Forming a New York limited liability company can leave small business owners several hundred or thousand dollars short if they get caught up in the complex state registration cost structure.
Why such a gap in costs?
Because in the state of New York, your company’s location, services portfolio, and overall business entity structure affect the final costs of registering and operating a limited liability company.
This guide provides a detailed lowdown of costs you’ll incur as a New York LLC owner.
Table of contents
- New York LLC formation cost: $200 + publication fees
- Extra New York LLC costs to account for
- Does New York have an annual LLC fee?
- Conclusion: How much does an LLC cost in New York?
New York LLC formation cost: $200 + publication fees
To form an LLC in New York, you’ll need to file the Articles of Organization with the New York Department of State.
- State fee for Domestic LLC formation: $200
- State fee for Foreign LLC formation (called an Application for Authority): $250
Businesses that have their primary place of business in New York pay a lower fee. Companies whose primary place of business is in another state but want to conduct business in New York must pay a $250 state filing fee and register as a foreign limited liability company.
Applications are processed online, in person, and by mail. For the latter, processing times can take 6 weeks or longer if there’s a backlog.
But you can pay an expedited handling fee to speed up the processing of your business registration:
- $25 — receive company formation documents within 24 hours
- $75 — for same-day service if the documents are submitted before 12.00 pm
- $150 — within 2 hours if the documents are submitted before 2.30 pm
Notice of Formation Requirement and Publication Fees
New York is one of the states requiring LLC owners to publish a notice of the formation or a copy of the Articles of Organization in the state circulating newspapers.
The information must be included for 6 consecutive weeks in two different newspapers.
The County Clerk determines which newspapers you need to publish based on the county where your business is located. One newspaper must be daily, the other must be weekly, and both must be located in the same county as your LLC’s primary place of business.
This requirement adds to extra costs to LLC formation:
- Newspaper publication fees: vary
- State fee for Affidavit of Publication: $50
Unsurprisingly, publishers in the New York state don’t shy from charging LLC owners some round sums. LLC publication costs range from a couple hundred to a couple of thousand dollars.
The exact amount depends on the county and whether your LLC is a domestic or foreign business entity.
Forming a New York LLC in Allegany County can be as low as $50, but starting an LLC in New York or Bronx County can be as high as $2,100 for a foreign entity.
Some professional service providers also offer to handle the newspaper publications for you for an extra cut.
After running your ad, the newspaper is obliged to give you a Certificate of Publication, also called an Affidavit of Publication. You must then file the certificate with the New York Department of State along with the $50 fee.
Certificates of Publication must be filed within 120 days of forming the LLC.
To form an LLC in New York, business owners can expect to pay $250 in state fees (plus credit card processing fees). And then file the bill for the publication costs.
The biggest variable in total costs is the publication costs that newspapers charge, which can be a few hundred or a few thousand dollars depending on where the business is located.
Can LLCs escape the Newspaper Publication Requirement?
No. It’s a legal requirement for newly-formed LLCs in New York, both for single-member and multi-member LLCs.
LLC filers that fail to submit the publication affidavit within 120 days of forming the LLC can’t do business in the state.
Extra New York LLC costs to account for
The Articles of Organization is the cornerstone document you need to start an LLC in New York.
But in reality, most business owners incur other costs when forming a business entity. Some of them are optional, while others are mandatory.
Registered agent fees
A registered agent is a person or business that will receive legal and tax documents on behalf of your business. Annual registration reminders and subpoenas are common things a registered agent should be prepared to handle.
Since such a delicate service of process mail must be handed in person, a registered agent must be available at the registered street address during business hours every day.
To ensure that important correspondence always reaches you, you can hire a professional agent for the service of process. The ballpark annual cost of a registered agent service in NY is $100.
However, some small business owners choose to serve as their own agents instead of paying for a professional service.
Keep in mind that by doing so, you commit to:
- Having your home address known to the others
- Being available at the specified business location at all times
You must also make sure that you update this information with the New York Secretary of State if you move or change registered agents. To do so, you’ll need to file a Certificate of Change form and pay a $30 state fee.
Trade name registration
If you intend to operate your business under a name that’s different from the legal name listed on your Articles of Organization, you must register for a trade name.
Obtaining a separate trade name also makes sense if you plan to launch a new product or service under your LLC.
For example, if the name of the LLC is “Plant Nursery LLC,” but you plan to have both a nursery and teach courses about plants, you could register your LLC as “Plant University.”
Your company name would be Plant Nursery LLC doing business as (or DBA abbreviation) “Plant University.”
While this doesn’t change the legal name of your LLC, it gives you flexibility in naming the business and can help market your business to customers.
The New York state has a two-fold price structure for assumed name registration:
- You have to pay a $25 New York Department of State filing fee.
- Then spend an extra county fee. The county filing fee is $25 for each county, except for the counties of New York, Kings, Queens, Bronx, and Richmond, for which the additional cost is $100.
See? Most LLC formation costs aren’t that straightforward in New York.
LLC name reservation fee
Another possible fee for new LLC owners is a name reservation fee.
If you’re in the early stages of forming your business but are set on having a specific name, paying the name reservation fee makes sense.
Note: A name reservation doesn’t guarantee that the state has approved your business name. It simply alerts other LLC organizers that this name is not available.
Certified document copies
Certified copies of documents such as Articles of Organization can be obtained from the New York Department of State.
There’s a $10 state fee for certified copies and $5 for plain copies.
Requests are not accepted online or by phone — they can only be requested in writing and sent, faxed, or hand-delivered to:
New York State Department of State, Division of Corporations
One Commerce Plaza
99 Washington Avenue
Albany, NY 12231
Business permits and licenses
Certain businesses and professionals require permits or business licenses to operate in New York.
Plumbers, lawyers, and hair salons are examples of regulated business entities. For example, to operate a hair salon in multiple counties in New York, the owner must have a license to occupy rental space, plus licenses for beauty services issued by the state. There are also local requirements for every county that your business operates in.
To determine which permits you may need, check the state Business Express portal. The website provides a comprehensive list of legal documents (including permits) for different types of companies.
The operating agreement for your New York LLC
All New York State limited liability companies must have an operating agreement. The copy doesn’t have to be submitted with the department of state but kept on private record. Failure to have one may result in the termination of your good standing with the state.
The cost to create an LLC operating agreement varies on whether you want a custom legal document to be drafted by a professional attorney or can do with a pre-made generic template purchased online.
Federal and state LLC taxes
On a federal level, an LLC is treated as a disregarded entity for tax purposes by the IRS. It means that all company profits pass through to your personal income tax return.
As a single-member LLC, you’ll be reporting your taxes as a sole proprietorship. You don’t even need to obtain an employer identification number (EIN) from the IRS unless you hire workers. However, having one may be better for opening a business bank account.
On the state level, however, LLC taxes are a bit more complex. While New York state doesn’t levy a “classic” franchise tax, they charge a variation of it.
All LLCs operating in the state that had a gain, loss, or deduction from New York State sources during the taxable year, must file an annual report (Form IT-204-LL) and pay an applicable state fee starting at $25. To file this form, you’ll need to either provide your EIN or social security number.
LLC or LLP filing fee table
Here’s a New York annual filing fee table for LLCs. From the New York Department of Taxation and Finance.
If the New York source gross income of an LLC or LLP for the preceding tax year is more than:
|but not more than:|
the filing fee is:
The only way to opt-out of this progressive fee is to change your LLC tax classification to a corporation for federal income tax purposes.
Also, you may be required to collect and pay sales tax in New York state. Again, there are progressive rates involved, which also differ depending on your business location.
For example, if you sell footwear in New York City, products under $110 are exempt. But all items above $110 are subject to a 4.5% NYC Sales Tax and a 4% NY State Sales Tax.
Contact your local tax authority to determine your obligations.
Does New York have an annual LLC fee?
Yes. All LLCs in New York must file an annual report which is also a state tax reporting form. The fee starts at $25 and can go as high as $4,500 based on the owners’ gross income generated in New York.
Conclusion: How much does an LLC cost in New York?
Forming an LLC in New York starts at $250 for obtaining Articles of Organization and Addafit of Publication from the state.
But the costs of this business structure can quickly go into thousands, depending on your approach to company formation.
The business location, industry, and levels of privacy that owners want will influence the final LLC formation costs.
Here’s a sample calculation for a plumber who works in Allegany county vs. Kings county. The cost can change drastically based on where the business is located.
State filing fee
Registered agent service
Trade name reservation
|Plumber license, New York State||$300|
If you expect to use a professional LLC formation service, add several more hundred dollars to the above total.
Maintaining annual compliance with New York LLC requirements will start at $25 for a business making less than $100,000 in gross income that doesn’t require special licensing and no third-party registered agent. This $25 fee covers the required annual LLC fee.
Consult with a CPA or attorney to discuss your options to ensure that you’re aware of and prepared for the cost of doing business in New York City and New York State.