Setting Up an LLC in New York: A Guide for Executives
Forming an LLC in New York: Attention to Detail Required to Avoid Fines or More Paperwork3 min read
Forming a limited liability company (LLC) in New York requires attention to detail, as any misstep in the process can result in costly fines or additional paperwork. While most entrepreneurs who choose to limit their personal liability opt for the LLC structure, it’s important to become familiar with local regulations and potential pitfalls distinctive to New York before you take the plunge. This guide seeks to provide executive decision-makers with the tools they need to make launching an LLC in the Empire State an efficient, successful process.
Understand New York LLC Formation Overview
Before initiating the process of formation, familiarize yourself with the basic elements of New York LLCs:
Articles of Organization
Partners or Workers
Manager/Governor
Operating Agreement
EIN Number
Business Licenses
Articles of Organization
Articles of organization are legal documents filed with the New York Department of State that disclose your company name, address, contact information, and other details. A simple articles of organization document can usually be found online through the official site of the Secretary of State of New York; typically, the document does not need to be notarized. Once you fill out the required forms and pay the filing fee, the corporation must then wait at least 10 business days for the documents to be accepted before you may process any further steps.
Partners/Members
Once your articles of organization form is accepted, the next step is to determine who will serve as the LLC's partners or members. According to the New York State Business Corporation Law, LLCs must have at least one principal member and additional members or employees may be added to the LLC's roster. Your choice of partners or members will depend on the size and nature of your business.
Manager/Governor
A LLC is required to have a principal officer, who can be referred to as a manager or governor depending on the LLC's size and complexity. The manager or governor is responsible for ensuring the LLC meets all statutory requirements and oversees the LLC's activities.
Operating Agreement
A New York LLC operating agreement is a legally binding document outlining how the LLC is structured and managed. By documenting these rules, an LLC can avoid potential disputes between members in the future and ensure that the organization remains in compliance with the law. Routinely reviewing and updating your LLC operating agreement may also help in the long run.
EIN Number
The Employer Identification Number (EIN) is a nine-digit number issued by the Internal Revenue Service that identifies your business and employee tax responsibility and is required for all LLCs with multiple owners. To apply for an EIN, you'll need to fill out the IRS Form SS-4.
Business Licenses
The final step to forming an LLC in New York is to make sure you obtain the necessary local or state business licenses and permits. Depending on the type of enterprise you run and its location, different authorization will be required. It is important to understand where and how you need to register your business to ensure proper compliance.
Seeking Professional Assistance
Navigating the complexities of New York LLC law can be confusing and errors can be costly. Business owners who are uncertain of how best to approach this process may benefit from turning to knowledgeable UpCounsel attorneys who understand local regulations and have considerable knowledge when it comes to forming entities in New York. Whether you need a one-time consult or an entire freelance legal department, UpCounsel’s network of experienced lawyers has you covered. From small businesses to the Fortune 1000, groundbreaking companies of all sizes trust UpCounsel and its attorney community to provide high quality, cost-effective legal services. Access to high quality attorneys on demand, business attorneys have an average of 14 years of experience, and profiles of our online attorneys display client ratings and reviews of recent work.
Do your research, review New York's LLC regulations, and consult with experienced professionals to ensure your LLC meets all local requirements. With the right know-how and proper planning, you'll be quickly ready launch your LLC in the Empire State.
Topics:
