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Incorporating in New York? Be Aware of the LLC Publication Requirement
Published on Dec 15, 2011
Read 'Incorporating in New York? Be Aware of the LLC Publication Requirement' at 'Time to Start Up,' the small business blog by BizFilings.
New York is famous for many things. But if you’re about to form an LLC anywhere in the state, there’s a contingency you might not be aware of: New York's LLC publication requirement.What is the New York LLC Publication Requirement?
In addition to incorporating your business and remaining compliant throughout the year, New York requires something more. You must publish a notice within 120 days of your formation detailing the LLC’s name, formation date, office & county location, Registered Agent, business description and announcement of formation.How this information gets published is very specific:
It must be published in two separate publications, for no less than six weeks, at a typical cost of $300 to $2,000
During this six-week span the notice must appear weekly in one of the publications, and daily in the other
In order to determine which publications to use, an LLC must contact the county clerk for the county their company lists on their formation or qualification documents. The county clerk will instruct the LLC as to which two newspapers they must use for their publication requirement
After the six weeks have ended, the LLC must follow up with each publication to obtain an affidavit confirming that the notice ran in each for the designated time
Next, the LLC needs to send the state the affidavits, as well as a state form and a $50 check
Once this is accomplished, the LLC needs to follow up with the state to attain proof of publication
Quite an arduous process, no?For many small business owners, investors and lawyers, this has been a frustrating, head-scratcher of a requirement — especially since the information contained in the notice is easily available on the New York Department of State’s website. With no apparent benefit to the LLC, there is a consensus that this rule is no more than a financial burden to many start up companies with limited financial resources. It also has the potential to drive away potential LLC formations in the state.What if the LLC Does Not Comply with this Contingency?
The answer to this question depends on who you ask. Some feel the requirement is meaningless, while others fear that non-compliance could potentially cause problems. Here’s a list of some of the major potential drawbacks:
The LLC can lose its authority to do business in NY State, making it so the LLC can not instigate litigation (sue) anyone in a New York court
The LLC may lose its Limited Liability Protection, one of the biggest advantages of forming their business in the first place
Who Can Satisfy the LLC Publication Requirement?
As mentioned earlier, an LLC can fulfill this requirement themselves by contacting the appropriate county clerk for information on who to submit their notice to, and then completing each step in the process until proof of publication has been received by the state.
What if an LLC Doesn’t Have the Time to Do This?
There are many professional agencies that perform this service. One thing to look out for is sites that aren’t accredited by companies like VeriSign and the Better Business Bureau (BBB). If the site looks like it was designed in the dark ages, that’s another good sign that you might want to look elsewhere for help.A Big Red Flag …
… should be waving wildly anytime you find a website that guarantees the lowest price. Often, these companies do not adhere to your local county clerk’s mandated publication sources, making your six weeks of notices worthless — and a complete waste of money.If you have further questions about New York’s LLC publication requirement, or would like BizFilings to take care of satisfying the requirement for you, feel free to contact us at: (800) 981-7183; Monday — Friday, between 8:00 AM — 7:00 PM CST; or go to our contact us page for e-mail and instant chat options.blog