What steps do I need to take to form a limited liability company (LLC) in New York and what are my responsibilities as an LLC owner?
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To form a limited liability company (LLC) in New York, you will need to take the following steps:
- Choose a name for your LLC: Your LLC name must be unique and distinguishable from other registered LLCs in New York State. You can check if your desired name is available by conducting a search on the New York State Department of State's website.
- File Articles of Organization: You must file Articles of Organization with the New York State Department of State. The filing fee is $200. You can file your Articles of Organization online or by mail. In your Articles of Organization, you will need to include the name and address of the LLC, the purpose of the LLC, the name and address of the LLC's registered agent, and the names and addresses of the LLC's members or managers.
- Obtain Required Permits and Licenses: Depending on your business type and location, you may need to obtain a variety of permits and licenses. The New York Business Express website provides resources for determining which ones you may need.
- Draft an Operating Agreement: An Operating Agreement is a binding document that outlines the rules and procedures of your LLC. This should include matters like the purpose of the LLC, the roles and responsibilities of members or managers, distribution of profits, decision-making processes, and procedures for adding or removing members.
As the owner of an LLC in New York, your responsibilities include:
- Complying with all relevant laws and regulations.
- Paying taxes on behalf of the LLC.
- Maintaining accurate financial records.
- Filing annual reports with the New York State Department of State.
- Meeting regularly with your LLC members or managers to make decisions and review the LLC's finances.
- Following the rules and procedures outlined in your LLC's Operating Agreement.
It's important to note that LLCs are generally designed to protect their owners from personal liability in the event of legal or financial problems with the business. However, there are potential limitations to this protection, particularly if the LLC is found to be engaging in fraudulent or illegal activities. Additionally, LLC owners may still be held personally liable for certain debts or obligations if they personally guarantee them or engage in actions that breach their duty of care or loyalty to the LLC.
If you have any questions or concerns about forming or operating an LLC in New York, it's wise to consult with a licensed attorney for further guidance.
