NYS LLC Formation: Everything You Need to Know
When considering NYS LLC formation, there are many important factors to consider. 3 min read
When considering NYS LLC formation, there are many important factors to consider. New York State is an amazing place to start and build a company due to its rich culture, diverse cities, and a healthy economy. Starting your own business in New York State is easy and is even easier if your New York company is an LLC. An LLC is less expensive and comes with less hassle than forming a larger corporation.
Advantages of Forming an LLC in New York
There are many advantages to forming an LLC in New York including:
- Limited personal liability: An LLC provides owners with protection from liability for business debts or lawsuits.
- Ease of operation: Since LLCs have fewer rules and regulations than corporations, they are easier to run and require fewer meetings and paperwork.
- Easier tax preparation: LLCs have an easier time of filing, paying, and tracking their taxes and tax payments as taxes are most often reported on your personal return.
How to Form an LLC in New York
There are multiple steps to create an LLC in New York State. To be recognized by the state as an LLC and begin operating the business, you will need to:
1. Choose a Company Name
One of the most important steps in establishing your business is choosing your business name. It is important to do some research before choosing your company name to make sure that it will be a suitable name for your business venture as well as easily searchable by customers who will be looking for your product or services. There are some requirements and restrictions that you will have to follow when selecting a business name in the state of New York.
- You cannot use any prohibited or restricted words or phrases such as Bank, Attorney, or University which would require that there be a licensed professional that is part of your LLC.
- You must include Limited Liability Company, LLC, or Ltd. Liability Co. at the end of the name to make known your designation.
- You must not include anything that could cause confusion between your company and a state or federal agency.
- You must have a name distinguishable from other business entities that are already registered with the New York Department of State Division of Corporation.
While it is not necessary, it is good practice to find out website availability and email addresses with your company name before finalizing your selection. If you decide on a name but are not yet forming your LLC, you will be able to reserve your name for 60 days by filing an Application for Reservation of Name at the New York Department of State Division of Corporations. File the application by mailing it in and make sure to include the $20 filing fee.
2. Appoint a Registered Agent
In New York, the Secretary of State will act as the default registered agent and act as the forwarding agent for such legal papers as:
- Formation documents
- Any service of process
These items go to the LLC principal. Since the New York Secretary of State offers limited services, some LLCs find it beneficial to appoint another registered agent to handle and maintain legal LLC documents. To act as a registered agent for an LLC in New York, you must:
- Have a physical address where you can receive court process paperwork.
- Be available during the businesses regular hours to sign for any documents.
- Make your name part of the public record of the LLC by registering your name at the New York Secretary of State website.
- Must file any change of address with the Secretary of State's Office.
3. File Your Articles of Organization
Your Articles of Organization go on file with the New York State Department by utilizing form DOS-1336 and will need to include:
- The name of your LLC
- Your registered agent address
- Your taxpayer identification number
- Any necessary licenses and permits
- All members signatures
- A $200 filing fee
File your Articles of Organization online or by mail. They will take about three to four weeks to process by mail. E-filing is faster but requires an expedited processing fee.
4. Biennial Filing
The state of New York requires the filing of a biennial report with the Secretary of State due at the end of the month in which you formed your LLC. Failure to file on time can result in up to $250 in late fees.
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