The New York Department regulates a number of issues such as business incorporation in the state. Incorporation fees and requirements in New York differ from other states. Some firms can help expedite the process and allow LLCs to operate in New York as soon as possible.
One of the initial steps of forming an LLC in New York is completing the Articles of Organization and submitting them to the New York Secretary of State. The Articles of Organization contains the LLCs name, county location, and mailing address of registered agent.
LLCs must choose a name that is not similar to another business. There are firms that can help LLCs review their name and conform its availability and compliance with state requirements. This helps eliminate delays in the company formation process.
The business name generally is accompanied by “LLC” or “Limited Liability Company”. Some words such as corporation, state police, cooperative, and urban development are prohibited from use. LLCS in New York can expect to pay a $20 fee upon submitting the Application of Reservation of Name. The process of filing a completed articles of organization to the New York Department of State may cost $200.
What is an LLC?
LLC refers to a Limited Liability Company, and it is organized by business owners. They have fewer corporate formalities and can be taxed by the IRS as a sole proprietorship, S corporation, or C corporation.
Each state has different requirements and regulations regarding the formation of an LLC. Business owners should check with state laws when considering forming an LLC.
Owners of LLCs are known as members, they can be individuals, corporations, other LLCs, or foreign entities. There is no limit on the number of members an LLC can have. In most states, “single-member” LLCs are allowed, where there is only one owner involved in managing the LLC.
The IRS will treat the LLC as a corporation, partnership, or included in the LLC owners personal tax return. A domestic LLC with at least two members is classified as a partnership for federal income tax purposes unless they file Form 8832 and elect to be treated as a corporation.
LLCs carry tax advantages over other forms of business such as limited partnerships. The owners of an LLC do not assume personal liability for business debt, and any losses of the LLC can be used as tax deductions against active income.
An LLC can be formed through the state business formation process or consulting with LegalZoom.