NY Business Corporation Law: Everything You Need to Know
NY business corporation law is the incorporation statute in the state of New York. 3 min read
2. Frequently Asked Questions
3. What is a Professional Service Corporation?
4. Steps to Incorporate in New York
What Is NY Business Corporation Law?
NY business corporation law is the incorporation statute in the state of New York. Corporations are separate entities from the people that start, own, and manage the business. A corporation can be formed to complete lawful business purposes. Corporations are just one of the business types recognized by the State of New York. Other types of businesses recognized by the State of New York include the following:
- Sole Proprietorships
- Limited Partnerships
- Limited Liability Companies (LLCs)
- Not-for-Profit Corporations
Corporations in New York have benefits that other businesses enterprises lack. For instance, corporations have the rights that people have as well as other rights that are specific to corporations. These benefits include reducing liability from the business to its owner, perpetual duration to last until closed or acquired, and the ease of transferring interests to another party.
Frequently Asked Questions
Do I have to incorporate on the state level? Is there an option to incorporate nationally?
Currently, there is no way to incorporate nationally. Each business needs to choose a state to incorporate in.
Who maintains each corporation's by-laws and record books?
Each corporation must maintain its own records for its by-laws and corporate books internally. The Department of State does not retain copies of each corporation's required documentation.
Does my corporation name need to be unique?
New York's Division of Corporation will reject any company name that is not distinguishable from other existing business names that have been filed. New corporations, LLCs, and partnerships are required to make a name availability inquiry through the State to ensure that their preferred name is available before taking the steps to incorporate. Don't rely on online database search information to see if a corporation name is available, as the information may not be accurate or complete.
Do I need a corporate seal? Where can I get a corporate kit?
According to New York State law, your corporation does not have to have a seal. However, you can purchase a corporate kit from a legal stationery store. These kits typically include a corporate seal, by-law adoption forms, meeting minute forms, and blank stock certificates.
How do I get a copy of filed documents from the State of New York's Division of Corporations?
You can request a copy of corporate documents with a written request. Make sure your request includes the following:
- Your corporation name
- DOS ID number
- Date of business formation
- List of documents you need
- Whether you need plain or certified copies
- Mailing address
What is a Professional Service Corporation?
A Professional Service Corporation is formed by licensed professionals, such as doctors and lawyers, by filing a Certification of Incorporation in the State of New York, pursuant to Section 1503.
Steps to Incorporate in New York
- Choose a corporation name. Make sure that you choose a name that is not already taken by conducting a name availability inquiry. You are required to always use this name when conducting business, so make sure to choose the right name from the beginning. Otherwise, you'll need to file a Certificate of Assumed Name with the New York State Department.
- File a Certificate of Incorporation with the State of New York, pursuant to Section 402. Your corporation exists once you file this document with the state.
- Apply for a Taxpayer Identification Number through the Internal Revenue Service. The corporation needs this number to file taxes and to hire employees or contractors.
- Meet with other incorporators or executive board members. You will need to adopt by-laws, elect corporate directors, and other business matters. These initial by-laws need to be adopted at a business meeting.
- Maintain accurate records, including meeting minutes from all business meetings. If your corporation has shareholders, a record of their names and addresses, as well as when they became shareholders, must be maintained. If your corporation has shareholders, an annual shareholder meeting must be scheduled to elect directors and to conduct any other business that impacts the shareholders.
- Pay business taxes each year, starting with the year the corporation was formed. The corporation will have tax liability until it is legally dissolved, which required the Secretary of State to dissolve it. If operating a franchise, you'll need to file your franchise tax reports and pay the required taxes annually even if the corporation doesn't make money.
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