Starting an LLC in NY? It’s Easy with These Steps:
Starting an LLC is a great way to grow your small business and reduce personal risk. An LLC, also known as a limited liability company, gives you access to various financial options, lets you open accounts with wholesalers and service providers, and lets you pick a tax structure that makes sense. Here’s a look at how to get your LLC in NY and take advantage of your corporate status.
How to Easily Form Your LLC in NY
The easiest way to get your LLC in NY is to follow the instructions and paperwork with the New York Department of State (NYDOS). To get started, name your LLC and perform a title search, name a registered agent, and provide information about the members of the LLC. Finally, you’ll need to submit the paperwork and pay fees for the formation and publication of your LLC.
Once NYDOS has accepted your articles of organization, you are free to operate as an LLC under the laws of the state of New York. Here’s what’s involved when looking at how to get your LLC in NY.
Choose a Name for Your LLC As Per NY Naming Guidelines
The first step is to name your company and make sure that the name isn’t used by another corporation in the state of New York. Your name also has to contain LLC, L.L.C., or Limited Liability Company Start by searching the database of corporate names on the NYDOS website to find out if another LLC is using your chosen name.
The NYDOS has prohibited and restricted the use of certain words for LLCs and may require additional paperwork to get approval. The prohibited words include ones that could be confused with a state or federal agency. Restricted words include historical, doctor, education, blind, board of trade, and loan, among others.
Once you’ve determined that your name is free and clear, you can use it for your LLC. If you’re not quite ready to form your LLC but don’t want to lose the name to another LLC, you can file an application to reserve the name and pay a fee of $20. Your name will be reserved for 60 days, and you can file for two 60-day extensions after the initial filing for a total reservation time of six months.
To register your name quickly, you can use the NYDOS expedited handling service for filing. The time and costs for expedited filing per document are:
- 24 hours – $25.00
- Same day – $75.00
- Two hours – $150.00
The fees can be paid by check, money order, MasterCard, Visa, and American Express. You will need to fill out a Credit Card/Debit Card Authorization Form when paying by one of these methods.
Contact a Reputable and Experienced Registered Agent in NY
The NYDOS requires all LLCs to use the Secretary of State as the registered agent for process services. You’re required to provide a mailing address for delivery of all legal paperwork received by the Secretary of State.
This is a convenience the state provides for someone forming an LLC in New York State. However, it can also be a drawback due to the publishing requirement for forming an LLC. You’re required to publish notice of the formation of your LLC in local newspapers. If the principal address of the LLC is in New York City, you can pay up to $1,500 if you’re based in New York City and even more if you’re a foreign corporation forming an LLC in New York State.
Why Choose a Registered Agent in NY?
Using a registered agent based in an area where the publication costs are lower helps you save money. The NYDOS requires you to publish your announcement in newspapers where your business or registered agent is. Contracting with a registered agent in an area outside a major city in New York fulfills your need to save money on publishing costs and gives you access to other benefits.
Another benefit to using a registered agent other than the Secretary of State is that it preserves your privacy. Your personal information or mailing address for the LLC is published for all to see when you use the Secretary of State for the registered agent. Companies that harvest information for marketing to LLCs will send you unwanted marketing materials; anyone can find out who you are and where you live.
Retaining a registered agent to handle your correspondence allows you to maintain your privacy. You also get hassle-free publication for your LLC as the registered agent has experience correctly publishing the information required to satisfy the NYDOS requirements.
File Your NY LLC Organization Articles
After you’ve filled out and completed the Articles of Organization in accordance with the instructions on the form, it’s time to file. You can file through the mail, or you can file online through the Division of Corporations.
To file by mail, you need to send your paperwork and a filing fee of $200 to:
New York Department of State
Division of State
Division of Corporations
State Records and Uniform Commercial Code
One Commerce Plaza
99 Washington Avenue
Albany, New York 12231
The address itself is complex, but you need to ensure that it’s correctly written on the address to confirm it reaches the right department for filing.
To file online, you can create an account with the Division of Corporations On-Line Filing System and follow the instructions for submitting the Articles of Organization and paying the filing fee.
Know About NY LLC Publication Requirements
You’re required to publish a notice of LLC formation in two newspapers within 120 days after forming your LLC. Specifically, you have to publish one notice weekly and one daily for six consecutive weeks in the county where your principal office for your LLC is located. Alternatively, you can use the address of your designated registered agent.
That means you must file a notice for 45 consecutive days in one newspaper and six times over a month and a half in another paper. Newspaper publishers are familiar with this requirement for LLCs and may offer a publishing package to help save you money. However, contracting with a registered agent in an area where newspaper advertisements are less costly can save you money and give you access to the protections mentioned above.
Create a NY LLC Operating Agreement
You’re not required to create an operating agreement and submit it with your Articles of Organization when you form your LLC. However, you should make it a point to make one, as it can protect you and your organization if there’s ever a disagreement among the members and the issue goes to court.
The operating agreement lays out which member is responsible for specific duties and if a manager is required to perform a set of responsibilities. While a manager is not a member with rights, the members give the manager these duties to separate themselves from a process or operation. Sometimes a member decides to take over a duty they weren’t named to perform, leaves the LLC, sells their shares, or acts in a fashion that’s not beneficial to the corporation. This is why an operating agreement is necessary.
You may need to take the non-performing member to court to force them to comply with the operating agreement. The court, or judge, can use the operating agreement as a type of roadmap that lays out the member’s expected performance against their actions. This makes it more likely that the judge will rule in favor of the LLC and order the non-performing member to correct their actions or leave the LLC entirely.
Receive a NY LLC Employer Identification Number (EIN)
An employer identification number, or EIN, is issued by the IRS for certain business purposes. You may have obtained an EIN to protect your Social Security number as a sole proprietor, but you need a different number for your LLC. The EIN enables your LLC to take actions that include:
- Remit federal and state taxes
- Open a bank account for the LLC
- Hire employees and remit payroll taxes
- Open accounts with suppliers that require an EIN
Getting an EIN is straightforward. You can have an EIN for each LLC you form and keep any EIN you’ve already obtained.
When You Should Seek Help for Creating an LLC in NY State
Starting an LLC in NY is straightforward regarding the information required for its formation. However, it is time-consuming, and you must ensure you’re prepared to begin the process. It’s also important to avoid making a mistake in the Articles of Organization, as a mistake can result in a delay. The NYDOS will send your papers back to you for correction or outright reject your Articles of Organization if they’re not correct. Avoiding these issues is easy, especially when you contact Windsor Corporate Services for help.
At Windsor Corporate Services, our staff of professionals can get your LLC formed quickly and accurately. We offer affordable filing packages featuring services that meet your needs. Select our basic package to get your LLC created and get your business started, or select our ultimate package for services that go above and beyond the formation of your LLC. Get in touch with us today by phone, or use our contact form to send a message anytime.