Benefits of Forming an LLC in New York

Limited Liability Protection

当a business owner has limited liability protection, they can't be held personally responsible if the business suffers a loss. This means personal assets (car, house, and bank account) are protected.

In order to have limited liablity protection, the LLC must maintain itscorporate veil.

Pass-Through Taxation

A New York LLC’s profits go directly to its owners, who then report their share of the profits on their individual tax returns. The business is not taxed directly and profits are only taxed once. This is known aspass-through taxation.

In a New York C corporation, profits are subject to "double taxation". This means profits are taxed before being distributed to owners and taxed again when owners report their share of profits on their individual tax returns.

Tax Options

A limited liability company can choose among three different ways of paying income tax. One option is to be taxed as anS corporation. Technically an S corp is a tax designation, not its own type of business entity.

You can learn more about choosing the S corporation tax designation in ourLLC vs S Corpguide.

Simplicity

Limited liability companies are relatively easy to form and maintain with little paperwork or expense. Unlike C corporations, New York LLCs aren’t required to assign formal officer roles, hold annual meetings, create bylaws, or record company minutes and resolutions.

Visit our在纽约成本形成一金宝搏188是什么公司个有限责任公司guide to learn more about the expenses for setting up and maintaining an LLC.

Ownership Flexibility

There are very few restrictions on how you can structure the ownership and management of a New York LLC:

• Your LLC can besingle-memberormulti-member
• A Multi-Member LLC can be managed by its members, termed as member-managed
• A Multi-Member LLC can be managed by a manager that is appointed by its members, termed as manager-managed

Learn more about LLC management in ourmember-managed vs manager-managedLLC guide.

Increased Credibility

Forming your business as a limited liability company brings added credibility. An LLC is recognized as a more formal business structure than asole proprietorshiporpartnership.

Including LLC in your business name lets customers and partners know that you are a credible business.

Name Registration

当you form an LLC, you’ll choose a unique name that will be registered when the LLC is formed. By registering your name, no other businesses in New York will be able to use the name while your business is active.

A sole proprietorship or partnership must use the names of the owner(s) as the business name. A sole proprietor or partnership would need to register a doing business as name (DBA) in order to use something besides their personal name.

Five Basic Steps to Start an LLC in New York

Step 1: Name Your LLC

你需要给你的业务一个惟一名称that is distinguishable from all registered names in New York when you file your Articles of Organization.

OurBusiness Name Generatorand ourHow to Name a Business in New Yorkguide are free tools available to entrepreneurs that need help naming their business.

Step 2: Choose a Registered Agent

YourNew York registered agentwill accept legal documents and tax notices on your LLC's behalf. You will list your registered agent when you file your Certificate of Formation or the Secretary of State will act as your agent for service of process/registered agent.

Step 3: File the Articles of Organization

TheArticles of Organizationis the document you will file to officially register an LLC with the Secretary of State.

Step 4: Create an Operating Agreement

ANew York operating agreementis a legal document that outlines the ownership and member duties of your LLC.

Our118bet官网 is a free resource for business owners.

Step 5: Get an EIN

AnEmployer Identification Number(EIN) is a number that is used by the US Internal Revenue Service (IRS) to identify and tax businesses. It is essentially a Social Security number for a business.

EINs are free when you apply directly with the IRS. For more information about whether your LLC is required to obtain an EIN, visit ourEIN for LLCsguide.