Forming the LLC
Naming your LLC
The following are some requirements for your LLC's name:
- The name cannot include words such as Bank, Insurance, Corporation, etc.
- You must chose a name different from another LLC registered in the Division of Corporations
- The name must end with "Limited Liability Company", "Limited company" or an abbreviation such as: LTD. Liability Co., L.L.C., LLC.
Name Search
You can do a name search on the website http://appsext5.dos.
state.ny.us/corp_public/corpsearch.entity_search_entry
A oficial name search can be conducted by writing a letter (no official format) accompanied by a $5 fee and sent to the NYS Division of Corporations.
A credit card authorization form can be found here
(http://www.dos.state.ny.us/corp/busfile.html)
Filing the Articles of Organization
You can get a blank article of organization for your New York City based business from New York state's filings office or their web site. In this document you provide the LLC address, name of the owners, and list the address of a person called the registered agent. The Registered Agent is the person who receives the legal paperwork for your LLC.
The Articles of Organization is not actually a form and it does not have a standard format. You can a obtain a simple version of it from NYS Division of Corporations and use it to incorporate your business
http://www.dos.state.ny.us/
Or
http://www.dos.state.ny.us/corp/llcfile.html
You should mail or deliver the forms accompanied by the fees to:
NYS Department of State,
Division of Corporations,
State Records and Uniform Commercial Code,
41 State Street, Albany, NY 12231
Publishing your LLC notice
New York requires that you publish a notice in an approved local paper to set up your business as a LLC. In New York once you register your LLC you should call your local county clerks office to obtain a list of qualified publications where you can publish and receive your Certificate of Publication. Your local county clerk's office would be the county of your business address. Be warned, the cost of publishing the notice is expensive in Manhattan.
New York requires that you publish a notice in a approved local paper to set up your business as a LLC. Once you register your LLC you should call your local county clerks office to obtain a list of qualified publications where you can publish. Your local county clerk’s office would be the county of your business address.
Brooklyn_____________________________________
Supreme Court Building, 360 Adams St., Room 189
Brooklyn, NY 11201(718) 643-8012
Bronx________________________________________
851 Grand Concourse, Room 118,
Bronx, NY 10451 (718) 590-6088
Manhattan____________________________________
Supreme Court Bldg, 60 Centre St., Room.103B,
New York, NY 10007 (212) 374-5703
Queens______________________________________
88-11 Sutphin Blvd., Room 106,
Queens, NY 11435 (718) 520-3137
Staten Island_________________________________
130 Stuyvesant Place, 1st Floor,
Staten Island, NY 10301 (718) 390-5389
Exceptions to Personal Liability
As with corporations, there are certain exceptions to the limited liability protection afforded by the LLC:
- The LLC defaults on a loan that an owner personally guarantees.
- The managers do not deposit the taxes withheld from employee wages.
- A member injures someone.
- The owner does not separate the corporation as an independent entity; that is, the owner does not separate business from personal matters.
- Illegal activities are not afforded limited liability protection.
An LLC will not be characterized as an extension of the owners' personal affairs (owners may lose the limited liability protection) if the owners adhere to the following corporate formalities:
- The LLC has an operating agreement in place
- The owners make an adequate investment in the company
- The LLC maintains business records and transactions separate from the owners
- The owners manage the LLC legally, and are not concealing any relevant or important information to investors, creditors or vendors
Things to remember:
- It is important to create an LLC operating agreement to officially establish the member's rights and responsibilities.
- You can declare the gains on your personal income taxes. However, you can also choose to pay taxes as a corporation.
- An LLC affords you the tax & management flexibility of a partnership/single proprietorship and the limited liability protection of a corporation
- The LLC allows you to do special allocations for profits and losses that are not proportional to the owner's investment. However, you need to comply with the IRS allocation rules
For more information on managing your LLC proceed to the next section. Managing your LLC
