New York LLC Filing Fee: Everything You Need to Know
The New York LLC filing fee is paid when prospective members file the articles of organization. There is also an annual filing fee, which is based on the gross income during the previous tax year.3 min read
2. Advantages of an LLC
3. Disadvantages of an LLC
4. How Do I Form an LLC?
5. What Is the Cost to Form an LLC?
6. How Much Does a New York LLC Cost Each Year?
The New York LLC filing fee is paid when prospective members file the articles of organization. There is also an annual filing fee, which is based on the gross income during the previous tax year. For example, if an LLC makes between $0 and $100,000, the annual filing fee is $25. This fee can go up to $4,500 for those who make $25,000,000+.
What Is a New York Limited Liability Company?
An LLC, or limited liability company, is a type of business entity that is created by the New York Limited Liability Company Law. Governed by New York Laws — Articles 1-14, LLC Law, an LLC is essentially a hybrid between a partnership and a corporation. Owners or "members" enjoy liability protection like a corporation, but the business operates more like a partnership. When forming an LLC, there is also no maximum number of allowed members.
Advantages of an LLC
There are numerous benefits associated with forming and operating an LLC, including:
- You are only expected to pay one level of tax — unlike a corporation, which pays corporate tax and another level of tax on all distributions.
- LLCs are very flexible, especially in terms of capitalization.
- Losses "pass through" to members. This reduces the tax owed on non-LLC income.
- At a later date, you can convert an LLC to a corporation with few consequences.
If you are considering the advantages of an LLC, you should also be aware of the disadvantages, including:
- LLC members are subject to self-employment tax related to all his/her LLC income.
- To avoid self-employment tax, many LLC members form an S-corporation for tax purposes. This can limit the amount of "salary" that each owner is paid.
- Following S corporation election, the IRS may characterize dividends.
How Do I Form an LLC?
If you are ready to form an LLC, there are a number of steps you'll need to take.
- Step one: Choose a name — Your unique name must include the words "limited liability company" or an abbreviation.
- Step two: File articles of organization — In New York, this is also known as Form DOS-1336.
- Step three: Publish formation of LLC — New York businesses must publish a copy of the articles of organization in which they filed for the state.
- Step four: Create an operating agreement — This document will outline each member's managerial and financial responsibilities. This is required within 90 days of formation.
What Is the Cost to Form an LLC?
When you initially file the articles of organization, there is a fee of $200. If you would like your paperwork to be processed within two days, there will be an additional fee of $75. There is also same-day processing available to those in need, as well as two-hour processing. The cost of these services is $125 and $200 respectively. You also have the option to fax your New York LLC filing, paying the associated $75 fee for two-day processing.
There are other fees also associated with LLC formation and operation, including:
- The filing fee for a certificate of publication will cost you $50.
- If you would a certified copy of your filed articles of organization, this costs $10. For an additional $25, there is a 24-hour expedited service for this copy request.
- The fee to publish notices is around $1299.
These fees can be paid in cash, by check, money order, Visa or MasterCard.
How Much Does a New York LLC Cost Each Year?
Each year, the New York Department requires that all LLCs file a biennial report. This is due on the last of the month in which you initially filed. In addition, you will need to pay a minimal fee of just $9 every two years.
If you are aware of the fees you need to pay and when you need to pay them, you can ensure that you remain in good standing. When you initially form your LLC, inquire about all of the filing fees that will be due throughout the life cycle of your business. This will help you plan accordingly and budget. If you have any specific questions or concerns, you should seek legal advice. This is particularly the case when an LLC has multiple members.
If you need help understanding New York LLC filing fees, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.