How to Form an LLC in New Jersey or New York A Step-by-Step Guide

Forming a Limited Liability Company (LLC) is an attractive option for entrepreneurs seeking a business structure that offers flexibility, liability protection, and tax advantages. While the process of forming an LLC in New Jersey and New York shares some common steps, each state imposes unique requirements that potential business owners need to navigate. Understanding these nuances can help you make an informed decision about where and how to establish your LLC. This detailed guide outlines the steps for forming an LLC in both states and highlights the key differences between the two.

What Is an LLC and Why Should You Choose It?

A Limited Liability Company (LLC) combines the liability protection of a corporation with the operational simplicity of a sole proprietorship or partnership. One of the biggest advantages of forming an LLC is that it shields the personal assets of its owners—known as members—from business debts or lawsuits.

This structure is particularly appealing to small business owners, startups, and family-run ventures because it offers flexibility in management and taxation. Unlike corporations, LLCs can choose how they want to be taxed, whether as a sole proprietorship, partnership, or S-corporation. While forming an LLC follows a similar framework across states, the specific steps and legal obligations differ significantly between New Jersey and New York.

Steps to Form an LLC in New Jersey

1. Choose a Unique Name for Your LLC

Your LLC’s name must be distinct from any other registered business in New Jersey and include one of the following: “Limited Liability Company,” “LLC,” or “L.L.C.” Choosing a unique name is not only a legal requirement but also an important part of your brand identity.

To ensure your name is available, use the New Jersey Division of Revenue’s Business Name Search Tool. Once you confirm the name's availability, you may reserve it for 120 days by filing a name reservation form and paying a $50 fee.

2. Appoint a Registered Agent

Every LLC in New Jersey must designate a registered agent. This agent is responsible for receiving legal and official documents on behalf of your business, including tax notices and court summons.

The agent must be either an individual who resides in New Jersey or a business authorized to operate within the state. Many business owners opt for professional registered agent services to ensure consistent compliance.

3. File a Certificate of Formation

To officially form your LLC, you must file a Certificate of Formation (Form NJ-REG) with the New Jersey Division of Revenue and Enterprise Services. This document includes essential details about your LLC, such as its name, address, registered agent information, and business purpose.

1. Filing Fee: $125
2. Submission Options: You can file online for faster processing or submit the form by mail. Online filings are typically processed immediately, while mailed forms may take several business days.

4. Obtain an EIN (Employer Identification Number)

An Employer Identification Number (EIN), issued by the Internal Revenue Service (IRS), acts as a Social Security number for your business. It is required if you plan to hire employees, open a business bank account, or file taxes.

Applying for an EIN is free and can be completed online through the IRS website. The process is straightforward, and you’ll receive your EIN immediately upon completion.

5. Register for State Taxes

New Jersey businesses must register for applicable state taxes, such as sales tax, payroll tax, or unemployment insurance. Registration is conducted online through the New Jersey Division of Revenue.

Depending on your business’s activities, you may also need to apply for additional permits or licenses. For example, businesses involved in food service or retail must comply with local and state health and safety regulations.

6. Draft an Operating Agreement (Optional but Strongly Recommended)

Although New Jersey does not legally require an operating agreement, it is highly recommended. This document outlines the ownership structure, roles of members, and procedures for handling disputes.

Having a clear operating agreement helps avoid misunderstandings and ensures smooth operations, especially in multi-member LLCs. Even single-member LLCs can benefit from this document as it demonstrates professionalism and provides legal clarity.

Steps to Form an LLC in New York

1. Choose a Unique Name for Your LLC

In New York, your LLC’s name must comply with state naming rules and include “Limited Liability Company,” “LLC,” or “L.L.C.” Additionally, the name cannot duplicate an existing business or use restricted terms without proper approval.

The New York Department of State’s online database allows you to check name availability. Unlike New Jersey, New York does not offer name reservations, so it’s important to act quickly once you’ve decided on a name.

2. Appoint a Registered Agent

New York LLCs must designate a registered agent or opt to use the New York Secretary of State as their agent. While this is a convenient option, many businesses prefer a dedicated registered agent to ensure timely receipt of documents.

3. File Articles of Organization

The formation of an LLC in New York requires submitting Articles of Organization (Form DOS-1336) to the New York Department of State. This document serves as your official request to establish the LLC.

1. Filing Fee: $200
2. Submission Methods: Online, by mail, or in person. Processing times can take up to four weeks, so plan accordingly.

4. Obtain an EIN

As in New Jersey, an EIN is mandatory for New York LLCs to handle tax filings and open a business bank account. The process is the same, and the IRS provides this service for free online.

5. Comply with the Publication Requirement

One of the most significant differences in New York is the publication requirement. After forming your LLC, you must publish a notice of its creation in two local newspapers for six consecutive weeks.

The newspapers are designated by the county clerk where your LLC is located. After completing this step, you must file a Certificate of Publication with the Department of State, along with a $50 filing fee. This requirement can cost between $800 and $2,000, depending on the county, and should be factored into your budget.

6. Draft an Operating Agreement

Unlike New Jersey, New York legally requires LLCs to adopt an operating agreement within 90 days of formation. This document is not filed with the state but is essential for outlining ownership, management responsibilities, and dispute resolution.

Key Differences Between New Jersey and New York LLC Formation

While the steps to form an LLC are similar, there are notable differences:

1. Filing Fees: New Jersey’s filing fee is $125, while New York’s is $200.
2. Processing Time: New Jersey offers immediate online processing, while New York may take up to four weeks.
3. Publication Requirement: New York’s mandatory publication step adds significant cost and complexity, unlike New Jersey.
4. Operating Agreement: New York requires this document, whereas it is optional in New Jersey.

Maintaining Your LLC in Both States

Annual Reports and Fees

1. New Jersey: LLCs must file an annual report online and pay a $75 fee.
2. New York: There are no annual reports, but a biennial statement must be filed every two years for $9.

Taxes

Both states have unique tax requirements. In New Jersey, LLCs may be subject to state income tax, sales tax, and payroll tax. New York LLCs must also adhere to specific tax obligations based on location and industry. Consulting a tax professional is essential to ensure compliance and take advantage of any available deductions.

Final Thoughts

Forming an LLC in New Jersey or New York is a significant step toward securing liability protection and building a professional business structure. While both states have relatively straightforward processes, understanding their unique requirements can save you time and money.

If you’re unsure which state is right for your business or need assistance with the formation process, consulting a small business attorney can provide clarity and ensure compliance. Take the next step toward protecting your personal assets and growing your business—reach out to a professional today!

Mitchell C. Beinhaker, Esq. is a business lawyer and estates attorney who runs a solo legal & consulting practice representing business owners, entrepreneurs, executives, and professionals. Through his 30+ years of experience, Mitchell has handled business development, marketing, firm management, along with business transactional work for clients of the firm. He has extensive experience with corporate governance, commercial transactions, real estate, and risk analysis. Using his years of practical experience, he drafts contracts, negotiates purchases, and can manage outside counsel for any corporate situation. For business owners and executives, he creates and implements estate plans, along with succession plans to help companies continue for future generations. 

Mitchell is the co-author of 10 Ways to Get Sued by Anyone & Everyone:  the small business owners guide to staying out of court, available in paperback and kindle from Amazon.

If you need legal help with any of our services, contact our office for a free consultation.  You can email us at info@beinhakerlaw.com.  To learn more about Mitchell and his practice, visit beinhakerlaw.com.

Beinhaker Law and Mitchell C. Beinhaker, Esq. do not guarantee the accuracy of any information provided in this article.  Its not to be construed as advice of any kind.  Be sure to check with your local professionals before making any decisions.