Starting a business in New York can be an exciting venture, and one of the most popular ways to do so is by forming a Limited Liability Company (LLC). An LLC provides several advantages, such as personal liability protection, flexible management options, and tax benefits, making it a preferred choice for many entrepreneurs. However, the process of establishing an LLC in New York can seem daunting if you’re unfamiliar with the requirements and steps involved.
This comprehensive guide will walk you through everything you need to know about starting an LLC in New York in 2025. From choosing a name for your LLC to handling New York’s unique publication requirement, we’ve got you covered. You’ll also learn about important filing steps, such as submitting the Articles of Organization, creating an Operating Agreement, and obtaining an Employer Identification Number (EIN) from the IRS.
In addition to the formation steps, we will also discuss what you need to do once your LLC is approved, such as filing the Biennial Statement and staying compliant with state and tax regulations.
Starting your own LLC doesn’t have to be complicated or stressful. By understanding the steps and staying organized, you can navigate the process with ease and lay a strong foundation for your business. Whether you’re planning to open a small boutique, a tech startup, or a consultancy, this guide will help you tackle the specifics of LLC formation in New York, ensuring your business gets off to the right start. Let’s dive into the essential steps to form your LLC in the Empire State!
Steps to Form an LLC in New York
Starting an LLC in New York involves a series of well-defined steps. Here’s an overview of the entire process.
1. Search Your LLC Name
Choosing a name for your LLC is one of the first things you’ll need to do. The name of your LLC must be distinct and distinguishable from other existing businesses in New York. There are some specific rules you’ll need to follow when choosing the name, and if your chosen name is already taken, you’ll need to pick another one.
Your LLC name must include the phrase “Limited Liability Company” or the abbreviations “LLC” or “L.L.C.” This helps ensure that the public understands the legal nature of your business entity. Additionally, you can’t use certain restricted words like “bank,” “insurance,” or “corporation” unless your LLC is authorized to use them.
To check whether your chosen name is available, you can search the New York Department of State’s online database of business names. This is a free service that allows you to see if your desired name is already taken. You will need to be creative in choosing a name, especially if you’re operating in a popular industry where many business names are already in use.
2. Choose How You’ll Approach the LLC Publication Requirement
New York is one of the few states that requires LLCs to publish their formation notice in local newspapers. The state mandates that your LLC must publish an advertisement in two newspapers for six consecutive weeks. The newspapers must be designated by the county clerk, and one must be a daily newspaper, while the other should be a weekly one.
How Much Do the Newspaper Ads Cost?
The cost of the publication requirement varies depending on where your business is located. In more rural areas, publication costs can range from $300 to $500, but in larger cities like New York City, you can expect to pay upwards of $1,000 for the entire process.
For entrepreneurs on a tight budget, it’s important to consider these costs when planning your LLC. You should also factor in potential fees for additional newspaper publications or other expenses, such as fees for obtaining affidavits of publication.
How Do I Determine How Much Money I Might Save?
If you’re trying to minimize costs, consider the following options:
- Location Matters: Some counties in New York offer lower publication rates than others. Consider forming your LLC in a county where newspaper fees are lower.
- Discounts: Some newspapers may offer discounts for certain types of publications, or you may be able to negotiate a lower rate. It’s worth calling around to get quotes from different publications before making your decision.
3. Choose a Registered Agent (Optional)
A registered agent is someone or an entity designated to receive legal documents on behalf of your LLC. While the state of New York allows you to designate yourself as your LLC’s registered agent, many business owners prefer to hire a professional registered agent service.
By appointing a registered agent, you ensure that important legal notices, such as tax forms and court summons, are handled properly and delivered to your business promptly.
For Example:
- Yourself: If you are the only member of the LLC and live in New York, you can serve as your own registered agent. This might save you some money but requires that you are available during business hours to accept documents.
- Professional Services: If you prefer not to handle legal notices or want to maintain privacy, you can hire a professional registered agent service. These services typically cost between $100 and $300 per year.
What Is a Registered Agent?
A registered agent is a person or business that accepts legal documents on behalf of your LLC. If you choose to be your own registered agent, you must have a physical address in New York where documents can be delivered. If you’re often unavailable during business hours or do not have a physical office in New York, using a professional service can be beneficial.
4. File Articles of Organization
To officially form your LLC, you need to file the Articles of Organization with the New York Department of State. This document outlines your LLC’s basic information, including the name of the LLC, the address, the registered agent, and whether the LLC will be managed by members or managers.
The filing fee for the Articles of Organization is $200. This is a one-time fee and is required to establish your LLC in New York.
5. Create an Operating Agreement
An Operating Agreement is a legal document that outlines how your LLC will be governed. Although the Operating Agreement is not required to be filed with the state of New York, it is a highly recommended document. It defines the roles and responsibilities of LLC members, how profits and losses will be shared, and how the LLC will be managed.
Even if you are the only member of your LLC, having an Operating Agreement can help you avoid disputes and ensure smooth operations. The Operating Agreement should cover the following topics:
- Ownership structure
- Member roles and responsibilities
- Decision-making processes
- Profit and loss distributions
- What happens if a member wants to leave the LLC
While it may be tempting to skip this step if your LLC is a one-person operation, remember that having a clear Operating Agreement can help avoid confusion and legal issues in the future.
6. Get an EIN for Your LLC
An Employer Identification Number (EIN) is required for your LLC if you plan to hire employees, open a business bank account, or file certain types of taxes. The EIN, also known as a Federal Tax Identification Number, is issued by the Internal Revenue Service (IRS).
You can obtain your EIN by filing an online application on the IRS website. This process is free, and you can receive your EIN immediately. If you prefer, you can also submit the application by mail or fax, though this process will take longer.
7. Publish Your Newspaper Ads (and Get Affidavits of Publication)
After filing your Articles of Organization, you must publish a notice of your LLC’s formation in two newspapers for six weeks. Once the ads are published, the newspapers will issue affidavits of publication, which you’ll need to file with the New York Department of State.
It’s essential to keep these affidavits in a safe place because they are required when you file the Certificate of Publication.
8. File a Certificate of Publication
Once your newspaper ads have been published for six weeks, you must file a Certificate of Publication with the New York Department of State. This certificate verifies that your LLC has met the state’s publication requirement. The filing fee for the Certificate of Publication is $50.
It’s important to file this certificate within 120 days of forming your LLC. Failure to do so will result in your LLC being suspended, and you will be required to pay additional fees to reinstate your LLC.
9. File a Certificate of Change (Optional)
If you need to make changes to your LLC, such as updating the business address or changing the name of your LLC, you can file a Certificate of Change with the New York Department of State. This is not required, but it ensures that the state’s records are kept up-to-date.
What Do I Do After My LLC is Approved?
After your LLC is officially approved and your formation documents are filed, there are several steps you should take to ensure your business remains compliant with state and federal regulations.
How Much Does a New York LLC Biennial Statement Cost?
Once your LLC is established, New York requires you to file a Biennial Statement every two years. The filing fee for the Biennial Statement is $9.
When Is the Biennial Statement Due?
The Biennial Statement is due every two years on the anniversary of your LLC’s formation. For example, if you formed your LLC on June 1st, 2025, your Biennial Statement would be due on June 1st, 2027.
When Is My First Biennial Statement Due?
Your first Biennial Statement is due in the second year following your LLC’s formation. If you formed your LLC in 2025, your first Biennial Statement would be due in 2027.
How Do I File My LLC Biennial Statement?
You can file your LLC’s Biennial Statement online with the New York Department of State. This process is simple and typically takes just a few minutes to complete.
How Will My LLC Be Taxed?
By default, LLCs are considered pass-through entities for tax purposes, meaning the profits and losses of the LLC pass through to the owners’ personal tax returns. However, LLCs in New York have the option to elect a different tax treatment, such as S Corporation status, which may offer tax benefits depending on your LLC’s income.
Conclusion
Starting an LLC in New York can be a rewarding and straightforward process if you follow the required steps and remain organized. By choosing a unique name, fulfilling the state’s publication requirement, and filing the necessary documents, you can legally establish your business entity and start operating with liability protection. Don’t forget to create an Operating Agreement, obtain an EIN, and maintain your LLC’s compliance with annual requirements like the Biennial Statement.
While the process can seem complex, breaking it down step-by-step makes it manageable. The key to success is staying on top of deadlines, especially with the publication and filing requirements that are unique to New York. Once your LLC is formed, remember to file the Biennial Statement, and ensure your business remains in good standing with the state.
Whether you’re starting a small business, a tech startup, or a service-based company, forming an LLC in New York offers several advantages, including personal asset protection and tax flexibility. By carefully following this guide, you’ll be well on your way to creating a strong foundation for your business and setting yourself up for long-term success.
FAQs
How much does it cost to start an LLC in New York?
Starting an LLC in New York costs about $200 for filing and additional costs for publication, ranging from $300 to $1,200.
Do I need a lawyer to start an LLC in New York?
No, you can form an LLC in New York yourself, but a lawyer can help with legal advice.
What is the publication requirement in New York?
New York requires LLCs to publish a formation notice in two newspapers for six weeks.
Can I form an LLC in New York if I don’t live in the state?
Yes, non-residents can form an LLC in New York as long as they have a registered agent.
How long does it take to form an LLC in New York?
Online filings can take 1-2 business days, while mail filings may take 2-3 weeks.
