Business

LLC formation in NY – do you really need it

The NYS department of state is strict about LLC publication by the newly formed LLC. They have rules along with the list of newspaper journal that the LLC should place a publication in. In order to publicize the LLC, the newly formed LLC has to take some steps in filling forms, applications and then registering their business with the statute. Though it is a hassle and costly process and even though many businesses avoid or postpone it, the state still strict with it.For those who have not registered and completed the LLC publication, may face some penalties and can even stop their business. To avoid this and to fall under the compliance of the department of state, it is advisable to register the LLC under the department of state.Let’s look at some advantages of New York LLC formation. 

Forming an LLC involves the below steps to be followed:

  1. Choosing an available name that complies toLLC’s rules as per the state’s law is the first step for your business. The name has be different from existing LLC names indicating that it is an LLC and not including nay words that are restricted by the insurance or bank of your state.
  1. Preparing the articles of the New York LLC formation and getting an organizer to do all the paper work. An organizer can be any person or a business entity and need not necessarily be a member of the new LLC formed.
  1. It is necessary to have a registered agent for the complete process of LLC publication. This registered agent is some who agrees to accept the legal paperwork on behalf of the new LLC and hence this could be any individual or a business entity as well.

If the LLC is in Delaware, it is important that the registered agent is a resident or business entity which is authorized to do business in Delaware. It is also a must that the registered agent should have a physical address in Delaware itself.

If the LLC is in New York, the New York Department of State must be appointed as their registered agent who will take care of any legal paper work for the LLC.

  1. Creating an agreement is an internal document which clarifies the rules and regulations of smooth carrying of business, clarity on distribution of finances/profits/loses/interest percentage/credits etc. among the members of LLC is an essential document. This should be done within a maximum time of 90 days after filing the articles of formation of organization.
  1. In order to obtain licenses and permits required for the business, the LLC should obtain Employer Identification Number (EIN)from the US Internal Revenue Service (IRS) by filing a free online application on the website of IRS.
  1. Paying the state’s annual tax to your state is the next step. While paying franchise tax is a fixed amount of $250 in Delaware, while in NY, an LLC will pay tax only if it has income or gain or loss from NY and the LLC can also elect to be treated as federal income tax or corporation.

 

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