How to Start a Business in New York Checklist
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How to Start a Business in New York:
There is support for new small businesses and entrepreneurship in New York. In 2016, New York lending institutions issued 417,765 loans under $100,000. The state offers many business development programs like START-UP NY, a program that offers eligible businesses the opportunity to operate tax-free for ten years when partnered with academic institutions, and the Empire State Development’s Small Business Division, which offers guidance to businesses with fewer than 100 employees through a range of programs and initiatives.
Form your business.
Review New York State formation options.
New York State offers 4 ways of forming your business. Review these closely and pick the one that fits your business best.
Name your business.
When you have a business name in mind, you should search the name in the DOS Business Entity Database to see if it has already been registered.
You should also check the trademark database to see if the name you have in mind has been trademarked.
If you need help finding a business name, be sure to check out NameSnack's free business name generator.
Get an Employer Identification Number.
Nearly all businesses will need to register for federal taxes by applying for an employer identification number.
Register your business in New York State.
Register your business.
You can register most business types online, aside from registering a sole proprietorship.
Apply to become a Limited Partnership by filing a Certificate of Limited Partnership.
To register a sole proprietorship in New York, you need to purchase an assumed name certificate or DBA from a legal stationery store. The fee for filing the assumed name certificate is $25.00, except for the five counties of New York City. These counties cost $100.00.
Apply to become a Limited Liability Partnership by filing a Certificate of Registration.
To register as an LLC you must file articles of organization with the New York Department of State.
To register as a Corporation you will need to file a Certificate of Incorporation.
To form an S Corporation, a C Corporation must file Form 2553 with the IRS.
Register your business for taxes.
Register for Bulk Sales Tax.
When you purchase an existing business, or purchase a business's assets, this is referred to as a bulk sales transaction. If the business was registered for sales tax, you will need to submit an Application for a Sales Certificate of Authority with the DOS.
Register for Corporation Tax.
If you register as a corporation you will need to pay corporation tax. There are different categories of corporation tax listed by the DOS, so refer to their list to find the appropriate application form.
General corporations will have to file Article 9-A.
Hire employees and report them to the state.
Report new hires.
You are required to report new hires to the state. You can use an online tool to report new hires.
Purchase disability insurance.
You need to purchase disability insurance if you have more than one employee for a period of at least 30 days. You should post a Notice of Compliance (Form DB-120) to let employees know that you contribute to disability insurance.
Get workers' compensation insurance.
Employers can purchase workers' compensation insurance through private insurers, the State Insurance Fund, or getting permission from the Workers’ Compensation Board to become self-insured.
New York State Business Types:
1. Sole Proprietorship.
Sole Proprietorship means that the business owner controls all aspects of the business, and takes on all debts personally. All income and expenses are filed on the owner's income tax return.
To register a sole proprietorship, all you need to do is get the licenses and tax identification numbers required by the federal, state, or local government. If you will be using a business name that is not your full name, you will need to file a Certificate of Assumed Name with your local county clerk.
A general partnership is when two or more people own and operate a business. These partners both contribute to capital and manage the business as equals. Each partner is also responsible for the debts.
A partnership is not taxable, but partners will need to file income and expenses on federal and state “information” tax returns. A tax advantage of a partnership is that profits and losses are taxed at an individual income tax rate.
3. Limited Liability Company.
A Limited Liability Company (LLC) has the benefit of liability protection that you would receive as a corporation, but without the double taxation. Similarly to a partnership, business owners can manage the business.
To register as an LLC, you must file articles of organization with the DOS, Division of Corporations. Filing fees and statutory requirements will apply. After a company has filed articles of organization it will have to publish in two specified newspapers and receive an affidavit from these newspapers as proof of publication. These affidavits will have to be submitted to the DOS along with a certificate of publication form.
A corporation can be owned by many people but it operates as one entity. Registering as a corporation automatically makes your business a C Corporation. To become an S Corporation, you will have to make an additional application.
A corporation benefits from being able to sell shares to investors as a means of earning capital. A corporation is run by an elected officer instead of business owners.
How do I get a business license in New York State?
Once you've formed a legal entity and registered with the Secretary of State, Division of Corporations, visit the New York State License Center online to find out what state, local, and professional licenses you need. You can apply for the licenses online.
How much does it cost to start a business in New York?
It costs $250.00 to set up an LLC in New York State, but that isn't counting the costs of publishing Articles of Organization in two newspapers.
Do I need to register my business in New York?
Yes, depending on the type of business you plan on starting you will need a set of licenses and permits. There are federal, state, and local licenses and permits to obtain before opening a business in New York.
How do I start my own home business in NY?
- Decide on a business structure.
- Choose a business name.
- Register the business.
- Get your Federal Employer Identification Number.
- Open company accounts: bank and credit cards.
- Get business licenses and permits.
How do I start a cleaning business in NYC?
- Create a budget.
- Select a business structure.
- Obtain licenses and business insurance.
- Purchase cleaning equipment.
- Determine your rates and your business model.
- Market your cleaning business.
How much is a vendor's license in NY?
A New York City general street vendors' license costs $100.00.
Where do I go to get a vendor's license?
You will first need to obtain four permits:
- Sales tax permit from the state government's revenue agency.
- Tax ID number from the local government's revenue agency.
- General business license from the city or county clerk's office.
- Additional vendor license from the city or county government.
How long does it take to incorporate in NY?
Processing your New York Articles of Incorporation will take between 2 and 4 weeks if you file by mail. You do have the option of requesting a shorter processing time by paying a $75.00 fee.
What do I need if I want to form an LLC in New York?
- Choose a name.
- Make sure that the name is available.
- Check to see if a domain is available for your business's name.
- Choose a registered agent.
- File Articles of Organization.
- Publish Articles of Organization.
- File Certificate of Publications.
- Create an operating agreement.
How do I start an S Corp in New York?
- Choose a name.
- File Certificate of Incorporation.
- Appoint a registered agent.
- Set up a corporate records book.
- Set up your corporate bylaws.
- Appoint initial corporate directors.
- Hold the first Board of Directors meeting.
- Issue stock to shareholders.
- File biennial report.
- Comply with all tax and regulatory requirements.
What are the best banks for small businesses in New York?
- Wells Fargo.
- Capital One.
- Bank of America.
What do I need to apply for a Sales Tax Certificate of Authority?
- Reason for applying.
- Contact information for the business.
- Entity type.
- Date business begins.
- Bank account information.
- License numbers.
- Business contacts and responsible persons' information.
What new hire information is needed in New York state?
- Employee's name (first, middle initial, and last).
- Employee's address (street, city, state, and ZIP code).
- Employee's Social Security number.
- Employee's hire date.
- Employer's name.
- Employer's address (street, city, state, and ZIP code).
- Employer's identification number.
- Employee's health insurance benefits (if applicable).
What permits do I need to start a business in New York State?
- New York Business License and/or Tax Permit.
- Building Permit.
- Health Permit.
- Occupational Permit.
- Signage Permit.
- Zoning Permit.
Do I need to publish my LLC?
Yes, the State of New York requires all businesses to publish Articles of Organization in two newspapers. Proof of publication is needed for finalizing registration.
How long does it take to get an LLC in New York?
It can take up to 4 weeks for an LLC to be processed. Some registered agent services can expedite the process.
What taxes does a New York State LLC pay?
Most LLCs are pass-through tax entities, so they do not pay income taxes themselves. Instead, tax responsibilities fall on the individual LLC owners and members. New York does require an annual filing fee from LLCs, which can range from $25.00 to $4,500.00, depending on gross income.
How can I start a food business in New York?
- Decide on what type of food business it is you want to start.
- Form a business entity.
- Apply for an EIN.
- Secure funding.
- Open a business bank account.
- Register for tax.
- Find a location.
- Get licenses from the Division of Food Safety and Inspection.
- Hire employees.
- Source ingredients.
- Buy equipment.
- Get insurance.
- Market your business.
Is New York State a good place to start a business?
Depending on the type of business you want to open, starting a business in New York State can be a good idea. Be sure to research the types of legal entities and choose one that works best for your business size and desired structure.