 with the New York Department of State Division of Corporation either online or through the mail.
When trying to navigate the state’s regulations, it is a good idea to create a team of business and legal professionals around you that can assist in making this process easier. However, for small businesses, this might not be financially viable and so this easy-to-follow 5-step guide is all you need to form an LLC in the state of New York.
Step 1: Decide on a New York LLC Name
New York has certain naming guidelines to follow when choosing an LLC name. They are:
- The name must include “Limited Liability Company” or one of the abbreviations “L.L.C.” or “LLC”.
- Words that imply government agencies are not allowed for example “Treasury” or “State Department”.
- Words that require special licensing are not allowed, for example, “Attorney”, Architecture” or “University”.
- The name must be unique and distinguishable from already registered companies in the state.
The New York Senate website provides additional naming guidelines. Registered names can also be searched online or through the State of New York website at a cost of $5 per name searched. It is recommended that the domain name is also available to start a company website.
Step 2: Appoint a New York Registered Agent
As a default, the New York Secretary of State acts as a registered agent for the LLC, however, it is wise to appoint an additional individual or business entity in addition to the State Secretary.
The owner of the LLC can serve as the registered agent and the state will forward the legal documents to the principal address specified for the LLC.
Step 3: Sign and File Articles of Organization
In order for the LLC to be officially registered, Form DOS 1336-f: Articles of Organization with the New York Department of State must be filed. This is also the time to decide whether the LLC will be member-managed or manager-managed.
The articles take around 3-5 business days to approve and will be available online immediately after the approval.
Step 4: Comply with State Regulations
Every state has its own unique guidelines and regulations. In New York, the following may be required:
- Business Permit: New York State’s Business Express Wizard is a tool to check whether a particular industry and type of business, such as health care professionals, require a specialized permit in order to trade.
- Obtain an EIN: An EIN is like a social security number for the LLC and will allow the LLC to file for state taxes. It is issued by the IRS and can be applied online. The LLC will also require an EIN to employ staff in the future.
Ensure that the relevant state and federal taxes are registered. More information can be found on the Secretary of State’s website.
Step 5: Publish Notice of the New York LLC Formation
The Articles of Organization or a notice of LLC formation must be advertised in two newspapers. One weekly and one daily for six consecutive weeks so be sure to plan ahead for this expense. This must be done within 120 days of the LLC is registered successfully.
After Forming a New York LLC
Once the New York LLC formation is complete, there are additional processes to consider to assist in the daily operations of the business.
Create an Operating Agreement – Although not required by state law, it is highly advisable as the agreement builds a solid foundation for business operations. It will include member responsibilities, profit, and loss divisions as well as any legal clauses and rules.
A business is wise to open a business bank account with business credit. This will ensure finances can be easily tracked and managed for tax purposes.
Lastly, be sure to protect the LLC by obtaining trademarks for the name and logo as well as purchasing business insurance to protect against any unforeseen circumstances.