LLC formation in NYS
Most Popular Reply
Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
16yHi, I'm assisting two investors in forming LLCs, from a financial planning and organization standpoint. Where I am it's $50.00 for filing fees and an attorney will probably charge 500 to a grand. One of my "students" told be it was about $2,500 with an attorney. I'd certainly like to meet that one!
What I have done is when I want legal work accomplished is I ask what their hourly rate is. I don't tell them in the interview what I want them to do other than real estate contract review, developing documents and filing issues related to the business. They give me an hourly rate. I might sign as a client at that time if they want. Then I show up with my documents and say here, do this and only this. Granted, if you have no experience, you can get snowed easily. Now, I have had a few say, oh, this is the formation of a trust, this is different and I say, you agreed to work for me at XX per hour. I see their point, but an attorney on a retainer is an attorney I own! I did accuse one of bait and switch and she backed off. We didn't have a very good relationship after that and I dumped her, but had the work done. What alot of people don't understand is that the attorney works for you and is obligated to follow your directions so long as you are acting in good faith and not trying to pull a fast one, doing something illegal and they have an obligation to provide good council, it's up to me to take it or leave it. Many market their services as if they are "in charge" when I see that personality, they are not for me. If they can't follow instructions, they don't get the work. There are many starving out there. I talked to an attorney in Texas the other day and he was telling me something like 3000 went out of business or lost their jobs last year! Don't let these people snow you, forming an LLC will take about an hour if you have your ducks in a row, two hours tops for a boilerplate form plus filing fees. You can also do it yourself. the Secretary of State will probably have the forms. The last one I did was done on line with the secretary of state and cost $50.00! Seems there are shysters in every profession, too bad! Bill
18 Replies
- Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes16y
Hi, I'm assisting two investors in forming LLCs, from a financial planning and organization standpoint. Where I am it's $50.00 for filing fees and an attorney will probably charge 500 to a grand. One of my "students" told be it was about $2,500 with an attorney. I'd certainly like to meet that one!
What I have done is when I want legal work accomplished is I ask what their hourly rate is. I don't tell them in the interview what I want them to do other than real estate contract review, developing documents and filing issues related to the business. They give me an hourly rate. I might sign as a client at that time if they want. Then I show up with my documents and say here, do this and only this. Granted, if you have no experience, you can get snowed easily. Now, I have had a few say, oh, this is the formation of a trust, this is different and I say, you agreed to work for me at XX per hour. I see their point, but an attorney on a retainer is an attorney I own! I did accuse one of bait and switch and she backed off. We didn't have a very good relationship after that and I dumped her, but had the work done. What alot of people don't understand is that the attorney works for you and is obligated to follow your directions so long as you are acting in good faith and not trying to pull a fast one, doing something illegal and they have an obligation to provide good council, it's up to me to take it or leave it. Many market their services as if they are "in charge" when I see that personality, they are not for me. If they can't follow instructions, they don't get the work. There are many starving out there. I talked to an attorney in Texas the other day and he was telling me something like 3000 went out of business or lost their jobs last year! Don't let these people snow you, forming an LLC will take about an hour if you have your ducks in a row, two hours tops for a boilerplate form plus filing fees. You can also do it yourself. the Secretary of State will probably have the forms. The last one I did was done on line with the secretary of state and cost $50.00! Seems there are shysters in every profession, too bad! Bill New York has a ridiculous LLC publication requirement that is a giveaway to the newspaper industry. To form an LLC, not only do you have to register with the Secretary of the State, but you also have to pay to publish in two different newspapers once a week for six consecutive weeks. In Staten Island it should be much cheaper than $3000 because of the cost of publishing there is cheaper. $3000 seems right for Manhattan and the Bronx if you are using an attorney.
right i heard about the publication requirement. you sure its two newspapers? I would put it in the staten island advance, don't know about the other.
Also, I hear about a lot of people forming LLCs in Nevada or Delaware because of their limited taxation and business friendly laws and courts. Would this work for me and how would I go about forming in another state (even if I decide to do all my business in New York)?
I am pretty sure it's two (one weekly newspaper and one daily). The Staten Island Advance might be one but you don't get to chose (the county clerks office will tell you which ones to use).
Forming an LLC out of state will not save you money; It will cost you more!. If you form an LLC in Delaware or Nevada, you still have to register the LLC in New York as a foreign LLC. In effect, you will have to pay the filing fees to register in Delaware or Nevada and New York.
From a taxation standpoint, you are taxed on where you conduct business (New York) and where you live (New York?). So unless you move and conduct business somewhere else, you will have to pay NYC & NYS income taxes of any profits from NYC income.
Delaware and Nevada do have more favorably business laws than New York but you would have to speak to an attorney to see if it makes sense for your business.
- Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes16y
WOW! Talk about special interest groups! You might ask Clinton why Arkansas didn't require that! Bill
I printed the articles of organization..but it only requires the person whose filing the articles name...what about the other members? Will they send us something else to fill out? It says the county clerk determines what newpapers to publicate in, but how do I find out which newspapers or contact the county clerk (Richmond County)?
Originally posted by Phil Mondiello:
I hear the other publication is the New York Law Journal which can cost $800-$1300 for publication! Thats ridiculous! Is there any validity to this?
Yeah, that sounds about right.
http://publicnotices.law.com/NYLawyer/
There arn't any publication requirements for an S Corp, correct? I mean, for real estate investment purposes, what is the most efficient and cost effective? From what I understand an LLC and an S Corp have the same amount of limited liability and same pass-through taxation. Are there any disadvantages to the S Corp? What are the annual fees for both? Is one more expensive than the other?
- 16yMark UpdegraffBusiness MemberReal Estate Broker · Rochester, NY · Member since 2010 · 1k+ posts · 713 votes
Originally posted by Phil Mondiello:
So my partners and I have decided to start the formation of an LLC so that we have a business entity to protect our assets.
I understand that the Articles of Formation are a few hundred dollars, but I've spoken to a few other investors and most of them said it would cost about $3,000 to form an LLC. We would preforably want to formate in Richmond county, although I hear of other investors formating out of state, however I don't know the advantages of that. My question is how much would it cost in total? Is most of that cost attorney fees? Would it be significantly less expensive if I used legalzoom.com?
I just formed my First LLC in the great state of NY completely by myself, without attorney. I can't remember the exact about of the fees. Total I spent less than 500 including proof of publication! Why don't you just register it in a different county with cheaper rates? All the instructions you need are on the NY Dept. of State website.
Updegraff Group Realty4.742 Reviews Originally posted by Phil Mondiello:
There arn't any publication requirements for an S Corp, correct? I mean, for real estate investment purposes, what is the most efficient and cost effective? From what I understand an LLC and an S Corp have the same amount of limited liability and same pass-through taxation. Are there any disadvantages to the S Corp? What are the annual fees for both? Is one more expensive than the other?
I would do you a dis-service if I advised you about which one is better because I simply don't know. It might not be so much about the liability protection but about the taxation. The publication requirements in New York only apply to LLC's.
Originally posted by Mark Claire:
Originally posted by Phil Mondiello:
So my partners and I have decided to start the formation of an LLC so that we have a business entity to protect our assets.
I understand that the Articles of Formation are a few hundred dollars, but I've spoken to a few other investors and most of them said it would cost about $3,000 to form an LLC. We would preforably want to formate in Richmond county, although I hear of other investors formating out of state, however I don't know the advantages of that. My question is how much would it cost in total? Is most of that cost attorney fees? Would it be significantly less expensive if I used legalzoom.com?
I just formed my First LLC in the great state of NY completely by myself, without attorney. I can't remember the exact about of the fees. Total I spent less than 500 including proof of publication! Why don't you just register it in a different county with cheaper rates? All the instructions you need are on the NY Dept. of State website.
Which county did you register it in? The fees I can see for richmond county go as follows:
$200 filing fee for articles of organization
$50 filing fee for certificate of publication
$200+ for staten island advance publication
$720+ for new york law journal publication
$1170 total atleast$500 would be a great price comparably..however are there any annual fees on the LLC?
Originally posted by Phil Mondiello:
Originally posted by Mark Claire:
Originally posted by Phil Mondiello:
So my partners and I have decided to start the formation of an LLC so that we have a business entity to protect our assets.
I understand that the Articles of Formation are a few hundred dollars, but I've spoken to a few other investors and most of them said it would cost about $3,000 to form an LLC. We would preforably want to formate in Richmond county, although I hear of other investors formating out of state, however I don't know the advantages of that. My question is how much would it cost in total? Is most of that cost attorney fees? Would it be significantly less expensive if I used legalzoom.com?
I just formed my First LLC in the great state of NY completely by myself, without attorney. I can't remember the exact about of the fees. Total I spent less than 500 including proof of publication! Why don't you just register it in a different county with cheaper rates? All the instructions you need are on the NY Dept. of State website.
Which county did you register it in? The fees I can see for richmond county go as follows:
$200 filing fee for articles of organization
$50 filing fee for certificate of publication
$200+ for staten island advance publication
$720+ for new york law journal publication
$1170 total atleast
$500 would be a great price comparably..however are there any annual fees on the LLC?
Id also like to know this. I am buying in Jamestown (Chautauqua county) and would be ok with a $500 LLC setup.Thanks
Some other questions include:
Will it be possible for me to form in a different county with less expensive publication requirements?
Could I still do business and have our principal office in Richmond county while filing in a different county (legally)?- San Francisco, CA · Member since 2009 · 171 posts · 24 votes16y
Phil,
This is the point at which cost posits a cost-benefit analysis for enterprise.
It should be noted that only a competent attorney can advise you as to the most beneficial type of business entity.
Furthermore, your need - protecting assets - sounds as though it directs the entity, not the other way around.
Ex. Even if it costs more to form the entity that best protects your assets that serves a greater utility for that need. If ever unfortunately engaged in legal proceedings a paltry savings on these upfront savings will be a distant memory.
Just updating this thread, I received the below from a NY attorney re setting up an LLC in NY state. You can see the cost is a rather hefty $1100-$1200. Ouch. I might just ensure I have adequate liability cover and run my properties through my personal return.
“I would recommend a Limited Liability Company instead of a Corporation. I believe this would give the most flexibility and be most beneficial for tax purposes.
In regard to establishing the Limited Liability Company we would need to know the following information:1. The name that you would choose for the Limited Liability Company. Usually we recommend to people that they choose two or three possible names so that we can do a name search to make sure of the availability of the name. In choosing the names put them in the order of priority that you would prefer to have the name.
2. In regard to expenses involved in setting up a Limited Liability Company if it is a New York Limited Liability Company you can anticipate approximately Four Hundred Fifty Dollars ($450.00) in filing fees for the filing service and the New York State Department of State; approximately Two Hundred Fifty Dollars ($250.00) in publication expenses since the Notice of Formation needs to be published in two (2) local newspapers once a week for six (6) consecutive weeks; approximately Two Hundred Dollars ($200.00) for the filing of the Affidavits of Publication with a New York State Department of State providing proof that the publication has been completed; and approximately Three Hundred Dollars ($300.00) to Three Hundred Fifty Dollars ($350.00) for our attorney’s fees.Also, if you are establishing a New York Limited Liability Company we would have to have a New York address for the principal place of business or location in New York State.â€
Join the conversationCreate a free account to reply, vote on answers and follow this thread.