When deciding to form a business in NYC, Buffalo, Rochester, Albany or elsewhere in New York, you should review and evaluate the most recent state laws and regulations that apply to your specific company and, most importantly, seek the advice of a qualified professional who has experience with New York corporations like yours. You may want to consider information that could help you determine whether forming a corporation or limited liability company (LLC) in New York is right for you.
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Business owners who incorporate in New York experience the peace of mind derived from the limited liability protection a corporation provides. New York corporations can protect your personal assets, since they cannot be used to satisfy debts and liabilities of the corporation. A New York corporation's limited liability protection also shields its shareholders from any claims arising from lawsuits.
A New York corporation's board of directors and officers enjoy the same limited liability protection as do the corporation's shareholders.
Unless you elect to have a special “pass through” tax status with the Internal Revenue Service (IRS) by filing an IRS Form 2553, your New York corporation will enable you to shelter and retain more income since a corporation files tax returns and pays its income taxes (at generally lower tax rates than do individuals) while the individual shareholders report and pay personal income taxes only on monies paid them by the corporation. Although shareholders are required to pay taxes on income from dividends paid by the corporation even though income taxes were previously paid by the corporation (called “double taxation”), a New York C corporation can facilitate the accumulation of earnings.
Forming a corporation in New York should make it easier to get additional capital than it would be with some of the other types of businesses. You can issue and sell stock or a variety of other financial instruments as evidence of interest in the corporation and ownership in New York corporations can be easily transferred through the issuance or transfer of stock.
Employees would normally prefer to work for a corporation rather than a proprietorship or partnership and a New York corporation has the advantage of being able to attract, motivate and retain quality employees by offering stock option and bonus plans.
New York corporation owners working in the business are employees and are therefore eligible for certain fringe benefits such as group insurance plans, retirement and profit sharing plans, and tax-favored stock option and bonus plans. In addition, the corporation allows owners to reduce self-employment taxes.
A New York corporation is a separate legal entity and, in a sense, immortal and perpetual since it does not end with the death of a shareholder owner as do some of the other business types.
If you're a small business owner who has chosen to incorporate in New York, you may struggle in deciding which type of incorporation is best. At MaxFilings, we hope to clearly distinguish the advantages and disadvantages of starting an LLC vs. a corporation, whether to classify your business as an S Corp or C Corp, and give you a better idea of which option will provide the best results for your continued financial and operational success.
|Limits personal liability|
|Ownership structure||Unlimited owners||Unlimited shareholders||No more than 100 shareholders (US citizens or resident aliens only)|
|All business income/loss passed through to owners each year|
|Owners pay personal income tax on profits|
|Business must pay corporate income tax|
|Recognized outside of the US|
|Flexible management structure|
|Annual Meeting Requirement|
A New York corporation name must be distinguishable from the names of other business entities already on file with the New York Department of State and shall contain the word "corporation", "incorporated" or "limited", or an abbreviation thereof. The corporation's name cannot contain words suggesting it is another business entity or that it is organized for a purpose not permitted by state law or that it is a public corporation or government agency.
The board of directors of a New York corporation shall consist of one or more members with the number being fixed by the bylaws or by action of the shareholders or the board under the specific provisions of the bylaws adopted by the shareholders. If not otherwise fixed as may be allowed, the number shall be one. Directors must be at least 18 years of age while additional qualifications may be set forth in the corporation's certificate of incorporation or bylaws.
A New York corporation's board of directors may elect or appoint a president, one or more vice-presidents, a secretary and a treasurer, and such other officers as it may determine, or as may be provided in the by-laws. The certificate of incorporation may provide that all, or specified, officers shall be elected by the corporation's shareholders instead of by the board of directors. The same person may simultaneously hold more than one office and when all of the issued and outstanding shares of the corporation are owned by one person, they may hold all or any combination of offices.
A New York corporation's shareholders' meetings may be held at such place, within or without the state of New York, as may be fixed by or under the bylaws, or if not so fixed, at the corporation's New York office. Shareholders' meetings shall be held annually for the election of directors and the transaction of other business on a date fixed by or under the bylaws.
Special shareholders' meetings may be called by the board of directors and by such person(s) as may be so authorized by the certificate of incorporation or the bylaws.
Regular or special board of directors' meetings may be held at any place within or without the state of New York, unless otherwise provided by the certificate of incorporation or the bylaws, with the time and place for such meetings being fixed by or under the bylaws or, if not so fixed, by the board.
*For complete and current information concerning New York corporations, visit the state's official website. The information listed above is not an attempt to present all you need to know when forming a corporation in New York but rather to call your attention to some basic information and requirements you may want to know as you submit information to form your corporation or LLC.
MaxFilings is committed to helping business owners just like you. Here are a few reasons why MaxFilings stands out as the resource of choice when forming a New York corporation:
Competitive, Transparent Pricing. There's never any obligation to order and there's no charge for saving your information – you only pay your incorporation fees when you're ready to order. View our competitive pricing - it includes all state fees and other charges, so you'll have no surprises later.
Convenience & Ease of Use. MaxFilings helps you get organized in an orderly way and you set the pace – you can save all your incorporation information in one handy spot online and make changes anytime until you're ready to incorporate…or you can order your incorporation online right now!
Secure & Confidential. As a MaxFilings user, you can rest easy knowing that all your information is completely safe. We use industry-recognized security safeguards for storing and processing your orders, ensuring stringent data security for as long as you want to keep it with us.
Partner Perks. As you incorporate, you need to think about growing and promoting your new corporation. MaxFilings' online promotions partner SEO Advantage offers you expert services in PR, web development, search engine marketing, website optimization and graphic design.
Best of all, your satisfaction is 100% guaranteed!
If you're ready to form a New York corporation, you can start entering your information now. You're under no obligation, and there is no charge until you actually place your order.
Wondering what happens after you submit your incorporation order to us? Have questions about using MaxFilings to incorporate your business or form an LLC? Here you'll see basic questions about our system that can help make your experience smooth and hassle-free. FAQ About MaxFilings