New York LLC – How to Form an LLC in New York [5 Easy Steps]

Forming an LLC (Limited Liability Company) in New York is easy and affordable. The following are few procedural steps on how to start an LLC in New York. LLCs can be formed in two ways, domestic and/or foreign. If you are planning to set up an LLC in states other than New York, visit How to Start an LLC.

New York LLC

How to Start a New York LLC

Suppose you’re planning to invest in some profitable business structure or maybe about to set up your business in New York. In that case, forming an LLC in New York is the simplest form of business for you. Ltd. Liability Co is a better option for the business owners as it is a flexible organization. Also, it reduces the personal liability for company or business debt. 

An LLC or a Limited Liability Company a hybrid business entity combining a corporation’s characteristics with a partnership or sole proprietorship. This section gives you a simple – but essential – step-by-step guide on How to Start an LLC in New York. 

Step 1: Decide a Name for Your LLC

name llc

If you are to start an LLC in New York, the first thing you do is decide on a business or company name, and how to name your LLC may be tricky. Thus, you have the option to choose a name that complies with the New York business naming requirements. It must also be easily searchable for potential clients. Here is a step-by-step guide to follow when naming your New York LLC. 

Why do you need a proper business name?

If you want your LLC to have special identification, your company name is essential. However, many people face lots of issues by avoiding focus on choosing a business name for their LLC business formation filings.

Because of this, here are some of the major benefits of choosing the best LLC corporate names.

  • To help establish a company’s presence in the market, a proper business entity type will help you. This also creates a new identity that will resemble your LLC.
  • After you’ve properly chosen the name for your LLC, you will have no problems finishing the registration process.
  • You can only get the EIN number when you have your name registration certificate with you.
What are the requirements when deciding a name for your LLC? 

name search is vital to make sure your business’ name is unique. Check the availability of your name with Business Entity Search on the New York Secretary of State’s website. Submit your reservation application for your LLC name by completing the Name Reservation Request Form for Domestic Entities.    

  • Don’t include words that could confuse people about your company. Words like ‘treasury, state department.’
  • You should also avoid restricted words like ‘bank, attorney, university,’ because they may require a lawyer and more paperwork.
  • As for a business website and your URL name, check if your name is still available for domain use with NameCheap.
Reserve a business domain

Even if you don’t have plans to set up a website today, it will help if you buy a domain to avoid others from using your name for their website, so do visit NameCheap for your domain name and Kinsta for web hosting.

If you have decided on your URL name and have reserved it, set up a professional email account with Google GSuite.  

Step 2: Assign a Registered Agent in New York

get registered agent

A registered agent, or business entity, is a person that will act or work on your behalf. This person or business will receive significant tax forms, legal forms, formation documents, any internal document, a notice of lawsuits, and other official government correspondence in New York. Choosing a New York-registered agent for service of process for your LLC is required. 

Make sure your registered agents are residents of New York. It could also be a business with an office address. Here are the recommended agents and employees for you:

LLC Service

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These five LLC formation services are recommended agents’ registered services as they are authorized to conduct business in New York. Compare them to check the best yet cheapest option for you. Besides, they can guarantee you professional service to their potential customers because they have been in the business for years. 

Step 3: File Articles of Organization in New York

file formation certificate

A Certificate of Name Reservation is needed to file Articles of Organization, as other states call it. You need to make reports of this certificate with the New York Secretary of State, which costs $200. You may file them online or by mail. 

This Certificate of Formation is a legal document needed to form your business officially. It will indicate details about your LLC in New York, like if it is a member-managed or managers-managed. LLCs with employees need to check the New York government portal for guidelines to hire employees. 

Before you start filings, you must already have your LLC name and registered agents or employees. You will attach a copy of your Name Reservation Certificate along with a list of the services that your New York LLC will offer.

How to File Online

Go to the Secretary of State Online Service. Select “non-subscriber.” Fill out the online form. The website will alert you if your county does not support online filings after selecting your principal county.

How to File by Mail

If you prefer filing real-life forms for your New York LLC registration, then you can download the New York Limited Company Certificate of Formation. Read the form thoroughly and fill it out. It will have to fill, among others,  your name, city, state, zip code, and signature. 

Step 4: Create Your New York LLC Operating Agreement

create operating agreement

An operating agreement is a document that legally outlines the proprietorship and operating procedures of your LLC This document is vital as it ensures that all business owners are on the same page regarding how they operate, thus reducing future conflicts. 

Starting an LLC in New York does not require you to have a limited liability operating agreement, but it is ideal to have one that contains all your details of business operation. So, having a liability company operating agreement is recommended.

Step 5: Filing a New York LLC EIN

The Employer Identification Number or, simply, the E.I.N. is a nine-digit number given by the Internal Revenue Service (IRS) to make it easier to identify types of business for tax purposes. It is like a Social Security number dedicated to a business. 

It is also called a Federal Employer Identification Number (FEIN) or a Federal Tax Identification Number (FTIN). You will need this number for tax filing like income tax returns, additional state taxes, and to determine tax classification options.

Mail to:

Internal Revenue Service

Attn: EIN Operation

Cincinnati, OH 45999

Fax: (855) 641-6935

Fee: Free

After Starting your New York LLC 

After forming your LLC, there are still some things that you will need. Take note of the following:

  • Get a company business account
  • File New York business permits & licenses
  • Get liability for business insurance with coverage for employees
  • File a New York LLC annual report or biennial report
  • Already existing LLCs that wish to operate in New York must register as a foreign New York LLC.  

This page has provided you with braod steps to LLC formation and filing processes. You now have to remember the necessary forms needed for the application of permit and licenses, upcoming filing deadlines, and filing fees or filing costs, including fees for late filings to make sure your LLC is up-to-date. 

Why an LLC in New York

Are you aware of the fact that many top-ranked global businesses are based in New York? The reason behind this is the business-friendly environment that makes New York the most favorable destination for business in the world. To start an LLC in New York, business owners need to get different permits such as building permits, signage permits, and health permits if it is a restaurant or food-related business.

Moreover, for start-ups, the New York government has many tax benefits like reducing tax liabilities and incentives like business funding options that will help entrepreneurs start an LLC in New York. Here are the insights.

Start-Up New York Program 

The start-up New York program is a tax benefit program introduced by the state government to bring new start-up ideas and investments into the state. Under this program, a start-up company has to enroll themselves and select based on criteria fixed by the government. All those companies who get selected are eligible for a tax-free operation at some state locations for a period of whopping 10 years.

Federal Work Opportunity Tax Credit (WOTC)

Under this program, some tax rebate is provided to an LLC in New York-based on hiring people belonging to a special group. These special groups are those people who have to follow issues at every step in their journey when they step out for employment. That is why the government is helping hand for such people and wants the New York LLC to hire such people.

For this task, the company will enjoy a tax credit of a minimum of $1200 to a maximum amount of $9600. This amount varies on how many employees of this category are hired by you and the salary they are taking out of LLC accounts. Some of those groups are:-

  • People who are unemployed veterans due to some disability. They are highly qualified.
  • Recipients from the list of Temporary Assistance for needy Families.
  • Community residents living in special empowerment zones or rural areas of the country are still under renewal.
  • People who have a food stamp.
  • Individuals who are on their rehabilitation period and are referred by their centers. 

IDA Commercial Tax Incentives

The IDA commercial incentive is a program in which an LLC going through changes in their existing building or starting the work of new construction is provided a rebate on the land taxes for up to 25 years according to the construction they are proceeding with. Also, the state sales tax is waived for purchasing construction and renovation material is around 8.875%. 

Best Businesses in New York

When you want to form an LLC in New York, you must have complete knowledge of the state’s business environment. To help you in this process, we have mentioned some valuable information below.

Financial Services

How can a person forget the wall street of Manhattan when talking about New York Businesses? The state’s stock exchange and silicon valley are continuously growing since 1817, impacting the whole world with one action. The contribution of this incredible sector to the economy is $211 billion.

Manufacturing Business

Most of the products that are manufactured in the state are basically for exports. Only a few amounts of goods are kept for local use. General software, mobile devices cover the manufacturing industry’s biggest chunk and clothes manufacturing. The contribution of this sector is $64.83 billion, and it is also indirectly supporting the export sector. It accounts for $84.7 billion, which has vegetables and manufactured products in it.

Media and Entertainment

The most prominent media houses of the USA are present in the state that is controlling global trends. Some of the biggest ones are CNN, News Corporation, The New York Times Company, etc. These media houses alone have helped many people generate their livelihood and have contributed around $9 billion to the GDP. The tax that this industry failed in 2014 was accounted for $240 million, which is enormous for the non-manufacturing sector.

Agriculture

The modern state of New York is also rich in its agricultural activities due to its deep fertile soil. Crops produced in the state are pears, strawberries, dairy goods, etc. 25% of the total area allocated to the state is consumed for farming purposes that have recently contributed to around $4.28 billion to the state’s GDP.

Some small businesses that are thriving well in New York are:-

  • Food delivery business
  • Property management
  • Online trading 

New York LLC Formation Review

Time needed: 30 minutes.

To recap, here are the easy steps again when forming an LLC in New York. Click on the steps in this list to read the full detail.

  1. Name your New York LLC

    The first thing you must do is to choose a company name, which should include the phrase “limited liability company,” or one of its abbreviations (LLC or L.L.C.).
    name llc

  2. Choose a registered agent

    In New York, it is mandatory to select a registered agent for your LLC. You can check out our list of our 5 Best LLC Services in the United States.
    get registered agent

  3. File a formation certificate

    Filing a formation certificate is necessary when forming an LLC. Depending on the state, it could be called any of the following: Certificate of Formation, Articles of Organization, or Certificate of Organization.
    file formation certificate

  4. Create operating agreement

    An operating agreement is not a strict requirement but something encouraged when you start an LLC.
    create operating agreement

  5. Get an EIN

    The Employer Identification Number (EIN), also called  Federal Tax Identification Number, serves to identify a business entity like a social security number but for a company.
    get an ein

F.A.Qs

What is the difference between ‘domestic LLC’ and ‘foreign LLC’?

A “domestic LLC” is one that conducts business in a state where it was formed. Meanwhile, a “foreign LLC” is an existing LLC that extended business to another state.

What do I need for Domestic and Foreign LLCs?

For Domestic LLCs, it is vital to have a Certificate of Name Reservation and Certificate of Formation. For the foreign LLCs, you must have a Certificate of Good Standing.

Is the cost to form an LLC the same across states?

The cost to form an LLC varies per state.

Does an LLC need to use a DBA?

Seldom do L.L.C.s use D.B.A. or a ‘Doing Business As’ name nor a fictitious business name. However, if you want to have one, you make read more about DBAs here

Why are operating agreements important?

This document is vital as it ensures that all business owners are on the same page regarding how they operate, thus reducing future conflicts.

Is there anything else I should keep in mind when naming my LLC?

>Your name should have “L.L.C. or LLC” or the phrase “limited liability the business.” 
>Do not include words that could create confusion between your LLC and any government business. 
>Words like ‘bank, attorney, university’ are restricted as well. 
>Lastly, your name should distinguish from other limited liability corporations, limited partnerships, or registered limited liability partnerships.

Where can I file my LLC name?

Typically, you can file your LLC name online or by mail. Check with the state where you will set up your LLC name. Take note that the fees for business names may also vary per state.  

How can I know if my URL name is available?

As for a website and your URL name, check if your name is still available for URL use with NameCheap to see if your name is available as a web domain. Even if you don’t have plans to set up a website today, it will help if you buy a URL. Buying it can help to prevent others from getting your name; check out WPEngine, Kinsta, and GoDaddy for hosting and building your website. 

Can I mail the LLC Certificate of Formation to the Secretary of State?

No. Never mail these documents or payments to the Secretary of State directly. 

Why do I need an EIN?

The reason you might need an E.I.N. is that it would help for three reasons:
>Opening a business bank account
>Filing and managing federal and state taxes
>Hiring employees or agents

How do I get an EIN when I do not have a Social Security number?

You are not required a Social Security number when getting an EIN. You can proceed to fill out I.R.S. Form SS-4 and leave section 7b blank. You must then call the IRS at (267) 941-1099 to complete your application. Agents or employees will help you with that.

I already have an EIN for a sole proprietorship; what now? 

Note that an LLC is different from a sole proprietorship. If you already have an EIN for your sole proprietorship, the IRS will require you to get a new one when your convert to an LLC. 

Do foreign applicants need an SSN to get an EIN?

International EIN applicants do not need an SSN to get an EIN.

What is an IRS?

The IRS is the one that will issue your EIN. You can request an EIN from the IRS ONLINE or download the FORM, fill it out, and send it by mail or fax.

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