Frequently Asked Questions Regarding Incorporating in New York
Incorporating your business in New York can be a daunting and complex task3 min read
Incorporating your business in New York can be a daunting and complex task. The process involves many factors, such as registering with the state government, finding a physical address, and in some cases, background checks on owners. Fortunately, with the right counsel, these steps can be handled efficiently and without a hassle.
Here are some of the frequently asked questions regarding incorporating in New York.
What Is Incorporating?
Incorporating is the process of creating a separate legal entity known as a corporation. This entity is responsible for its own debts, obligations, and legal proceedings, thereby protecting the members who formed the corporation from being held financially and legally liable.
What Are the Benefits of Incorporation?
There are a variety of business benefits when incorporating in New York, including:
• Personal liability protection: The corporation is a separate legal entity, so its owners are no longer personally liable for its debts and other obligations.
• Perpetual life span: A corporation has an indefinite life span, which means it can exist much longer than a human life span. Even if the owners of a corporation pass away, the corporation itself can continue to function without interruption.
• Tax benefits: Depending on the type of corporation, businesses may be eligible for tax breaks on their income, such as the federal corporate tax rate that is lower than the individual tax rate.
• Capital raising abilities: Corporations can raise capital to expand their operations with the sale of stock certificates, which can be used to attract new investors or take on debt.
What Are the Steps to Incorporating in New York?
The steps to incorporating in New York include the following:
• Choose the right legal structure: Decide on the type of corporation that best fits your business needs.
• Register with the state: Register your corporation with the New York State Government. You'll need to pick a business name and provide an address.
• Create corporate by-laws: Draft a set of corporate by-laws that governs the management of the corporation.
• Issue stock certificates: Issue shares of stock to the shareholders of the company.
• Obtain applicable licenses and permits: Make sure you comply with all applicable state and local laws. This may include obtaining business licenses and permits.
• Comply with taxation rules: Register for the proper state and federal taxes, such as income, sales, payroll, and unemployment taxes.
• File annual reports: File an annual report with the state to report on the status of the company and its finances.
Do I Need to Seek Legal Counsel When Incorporating in New York?
It is highly recommended that you consult with experienced legal counsel when incorporating in New York. An attorney can provide you with the necessary guidance to ensure all of the necessary steps are taken into consideration and to provide you with assistance in navigating the complex process of incorporation.
Fortunately, there are many firms that specialize in incorporation. Trustworthy companies like UpCounsel, for example, offer access to experienced business attorneys with years of experience in handling incorporation matters in the New York area. By consulting with a qualified counsel, you can ensure that all the necessary steps are taken care of and that your business is properly protected and covered should any legal problems arise.
Incorporating in New York is a complex process with various steps and regulations to take into account. With proper guidance from an experienced business lawyer, the process can be handled quickly and without any unforeseen obstacles.