A limited liability company (LLC) is a popular choice for structuring a business because it combines many of the favorable characteristics of a partnership with some of the more desirable features of a corporation. These characteristics include limited liability for all of the LLC’s owners, who are called members, and pass-through taxation, which means that the LLC’s profits are only taxed as part of the members’ income and not as a separate entity. An LLC formed in New York must comply with the New York Limited Liability Company Law.
New York has several requirements for LLCs that are enforced by the New York Secretary of State. Even though an LLC does not need to be formed by a member, it needs to have at least one member. The name for an LLC that does not offer a professional service must include “Limited Liability Company”, “L.L.C.”, or “LLC”. If the LLC does offer a professional service, such as veterinarian medicine or dentistry, then the name may end with ”P.L.L.C.”, “PLLC”, or “Professional Limited Liability Company” instead. Additionally, the name must be distinguishable from other existing names for companies that are registered in the state. There are also several words and phrases that are not allowed to be included in an LLC name in New York, such as “urban development,” “corporation”, and ”lawyer”. A comprehensive list of these prohibited words and phrases can be found in Section 204 of the New York Limited Liability Company Law.
An LLC is also required by New York law to adopt a written Operating Agreement establishing rights and duties of the members within 90 days of existence. Another thing an LLC must decide on is which county under whose jurisdiction it wants to be. In order be able to operate your company as an LLC in New York, you will also need to file the correct paperwork with the New York Secretary of State. Once you have filed all of the necessary paperwork, you must publish a notice of the LLC’s existence in one weekly newspaper and one daily newspaper for six consecutive weeks, unless the LLC is a theatrical production company.
To register an LLC in New York, an organizer must file the appropriate paperwork with the Division of Corporations, State Records, and Uniform Commercial Code of the New York State Department of State. There are different paperwork requirements for standard domestic LLCs, domestic professional services LLCs, standard foreign LLCs, and foreign professional services LLCs. An LLC is domestic when it has originated New York, and it is foreign if it was first established in another country or state.
A standard domestic LLC must file Articles of Organization, while a domestic professional services LLC must file Professional Services Articles of Organization. Both forms have many of the same information requirements. To complete either form, you will need to provide:
- The name of the LLC
- The county where the LLC will maintain its primary office
- A reliable mailing address for the LLC where copies of legal documents given to the Secretary of State for the LLC can be sent
- The signature of the person or entity organizing the LLC
- The address of the entity or person filing the Articles of Organization
For the form for Professional Services Articles of Organization, you will also need to list the profession in which the professional services LLC will be engaged and the names and address of any people and/or registered professional companies, including the names and addresses of the owners and managers/directors of those companies, who will be original members or original managers of the LLC.
Just like with domestic LLCs, there are separate forms for standard foreign LLCs and foreign professional services LLCs. The former must complete an Application for Authority, and the latter must file a Professional Services Application for Authority. To complete an application for Authority, you will need to list the LLC’s original name, its alternative name if the original name does not meet New York’s naming requirements, where and when it was originally formed, the county under whose jurisdiction it would like to fall, and its mailing and principal office addresses. The form will also need to contain the name and address of the government entity with which the LLC originally registered with in the location where it was created, as well as the signature and address of the filer.
For a Professional Services Application for Authority, you will be required to put down the LLC’s name, its alternative name if the original name fails to meet the name requirements set forth by New York law, when and where the LLC was originally created, the type of profession the LLC will be practicing, the city and county in New York where the LLC’s office will be located, and the LLC’s mailing address. Each of the professionals involved in the LLP will need to provide their name, address, and New York State license number, if they have one. Whoever is filing the Professional Services Application for Authority will also need to sign it and give their address. Both standard foreign LLCs and foreign professional services LLCs will also need to file a Certificate of Existence at the same time as their Applications for Authority. All LLCs will also need to file a Certificate of Publication once they have finished publishing the required notice.
Unlike most states, New York does not require LLCs to have a registered agent. Rather, the Department of State serves as the agent for all LLCs within New York, meaning that it is one less thing that you need to worry about when looking to register your LLC in New York.
Each LLC in New York must file a Biennial Statement every other year. Failing to file a Biennial Statement will result in the failure being reflected on any certificates of good standing that the LLC may request and may even result in the LLC being charged a $250 late fee.
Forming or registering an LLC in New York can be complicated. Thus, you should seek the assistance of a New York business lawyer when you are looking to establish an LLC in New York.