Saving Money on the LLC Publication in New York City

I guess there are two ways how you could save on that unfortunate LLC publication requirement in New York, which will easily set you back $700-1000 in New York City.  (If you don’t know what that is, look at “Taking Care of the LLC Publication Requirement“.) 1. You could just not do it; do I recommend that?  No.  It is required by law.  But as far as I know, the only...

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New York LLC Operating Agreements: Management Provisions

An Operating Agreement is a key document for a New York Limited Liability Company that has more than one owner (the owners are "Members" in LLC terminology). If a Company was like a marriage, the Operating Agreement would be like a prenup, parenting agreement and divorce settlement all in one. While the New York limited liability company law provides for some default rules applicable...

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NY S Corporations v. LLCs

Many small business owners end up deciding between a New York S corporation and a New York limited liability company (LLC) when choosing a formal legal structure for their New York business. Both entities offer limited liability and a startup friendly tax treatment. But which entity is right for your small business? The following are some frequently asked questions with respect to the two...

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How to use Special Terms in your LLC’s Name

As you may know, there are naming rules (Section 204 NY limited liability company law) when it comes to choosing a name for your LLC.  Most  names are o.k. if not already taken by somebody else, but some terms are tricky and require special dispensation. For example, try filing articles of organization for this LLC:  "Life Exchange, LLC".  You will get a nice letter...

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In court, an LLC needs an Attorney

Tom Swartz of New York Legal Update alerted me to this recent development in LLC law:  A New York court has decided that a  New York LLC needs to be represented by an attorney in court.  See his post on the topic and for case information.  Pursuant to CPLR 321(a), "a party, other than one specified in section 1201 of this chapter, may prosecute or defend  a ...

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Transferring Assets to your new LLC

Another reader question:  "If you start a new LLC, but have web sites or other IP that you want to be “owned” by the new LLC, what needs to be done to make it property of the new LLC?" The property has to be transferred to the new LLC, some say "contributed" to the LLC.  If the property consists of a website, you may write up a one page document that says...

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Keeping your LLCs separate

Somebody asked me the following question:  "If you start a new LLC, but have old business credit cards from a previous (but now closed) LLC, can you use those credit cards with the new business without causing problems?" It is a little bit like asking, "If my grandfather died and left behind some credit cards in his desk, can I use those cards for my spring break vacation...

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Professionals starting a Corporation or Limited Liability Company in New York

A professional cannot form a regular corporation or limited liability company to sell his or her professional services.  This is well known about lawyers and doctors, but it is also true for nurses, psychologists, and any other profession designated in Title 8 of the education law. These professions have to form a special kind of corporation or LLC, a so called professional corporation or a...

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Can a Limited Liability Company issue Share Certificates?

Yes, but they would typically be called membership certificates or units. In my experience, small businesses rarely issue such membership certificates. Typically, when two or more people form an LLC, they form the entity by filing the necessary paperwork with the Department of State and then enter into an operating agreement between themselves and the entity.  The operating agreement will...

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How to convert an LLC into a Corporation

There are times in the life of a business when one business form has to be converted into another.  For example, a startup may have initially decided to form an LLC in order to pass through the LLC’s losses to the owners’ tax returns, thereby allowing them to deduct such losses from their other non business related income.  Now the startup is seeking venture capital...

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