How to form an llc in nyc

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With more than 5.4 million applications filed in 2021 alone, it is safe to say that we are seeing a massive boom in new business formation efforts. Limited liability companies (LLCs) remain among the most popular types of business as the startup process is relatively affordable and straightforward.

We created this guide to help you learn how to get an LLC in New York in 2022. We’ll walk you through each step and highlight important considerations.

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What To Do Before Starting a New York LLC

There are a few crucial details you need to take care of before submitting your LLC formation documents. The following sections detail what to handle before you file.

Select Your LLC Business Name

Before trying to register your new LLC, you should make sure the name you plan to use is available. The Department of State Division of Corporations website offers a searchable database to double-check business name availability. For official confirmation that your name is available, you can submit a name search request in writing to the NY Department of State, along with a $5 fee. After settling on a name and confirming that you can register it, remember it must include “limited liability company” or the abbreviations “LLC” or “L.L.C.”

If you aren’t ready to file your LLC documents, you can ensure your chosen business name will remain available for use by submitting an Application for Reservation of Name. The fee is $20 and must be made payable to the Department of State. Once filed, you can hold your chosen name for 60 days.

Name New York Secretary of State as Registered Agent

Most states require LLCs to name a person or business to act as the LLC’s registered agent. The agent’s job is to accept lawsuits and other legal documents on behalf of the business. In New York, you must name the Secretary of State as your LLC’s registered agent. You must also provide an address to which the Secretary of State can mail any documents it receives.

New York also allows you to name an additional New York resident or registered agent business as your LLC’s agent, but you are not required to do this. If you do decide to hire a registered agent company, there are many choices available. The cost ranges between $49 and $300. Be sure to check the services offered to ensure you are getting the best deal.

Create an Operating Agreement

In New York, LLCs must adopt a written operating agreement, as addressed in Section 417 of the state’s LLC laws. This agreement must include details, such as the type of business, how it will function in day-to-day operations, the rights and powers of LLC members and individual obligations or responsibilities. It is possible to make amendments to the operating agreement from time to time. However, you cannot do so without the express consent of all parties.

The operating agreement may be adopted before articles of organization are filed or within 90 days after filing. They are not filed with the state.

Filling Your New York LLC Documents

When you wish to move forward with submitting your formation documents, you will file the articles of organization. Out-of-state LLCs that want to register to do business in New York submit an Application for Authority. Foreign LLC registration costs $250 while domestic LLCs get charged $200.

Foreign entities wishing to do business in New York must remember to include a Certificate of Existence or Good Standing with their application. Be sure the date of the certificate is no more than a year older than your application.

You can apply to form an LLC in New York by mail or online. Mail applications may face a long wait, but you can expedite them for a fee. Meanwhile, digital applications are processed immediately, with practically no delay.

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What To Do After Establishing Your LLC in New York

Once you successfully form your LLC, there is still more to do as detailed in the following sections. These vital tips will help keep your new business venture in good standing.

Newspaper Publication Requirement

New York LLCs must publish notices of the LLC’s formation in two newspapers designated by the county clerk of the county where the LLC’s office is located. The notices must run once a week for six weeks. The newspapers will charge a fee for the notices.

Once the notices have run, the newspapers will provide you with affidavits of publication. You must file these, together with a Certificate of Publication, with the New York Department of State. There is a $50 filing fee. You must file the certificate within 120 days of the LLC’s formation.

Get an Employer Identification Number

An employer identification number (EIN) is nine digits long and is sometimes called a federal employer identification number (FEIN) or federal tax identification number (FTIN). Per federal law, most LLC owners must obtain an EIN. Single-member LLCs without employees can use Social Security numbers, but an EIN is still a good idea. You can get your EIN on the IRS website.

File Your Biennial Statement

LLCs must file a biennial statement every two years. The statement provides the address to which the secretary of state can send the service of process. The statement can be filed online and the filing fee is $9.

Correct Any Filing Errors

Even if you double-check your information before filing, it is still possible to make mistakes. If you note an error or more after your LLC paperwork is processed, you must correct it as quickly as possible. Submit a Certificate of Correction and the associated $60 filing fee to the New York State Department of State, Division of Corporations, One Commerce Plaza, 99 Washington Avenue, Albany, NY 12231.

Dissolving a New York LLC

If you desire to or there are no longer members of the LLC, you can file Articles of Dissolution with the Department of State. The fee is $60. Be sure that you pay any outstanding debts or financial obligations prior to attempting to dissolve the business.

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Frequently Asked Questions (FAQs)

How do I set up an LLC in New York?

Domestic entities pay $200 and file articles of organization and foreign entities pay $250 and submit an Application of Authority to the Department of State. You can submit your documents by mail or online.

Do New York LLCs have to file an annual report?

New York LLCs must file a biennial report every two years. The fee is $9.

Do I have to publish an ad to announce my new LLC?

All New York LLCs must publish ads in two local newspapers following formation. You must publish the ads and submit proof of publication within 120 days of establishing your new LLC.

What are the different types of LLCs to set up?

When determining how to start an LLC, there are several types of LLCs to choose from. Knowing the LLC structures available is essential for selecting a business model that most closely aligns with the nature of your company and how you intend for it to operate. These LLC structures include:

• Single-member LLC: This LLC is owned and operated by a single person. While similar to a sole proprietorship, this LLC provides additional tax benefits and liability shielding.
• Multimember LLC: Standard LLCs with more than one member, often divided into manager-managed or member-managed entities.
• L3C: These entities, also known as “low-profit liability companies,” act as a bridge between nonprofit LLCs and for-profit LLCs where the business cause remains the primary focus rather than earnings.
• Series LLC: Series LLCs are tiered business structures where the topmost LLC owns a series of lower-tiered LLCs through limitless segregation. Each LLC in the series operates mostly independently of one another; their assets are also primarily separated.
• PLLC: A specialized LLC, this business formation type is only available to certain licensed professionals.
• Restricted LLC: Restricted LLCs are not taxed during the first 10 years of formation. Likewise, they cannot make distributions to members. It must be stated in the articles of organization that the LLC will be restricted.

What other legal classifications are there for my business?

There are a number of different kinds of legal classifications your company can use to protect itself from liabilities. For example, filing a corporation can be useful if you want your company to be partially owned by outside shareholders. This is a preferable arrangement for many business owners. For more details, check out our comparison of LLCs and corporations.

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