When you form a business in New York state, there are certain steps that must be followed to ensure it is legally on the books. Depending on the sort of business you are forming, you may need to register the name in a different manner or with a different entity. Whether you are a sole proprietorship, LLC, S corporation or corporation, be sure you follow the outlined rules carefully so your business can operate properly.
Register a Business in NY
When you first decide to register a business in New York, you should first decide on a business structure. Depending on the type of work you plan to do, whether you want employees, how much liability you are willing to take on and how you would like to be taxed, the structure you select may vary. In addition, you will need to decide whether you will be a for-profit or nonprofit company. Here are several options for your business type:
- S Corporation
- Limited Liability Corporation
- Sole Proprietorship
Both S corporations and corporations require you to pay yourself a salary and may or may not have other requirements, including the filing of company taxes, articles of incorporation and a board of directors. An LLC enables you to operate a business with less personal liability, but you still report income on your personal tax forms. A sole proprietorship also requires you to report taxes on your personal tax form but offers little protection from litigation. A sole proprietor may operate under a DBA, or “doing business as” name,
Choosing a Sole Proprietorship
If you are opting for a sole proprietorship, you may wish to contact your county clerk. In New York state, DBA filings are done at the county level. You will likely need to pay a small fee and file paperwork stating that you plan to run a sole proprietorship and do business under a certain name. This can be your personal name, like DBA John Smith, or a company name, like DBA John Smith Tax Preparation.
A NYS DBA name search is an important place to start. Typically, counties recommend you search this online, public database yourself before choosing a business name. They do not typically do this for you, and your application may be rejected (and your fee lost) if you select a name that is taken, so be sure to check business name availability in NY. The DBA certificate you get after a completed application is also called a "certificate of assumed name."
Choosing an LLC
LLCs are an excellent choice for first-time small business owners. They allow small business owners some protection from personal liability, like in the case of a corporation, but all income earned is reported on your individual tax return. You should still start your search by looking at public records to ensure the name you choose is not yet taken.
You can easily file an LLC via New York state’s government site, which walks you through the process in a very easy-to-follow way. There is also a fee associated with this transaction. You will also need to adopt articles of organization and an operating agreement.
Choosing a Corporation
Whether you choose a corporation or an S corporation, you can register your business name with the New York State Division of Corporations, State Records & UUC. You may wish to involve a lawyer in this process, as it can be complicated. You will need to file articles of incorporation. In addition, you will need to be sure that you have the proper business structure to file taxes for your company independent of your personal income taxes.
Note that if you operate certain kinds of businesses, you might need a business license or permit. This is a separate issue from your business name or designation.