How to Start Your LLC

Giselle Ayala Mateus, Esq.

Are you contemplating establishing your enterprise in New York? The state’s considerable population and diverse cultural landscape offer a wealth of prospects. This explains the prevalence of small businesses within the region, with the Limited Liability Company (LLC) emerging as a preferred entity. Let’s explore how to create one!

Select the Name of the Limited Liability Company (LLC)

Choosing a name for your LLC in New York is the first big step in establishing your business’s identity and presence. It’s not just a formality; it’s a legal necessity according to state laws. Your LLC’s name must be unique and distinguishable from other businesses already registered in New York. This requirement prevents confusion and ensures that your business stands out in the state’s official records. Additionally, the name you pick must include “LLC,” “L.L.C.,” or “Limited Liability Company” to comply with New York’s legal guidelines.

Beyond legalities, the name of your LLC sets the tone for your brand and how potential customers will perceive your company. A well-chosen name can convey professionalism, reliability, or creativity, depending on your goals. It also plays a critical role when you’re setting up a website since having a matching domain name strengthens your online identity and makes it easier for customers to find you. Plus, when it’s time to manage your money, banks will require your official LLC name to open any business accounts, keeping your personal and business finances separate and organized.

Select the Name of the Limited Liability Company (LLC)

When selecting an LLC name, there are several important factors to consider:

1. State Requirements: Your LLC name must comply with New York’s naming requirements, which means it should be unique and not easily confused with existing businesses in the state. It also needs to include “LLC,” “L.L.C.,” or “Limited Liability Company” in the name.

2. Brand Relevance: Choose a name that reflects your business’s services or products and conveys the brand image you want to present to the world.

3. Domain Availability: Check if the domain name is available for your LLC so that your website can have a matching or similar web address, which is crucial for online marketing and branding.

4. Trademark Search: Conduct a trademark search to ensure your LLC name doesn’t infringe on any existing trademarks, which could lead to legal issues down the line.

5. Future Growth: Think about how your business may evolve and choose a name that won’t limit your growth or expansion into other areas.

6. Easy to Remember: A good LLC name should be easy to spell, pronounce, and remember so that potential customers can easily find and refer your business.

Are you thinking about starting an LLC in New York? We’ve got you covered with our New York LLC Formation Service. Now, let’s dive into transferring ownership of an LLC in New York.

Speak with a Business Lawyer in New York today.

Call (347) 329-3952 today to schedule your free consultation.

Appointing a Register Agent

A Registered Agent is an individual or business entity responsible for receiving legal documents, government correspondence, and official notices on behalf of your LLC. In New York, as in other states, having a Registered Agent is not just helpful; it’s required by law for the formation of an LLC. This agent must have a physical address within the state (known as a registered office) and be available during normal business hours to ensure that any important paperwork doesn’t go unnoticed. The role of the Registered Agent is crucial because it ensures that the LLC can be contacted reliably by the state and that legal documents are handled promptly.

Appointing a Registered Agent is useful because it provides peace of mind that your LLC won’t miss any critical legal notices, such as service of process in case of a lawsuit, which could have serious consequences if ignored. For many business owners, especially those who operate outside of New York or travel frequently, having a Registered Agent ensures they stay informed about their legal obligations even when they’re not physically present. Additionally, using a Registered Agent service can help maintain privacy, as the agent’s address is listed in public records, not the business owner’s personal address. This is particularly beneficial for home-based businesses looking to keep their home address private.

File the Articles of Organization

The Articles of Organization is a mandatory document that officially forms your LLC under state law. In New York, this document outlines key information about your business, such as the LLC’s name, address, Registered Agent details, and the names of the members (owners). It may also include other pertinent details like the purpose of the LLC and how it will be managed. Filing the Articles of Organization with the New York Department of State is the critical step that brings your LLC into legal existence. Without this filing, your business cannot be recognized as an LLC, which means it won’t have the legal protections or structure that come with this type of business entity.

To file the Articles of Organization in New York, you must submit them to the New York State Department of State, Division of Corporations. This can be done either by mail or online through the department’s website. Filing these articles is essential because it’s the only way to ensure your LLC is legally established and able to operate within the state. Additionally, having a properly filed Articles of Organization is necessary for opening bank accounts, obtaining business licenses, and ensuring limited liability protection for the members of the LLC. This protection separates the members’ personal assets from the business’s debts and liabilities, which is one of the primary reasons entrepreneurs choose the LLC structure.

Create an Operating Agreement

An operating agreement is a legal document that outlines the ownership structure and operating procedures of an LLC. In New York, while it’s not mandatory to file this document with the state, having an operating agreement is required by law for every LLC, regardless of its size or number of members. This agreement sets forth how the LLC will be managed, how profits and losses will be distributed, and what happens if a member wants to leave the business, among other governance issues. It serves as a guidebook for running the LLC and helps prevent misunderstandings between members by clearly stating each person’s rights and responsibilities.

You don’t need to file the operating agreement with any government agency in New York; instead, it should be kept on file at the principal place of business where it can be accessed by the LLC members. Having an operating agreement is crucial because it provides protection for the members by reinforcing the limited liability status of the LLC. It also gives members control over their business operations, which can be particularly important in New York, where default state laws will apply to any situation not covered by an operating agreement. By creating a customized operating agreement, members ensure that their own rules and agreements are followed, rather than relying on generic state laws that may not suit their specific business needs or the common law precedent which may be far from their desire.

Obtain an EIN

An Employer Identification Number (EIN), often referred to as a Federal Tax Identification Number, is a unique nine-digit number assigned by the Internal Revenue Service (IRS) to businesses operating in the United States. It’s like a Social Security number for your LLC and is used for various tax-related purposes, including filing taxes, opening business bank accounts, and hiring employees. In New York, as in other states, obtaining an EIN is necessary for any LLC that will have employees or if the LLC has more than one member. Even single-member LLCs may need an EIN to handle certain types of tax filings or to establish business credit.

To obtain an EIN, you must file an application with the IRS. This can be done quickly and easily online through the IRS website, or by mailing or faxing Form SS-4 to the IRS. There is no filing fee. An EIN is essential because it allows your LLC to comply with federal tax requirements, such as payroll tax reporting if you have employees. Additionally, having an EIN helps maintain your limited liability protection by separating your personal finances from your business dealings. In New York, while the state itself does not issue EINs, your LLC will need this federal number for state tax purposes, such as registering for New York State sales tax or withholding tax if you’ll be employing people in the state.

Meet the New York Publication Requirement

The New York Publication Rule is a legal requirement for all newly formed LLCs in the state of New York. According to this rule, within 120 days of the formation of your LLC, you must publish a notice of your LLC’s formation in two newspapers—one daily and one weekly—designated by the county clerk in the county where your LLC is located. The notices must run once a week for six consecutive weeks and include specific information about your LLC, such as the name of the LLC, the date of formation, the county in which it operates, the street address of the principal business location, and a statement that the Secretary of State is designated as an agent upon whom process against the LLC may be served.

To comply with the New York Publication Rule, after publishing the notices, you must obtain affidavits of publication from the newspapers and file them, along with a Certificate of Publication and the required fee, with the New York Department of State. Failing to meet this requirement can result in your LLC being suspended from conducting business in New York. Although the publication process may seem like an additional hurdle, it is a mandatory step to ensure your LLC is in good standing and has the authority to conduct business within the state. It’s important to budget for this expense when planning your LLC’s finances, as publication costs can vary significantly depending on the county.

Are you thinking about starting an LLC in New York? We’ve got you covered. We take care of the Publication Requirement for You! Speak with a Business Lawyer in New York today.

Call (347) 329-3952 today to schedule your free consultation.

File the Beneficial Ownership Information

The Beneficial Ownership Information report is a federal requirement that will come into effect as part of the Corporate Transparency Act (CTA), which was passed to help prevent and combat money laundering, terrorist financing, and other illicit activities. Now implemented, this report requires certain business entities, including LLCs, to provide information about their beneficial owners—the individuals who ultimately own or control the company—to the Financial Crimes Enforcement Network (FinCEN) of the U.S. Department of the Treasury.

Reporting companies will have to report beneficial ownership information electronically through FinCEN’s website: www.fincen.gov/boi. Reports will be accepted starting on January 1, 2024.

  • If your company was created or registered prior to January 1, 2024, you will have until January 1, 2025, to report BOI.
  • If your company was created or registered on or after January 1, 2024, and before January 1, 2025, you must report BOI within 90 calendar days after receiving actual or public notice that your company’s creation or registration is effective, whichever is earlier.
  • If your company is created or registered on or after January 1, 2025, you must file BOI within 30 calendar days after receiving actual or public notice that its creation or registration is effective.
  • Any updates or corrections to beneficial ownership information that you previously filed with FinCEN must be submitted within 30 days.

Need help filing your New York LLC?

Look no further! On top of helping you start your New York LLC, we can also help you run and grow it with our many business solutions. Starting a business of any kind in any industry isn’t easy, but we’ll do our best to help you!

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