How to form an LLC in New York
The drive and the desire are not enough to start a business, it is necessary to comply with a plan so that it has the desired success. Starting from this point in Hispanic Entrepreneurs we will teach you How to form an LLC in New York.
Why start a business in New York?
New York is an ideal territory to develop businesses and companies, whether you are considering forming an LLC (Limited Liability Company) or a corporation. From there you can reach other national and international markets.
You could also benefit from the incentive programs offered by the state to promote small and medium businesses.
In New York, as well as in the rest of the United States, there are several options to legalize businesses. There are sole proprietorships and general partnerships that file in the county where they will operate.
Business corporations that need a certificate of incorporation and register with the Department of State. Likewise, that the limited liability companies that merit the presentation of the articles of organization. While, limited partnership corporations consign the limited partnership certificate.
There are many possibilities to be the fourth most populous state in the country, It has 62 counties, the largest being New York City. It is home to a wide variety of small, medium and large companies including ABC, Avon, CBS, Marvel Comics and Master Card. It accounts for 7,2% of all businesses in the country.
Advantages of registering an LLC in New York
You must be clear that the LLC is a type of business that grants protection to the owners. That is, the company is separate from the assets of the owners with its own rights and responsibilities.
LLCs are easy to register in New York State. This incurs some expense, but is generally inexpensive to maintain. It offers personal protection, personal assets will be separated from business ones. If the company is sued or has debts, the plaintiff will not have the right to touch personal property.
On the other hand, you pay tax as a sole proprietorship or partnership (transfer tax). In other words, they pass from the business to the owners as personal income tax. It is a way for small businesses to reduce the tax burden.
These types of businesses are more flexible in terms of the formation of their organizational structure. They are not required to form a board of directors, or assign corporate officers, nor do they keep minutes. In addition, they can have an unlimited number of owners and profit sharing is easier.
By having a separate entity you have the option to create a new credit profile. The credit history of the owners has nothing to do with the LLC. Besides, it gives commercial identity, because no other company in the state will be able to use the name of your business. It allows you to own another LLC, corporation, or any other type of legal entity.
How to form an LLC in New York
Naming the company is the first step in registering it. The name must be unique and then make sure that no other business has it. It must bear the phrase "limited liability company" or its abbreviation LLC. You can reserve it for 60 days for a cost of 20 dollars.
Then choose a registered agent, it will accept the documents and tax notices on behalf of the owner or owners. Their name must appear on the certificate of formation or the secretary of state will act as the agent.
Next, it presents the articles of organization, they are the documents that are consigned to officially register the company with the New York State Department. They can be sent by mail, fax or online, the latter option is recommended because it is faster. If you opt for the other two, it would take between 3 and 4 weeks.
The filing fee is $200, payable by cash, check, money order, MasterCard, Visa, or American Express. The expedited processing service offered by the New York State Department of State Division of Corporations is for urgent documents.
You can use it by paying an additional fee of $25 and it will be processed within 24 hours. If it is for the same day, it is $75 per document and $150 within 2 hours. To apply online, create an account at NY.gov. When you want to check the status just log in.
When the articles of organization are approved, those who carry out the process will receive the identification number of the employer (EIN). With these two requirements it is advisable to open a commercial bank account. The EIN is requested at https://www.irs.gov/.
New York requires that within 120 days the LLC must publish a copy of it or a related notice in 2 newspapers. The printout must be sent to the Department of State along with the affidavit of publication and $50
It should be noted that newspapers are appointed by the clerk of the county in which the business is located. Likewise, it is suggested to draft an operating agreement that will only be legally binding on the members.
More Obligations of LLCs
The New York State Department requires LLCs to file a biennial return. It is done online and the fee is $9. The companies that request it receive a notice by mail when the term for the presentation of said declaration expires.
Likewise, they are obliged to carry out their activities under their legal name. If they opt for one that does not appear in their documents, they must present a fictitious name certificate. It is also ordered at the Department of State for $25.
After completing the registration, investigate what licenses or permits you need. Some business activities require authorization from state or local governments. Contact the appropriate county clerk to find out which ones you should apply for.
Also, check with other agencies if you will have to comply with additional licenses. Among the most important is the New York State Department of Labor (www.labor.ny.gov/home/). As well as the New York State Board of Workers' Compensation (www.web.ny.gov).
Surely you have to take out unemployment insurance and Workers' Compensation. The first is processed in the Department of Labor and the second in the New York State Insurance Fund or in a private company.
Depending on the structure, location and employees, disability and health insurance may be necessary.
To comply with state licenses, register the business at https://my.ny.gov/SelfRegV3/selfreg.xhtml?app=nyappelic. It is possible to manage this entire process online.
Additionally, enroll as a sales tax provider of the state of New York. Ask the State Department of Taxation and Finance for a Sales Tax Authority Certificate.
Support for ventures and New York
Before starting business operations, look for information about the resources that the state offers to help companies. It can be financial support, advice and training.
Apply for support at the New York State Small Business Development Center. As well as in the NYS Empire State Development.
If you are not sure about forming an LLC in this state, you can consult our article How to Create an LLC in Florida.
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