Whether you’re just starting your own business or you’re a longtime veteran, there are a number of expenses you’ll need to consider. These costs are related to your business type, whether you’re a sole proprietor or an LLC, and your location in New York. You’ll also need to figure in any licensing or other fees that will be applicable.
Sole proprietorship
Creating a sole proprietorship in New York is relatively easy. It is the most common business structure for small businesses, and a common name is typically chosen. However, there are some disadvantages to a sole proprietorship.
Typically, sole proprietorships are owned by one individual, and their income is taxed at the individual’s rate. The sole proprietor is also personally liable for any debts in the business. Because of this, potential clients may be hesitant to do business with an individual.
Sole proprietorships do not provide the personal asset protection that is found in a limited liability corporation (LLC). The owner is also personally liable for any business debts, and is unable to obtain financing through banks or investors.
Generally, sole proprietorships are not considered to be a “legal” business structure, and investors may not be interested in investing in sole proprietorships. This type of business is also not easy to take to the next level.
LLC
Whether you are planning on opening a new business in New York or want to change your current state of incorporation, it is important to understand the costs associated with forming an LLC. There are several different costs to keep in mind, and each will vary depending on how your business is structured.
While a New York LLC is fairly inexpensive, there are several steps you will have to take. The first step is to file an LLC Certificate of Formation. This will provide your business with an Employer Identification Number (EIN), which will allow you to file taxes. It will also allow you to create a bank account for your business.
You may also want to consider registering your business with the New York Business Express System, which is required to collect sales and use tax. This is also a one-time fee.
General partnership
Whether you are planning to start a business in New York or already have one, there are several important things to know about general partnership costs. While forming a partnership is not the best choice for everyone, it can be a great option for certain people. The right partner can make the difference between a successful business and one that fails.
Unlike LLCs, general partnerships don’t require any formal legal documents. Rather, they are formed through an agreement between two people, who agree to be partners. The two partners share managerial duties and responsibilities. They also share in the profits and losses of the business.
While a general partnership is very similar to a sole proprietorship, it is also very different. The general partner owns the business in a proportional fashion. They also take on an unlimited liability, and they have to deal with creditors.
Obtaining a business license
Obtaining a business license in New York isn’t something to be taken lightly. A good lawyer can help you navigate the complex licensing requirements.
The first step to obtaining a business license is determining the type of business you plan to operate. The requirements for each type of business vary. Some types of businesses require more than one license. A business licensed in New York may also be required to comply with local zoning requirements.
The New York State License Center provides comprehensive information on various state licenses. They also have a business wizard to help you determine what licenses are required for your particular business.
There are many other resources available for obtaining a business license in New York. You can also contact the Town and County Clerk’s office for more information. The SBA also offers small business resources.
Getting funding
Getting funding to start a business in New York can be a challenge. However, there are a number of programs available to entrepreneurs. Many government and private businesses offer grants for small businesses that are in need of capital.
One such program is the Innovation Venture Capital Fund. This fund invests in early-stage businesses in New York State. The funds are used to support job creation and drive economic growth.
The City of New York is also offering the COVID-19 Pandemic Small Business Recovery Grant Program. This program is available to small businesses that have suffered losses from the flu. The program has a cap on the amount of grants available and a requirement for businesses to make a minimum of $1 net profit on their return in 2019.
The New York Small Business Development Center is a statewide organization that offers various services for entrepreneurs. This includes free consulting, a connection to funding sources, and training programs.
