New York, being capital of the US is home to great economic prospects but getting your business registered in New York is not a piece of cake, and the requirements are strict as compared to other states of the US. Also, the New York Secretary of State can reject the filing application for trivial reasons. Therefore a thorough review of the filing documents is recommended at each step before the documents are submitted to the Secretary of State.
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Setting up a Business in New York
Setting up a business in New York comprises of steps below. Various sources are available to accomplish the procedure.
Select the Type of Business Entity
New York allows for multiple options of business structures to choose from. The type of business structure in New York should be carefully decided as each one is subject to various requirements. Therefore legal advice may be sought in this regard.
- Sole Proprietorship: where only one person runs a business and is responsible for all its liabilities.
- Partnership: where two or more people run the business and are jointly responsible for its liabilities depending on the ratios decided in the partnership agreement.
- Limited Partnership: It is the same as the normal partnership except the fact that the limited partners are to bear the obligations of the business only to the extent of their capital decided in the Limited Partnership Agreement
- Nor-For-Profit Organization: where the motive of business is to serve a social purpose and not to earn a profit.
- Limited liability Companies: where the structure is less formalized than a company, but the liability of the owners is limited.
- Business Corporation is an entity separate from its owners. Thus the shareholders are not responsible for company liabilities. It has proper formalized and highly governed structure.
Choose a Name for the Business
Naming the business in New York is comparatively complex as there is a long list of words that are subject to restriction. Some words even require prior approval of the Attorney General. Therefore care should be taken as the application could be rejected even due to the name.
Registration of Company
The registration process in New York is comparatively cumbersome.
- Before beginning the filing process, the company intends to do business should get its business purpose approved by other states. There is a specific list of business purposes provided that require approval.
- The hiring of a registered professional agent is an option in New York as the Secretary of State acts as the professional agent.
- File articles of organization in case of the LLC and Articles of incorporation in case of a corporation with the secretary of State. If the business is LLC or a limited partnership, then it must give notice of its formation in two newspapers of the country for six consecutive weeks and then file for registration.
- Hold an organization meeting and constitute a membership (for LLC) or shareholder agreement (for a corporation).
- Allot membership and shareholder certificates.
Employer Identification Number (EIN)
This is a nine-digit number unique for every business and is granted by the Internal Revenue Service. It serves as an identity for businesses operative in the United States.
Open Company Bank accounts
Get your account opened in a company for effective fund management.
Obtain permit or License to run the Business
Once the business is registered, obtain a license or permit to work smoothly in New York. The nature of permits depends on the business processes.
Business Startup for Non-Resident
For a Non-resident registration of business is allowed provided he operates the business remotely, but for him to actively manage the business from New York, he must get a work visa so that there are no legal implications.
Fee for Company Registration in New York
Registration fee varies depending on the business structure that you chose to create. For example, a corporation would pay an amount of $125 for a certificate of incorporation while a not-for-profit organization will pay $75 for the same.