Choosing to start a new company is both exhilarating and terrifying. It’s the first of many choices you’ll have to make along the path. Depending on where you reside, you may need to register your company at the state, municipal, and federal levels. This article will assist you through the process of registering your company in New York.
Establishing a Business in New York
1. Name Your New York Company
Naming a new company may be a difficult job for many people. The name should be memorable, letting people know what you have to offer. A strong name, on the other hand, is much more than that. It is a branding tool that provides an inside peek into your organization’s purpose and future goals. The correct name may help you set yourself up for long-term success; the wrong name can destroy a ship before it ever sets sail.
Considering Your Name
While many entrepreneurs are inclined to speed through the name process, you should take your time and investigate all naming options. Take multiple brainstorming sessions and utilize the free internet business tools available today to assist you come up with a variety of choices, narrowing them down as you go.
Our company name generator is a fantastic, industry-specific brainstorming tool that will not only help you come up with the right name, but will also verify domain name availability for you. If you’re still unsure where to begin, our name guide may help you establish your brand and provides practical recommendations for brainstorming sessions.
Name Lookup in New York
To find out which names are available, use the New York Department of State’s business entity database tool or submit a written name availability request. You should also make sure that your name isn’t too similar to any existing firm in your state. This will assist to prevent future misunderstanding and legal problems.
It’s time to start legitimizing your firm once you’ve chosen a name that appropriately portrays your brand. These following procedures will differ based on your company structure and the legal requirements of your state. The next section will go through the various company structures.
2. Select a Business Structure for Your New York Company
Now that you’ve picked a good name for your brand, it’s time to start the legalization process. Before you begin the registration procedure, you must decide which company structure is appropriate for you. Each has its own set of perks, drawbacks, and tax advantages.
The sole proprietorship
A single proprietorship is the simplest straightforward business form. This informal corporation was created for entrepreneurs who do not want to work with others. It provides no personal asset protection and does not need state filing.
In New York, you may run your sole proprietorship using your surname or under an assumed name. In New York, the fee and processes for registering a DBA differ by county and must be submitted with the county clerk. A list of county websites is available on the New York State website.
A general partnership, like a sole proprietorship, is an informal structure established for entrepreneurs who form a partnership with at least one other person. You and your partners’ surnames may be used for the firm, or you can get a DBA name. Profits and losses would be reported on your (and your partners’) personal tax return, and no personal assets would be protected.
Some partnerships (such as limited partnerships and limited liability partnerships) in New York are required to submit formal papers with the state, along with a filing fee.
If you do not intend to go public in the foreseeable future, a limited liability corporation (LLC) may be the best option. It provides more freedom and protects your personal assets in the case of a lawsuit.
The state of New York requires all LLCs to have a registered agent who accepts legal paperwork on their behalf. While the state serves as a company’s registered agent by default, you may appoint your own as long as they are a qualified New York person or a corporation permitted to do business in New York. Many new LLCs choose to use a registered agent service, which costs between $29 and $300 each year.
In addition, New York requires you to follow particular name guidelines and submit the Articles of Organization, which include important information about your business.
An operating agreement is also necessary for New York LLCs.
Furthermore, New York LLCs are required to publish a copy of their Articles of Organization in two qualified newspapers and submit a Certificate of Publication with the state. The cost of publication varies per newspaper, but the Certificate of Incorporation is $50.
A corporation is a kind of business entity for those who have (or want to have) shareholders. So, if you want to go public in the future, this may be the greatest alternative for you.
Corporations, like LLCs, must designate a registered agent to receive paperwork, compliance papers, and government communication on the organization’s behalf. Your registered agent, like an LLC, might be a professional service, a corporate organization, or a person.
You will also need to submit a Certificate of Incorporation with the state in addition to obtaining a registered agent.
3. Determine whether your company has to be registered in New York.
Once you’ve decided on your formal company structure and registered your new business name, you need check with your state to see what the criteria are for business registration. Each state has its own set of rules, which must be strictly followed.
Most informal company arrangements, such as sole proprietorships and general partnerships, do not need to be registered with the State of New York. Check with your local government to discover whether your sole proprietorship or general partnership has to be registered at the county or municipal level.
Furthermore, certain firms (for example, sole proprietorships and single-member LLCs with no workers) are exempt from registering and filing for a Tax ID Number, also known as an Employer Identification Number (EIN), with the IRS. Even if this is not a necessity for your company, you should consider registering regardless since there are various legal and tax advantages.
Even though you are not compelled to register your firm, it is important to recognize that creating an LLC has several legal and financial advantages. Your business debts are considered personal debts if you are a single proprietorship or a partnership. This implies that in the case of a lawsuit, your personal assets might be taken. Personal protection is provided through LLCs, which legally shield your personal assets and minimize your personal liabilities.
Aside from personal protection, LLCs have various additional advantages, including:
Profit distribution, decision-making, and company management flexibility
“Flow-through” taxes permits the LLC’s revenue and costs to pass through to the owners’ personal income tax returns, with no limits on the number and type of owners.
If you don’t have the time or skills to organize your own LLC, there are a variety of trustworthy LLC filing services that may assist you. We analyzed and selected the five finest LLC registration services because we realize how difficult it can be to navigate through the thousands of accessible alternatives. Our LLC service review compares each to ensure you associate with a service that saves you both time and money.
4. Register Your New York Business for Taxes
EINs are used by the IRS to identify firms for tax purposes. Every company with workers is obligated to have one. Our EIN guide will assist you in determining the EIN requirements for your company structure and will coach you through each stage of the procedure.
Once you’ve obtained your EIN, you’ll need to register with the Department of Taxation and Finance to pay state and employer taxes. If you intend to sell tangible goods, you must pay a sales and use tax on the total price of all goods sold.
Entity- or industry-specific taxes, such as corporation taxes, property taxes, or highway use taxes, may also apply to your new business. A complete list of business tax registration requirements can be found on the website of the Department of Taxation and Finance.
5. Get Permits and Licenses for Your New York Company
The state of New York’s licensing and permit requirements vary depending on your location and industry. A beauty salon, for example, may be required to apply for permits from the New York Department of Health and the state’s Professional Beauty Association. Check out the New York Business Express website for a complete list of professional licensing requirements, applications, and forms.
Furthermore, certain businesses are governed by a federal agency and need federal licenses and/or permits. A liquor company, for example, would be subject to FDA standards and recommendations. Visit the Small Business Administration (SBA) website to learn more about federal permit requirements and costs.