A Step-by-Step Guide: 8 Steps to Form an LLC in NY
New York is one of the best places to start your own business. A multi-million community offers a wide range of possibilities and it’s not surprising why so many people are moving to the NY State. If you’re one of them, then you’re probably thinking to set up an LLC in New York.
LLC is the most common form of business registration and it’s pretty straightforward, but you have to follow some basic rules and steps. You have to adhere to State and Federal laws to ensure the registration process goes smoothly and effortlessly.
Fortunately, we’ve put together this step-by-step guide on how to form an LLC in NY. We’ll cover everything from choosing a name for your company to registering with the state.
Choose a unique name for your LLC
When choosing the name for your LLC, make sure it is not too similar to the names of other companies already on file with the New York Secretary of State (SOS). If there is an exact match with another company name or trade name, you may have difficulty obtaining formal recognition from the SOS and should consider using a different name altogether.
If there are multiple matches within the same industry code but no exact matches, then proceed with caution and seek legal advice before proceeding with incorporation. However, if there are no matches within either category then go ahead and select the name for your LLC
Choose a registered agent in New York
Choosing a registered agent in New York is not the mandatory step to forming a limited liability company, but it’s highly recommended. Your registered agent is responsible for accepting important legal mail on behalf of your LLC, such as subpoenas, complaints, and summonses.
Submit LLC Articles of Organization
If you’re ready to start an LLC in New York, then you’ll need to complete and file Articles of Organization, which will cost you $200.
The articles are a form that tells the state how you want your business to be organized and who is responsible for running it. It also tells them what type of business entity you plan on being: sole proprietorship, partnership, or corporation.
Once your articles have been approved by the New York Division of Corporations, State Records, and Uniform Commercial Code (DCCSUNC), they will send you back a Certificate of Formation that states when your LLC was formed and what its official name is.
Publish your LLC
Publishing your Articles of Organization is an important step that you must take within 120 days of filing your Articles of Organization with the New York Secretary of State. You must publish your Articles of Organization in two newspapers (one weekly and one daily) for six consecutive weeks in the county where your principal business address is located.
The Secretary of State will provide you with a list of newspapers that meet these requirements, but you can also find them on your own by searching “New York” and “newspapers” together on Google or Bing.
Once you’ve published your Articles of Organization, you’ll receive a Certificate of Publication which you’ll need to keep with your records as part of maintaining your LLC.
Create the LLC Operating Agreement
An LLC Operating Agreement is a legally binding agreement that outlines the rules and regulations of how your LLC will operate. It’s sort of like an instruction manual for running your business. It’s important to have one with any type of LLC, but it’s especially important if you’re planning on hiring employees or taking on investors.
It’s important to understand that an operating agreement does not have to be complicated or extensive; it can be as simple or as detailed as you want it to be. But there are some important items you should include in your operating agreement:
1. Get an EIN
An Employer Identification Number (EIN) is a number the IRS assigns to businesses and organizations when they apply for one. It’s used to identify your business to the IRS, so you use it when filing and paying taxes when submitting payroll information and payments for your employees, and when opening a business bank account.
How do you get your EIN?
- The IRS recommends applying for your EIN online because it’s fast and easy—you’ll receive your number within minutes!
- If you’d prefer to apply by mail, you can download Form SS-4 from the IRS website. You may also want to read this article about how to get an EIN.
1. Open Bank Account
Now that you’ve incorporated, you need a bank account for your LLC. Why? Because an LLC is a legal entity separate from its members. If you mix your personal and business finances, it erodes the separation between your LLC and yourself and puts your limited liability at risk.
2. Comply with NY State tax and regulatory requirements
As a New York LLC, you are required to file the Biennial Statement with the New York Department of State every other year. The purpose of this form is to keep the state up-to-date on who is running your business and how to contact your LLC.
To sum it up!
And that’s about it. Forming an LLC company in NY isn’t rocket science and it should be done within a few days, but you have to follow the process and steps from above. If you still have any questions and doubts on this topic, feel free to leave a comment and we’ll gladly respond.