New Jersey LLC (7-Step Guide) – How to Form an LLC in New Jersey?

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Step 1: Choose a Name for Your New Jersey LLC

On this tool, you can use the name you have chosen and variations on it to compare against existing business names and ensure that it is easily distinguishable. It is important to keep this in mind because your LLC’s name must be easily distinguishable from any other already in use within New Jersey; otherwise, it cannot be used.

You can also use New Jersey’s Name Availability tool available on the same web page, which offers yes or no answers as to whether a name is available. However, to be certain a name is easily distinguishable enough, it is still a good idea to compare it to similar existing names.

Naming Restrictions

There are a few additional rules when naming your LLC, including both required words or abbreviations as well as those your business is not allowed to use. Let’s take a look at these, starting with what your business is required to include.

Your LLC is required to end with one of the following designations:

• Limited Liability Company
• Limited Liability Co.
• Limited Company
• Limited Co.
• Limited
• L.L.C.
• LLC
• LC
• LTD.
• Ltd.

Your LLC is not allowed to use any of the following designations due to the risk of confusing your business with another form of business structure or other legal entity. The words and phrases your business is not allowed to use include:

• Non-Profit Corporation
• Professional Association or Professional Corporation
• Incorporated
• Corporation
• Corp.
• P.A. or P.C.
• Inc.
• LLP
• LP

Step 2: Select Your New Jersey LLC’s Registered Agent

Your registered agent must have a physical address located within the state of New Jersey that will be listed on public record. This will allow your LLC to be easily located if and when your business is served Service of Process if it is ever sued. The address of your registered agent cannot be a PO Box.

Who Can I Choose as a Registered Agent?

There are a number of options when choosing your LLC’s registered agent. It could be yourself or any other member of your LLC. It could even be friends or family with a physical address located in New Jersey. However, the most popular option and generally best for most business owners is choosing a commercial registered agent.

Regardless of who you choose to serve as your registered agent, they will need to be available at all times during regular business hours. This can be a significant limitation for businesses that operate at odd hours or involve being away from the office for a significant amount of time. If your business has only one employee, this could become an issue if they are ever unavailable due to sickness or even a lunch break.

Additionally, if your business is a foreign LLC or spends most of its time out of state, it is important to choose a trustworthy registered agent to handle your important documents. This can make a commercial registered agent a good option as well due to their ability to receive documents and scan them to be viewed at any time when you are away.
See our top-rated Registered Agent Services.

This can also be useful for those who operate their business from home to avoid their address being on public record. You may also find it can avoid an embarrassing situation in front of family, coworkers, and even customers if your LLC ever receives Service of Process.

Step 3: File Your NJ LLC Certificate of Formation (aka Articles of Organization)

Although you can create your own Form, there are some things you should include in the Form, such as:

It is possible to file your Certificate of Formation by mail or online. However, the online option is far faster and will allow you to get your business up and running quickly. If you choose to file online, your formation will often be approved in 30 minutes or less, and the registration with the New Jersey Division of Revenue will often be approved within two business days.

Within 60 days of approval, you will need to file the tax registration form, Form NJ-REG. This Form can be filed online at the NJ Treasury, Division of Revenue and Enterprise Service’s website.

Step 4: Draft an Operating Agreement for Your New Jersey LLC

A manager-managed LLC is managed by a manager chosen by the members. This manager could be one of the members or someone from outside of the LLC. Once the manager is chosen, the manager will run the LLC and make all of the decisions for the LLC. The members will be limited to an advisory role. However, if the members want to reserve the right to make certain decisions, they can specify this in the operating agreement.

Step 5: Get An Employer Identification Number (EIN)

Not all LLCs are required to obtain an EIN. A single-member LLC does not need one unless the owner is hiring employees. However, LLCs with two or more members do need an LLC, as do any businesses that are hiring employees. Businesses also generally need an EIN to obtain certain business licenses and to open a business bank account.

Step 6: Obtain the Necessary Business Permits For Your New Jersey LLC

To obtain this permit, you need to fill out Form ST-3 for goods you will be selling in-state. If you plan to sell the goods out of state, you need to fill out Form ST-3NR.

If your LLC is planning on selling retail goods, you will be required to obtain a New Jersey Sales Tax Certificate of Authority. You can obtain this certificate after your LLC is registered. Then, you will need to collect sales taxes for any sales and send the taxes to the New Jersey Division of Taxation. You will be required to collect these taxes whether the sales were made at a physical or online store.

Step 7: Start a NJ Business Bank Account

Having a business bank account will also give your business a more professional appearance. Your business will look more professional to your customers when they are asked to write out their checks to your business rather than a member of your LLC. The same is true when paying suppliers; having a check written out from your business bank account appears more professional and will likely help your business to seem more legitimate.

Maintaining Your New Jersey LLC

After you form your LLC, you need to make sure you take the necessary steps to keep your LLC in compliance with state laws. So, we will discuss some of the things you need to do.

It is important to file your annual report by the deadline. If it is late, you may have to pay late fees or lose your Certificate of Good Standing. At worst, the state may even dissolve your business. These rules will apply to foreign LLCs as well.

For Federal Income Taxes, your New Jersey LLC is a pass-through entity, and both profits and losses are allocated to each of its members without ever being taxed on an entity level. This means that tax forms are fairly simple and can be determined based on whether your business is a single-member or multi-member LLC.

Multi-member LLC

If you have a multi-member LLC, it will be taxed as a partnership. Therefore, you will need to file a Partnership Tax Return. To do this, you’ll need to file Form 1065 and provide all of the members with a Schedule K-1 to use when filling out their personal taxes. New Jersey LLCs that have two or more members must also pay a partnership tax. The partnership tax is $150, and you pay it when you submit your State Partnership Return. Fill out Form NJ-1065 for your return.

Single-member LLC

If you have a single-member LLC, you will be taxed the same as if you were a sole proprietorship. The IRS treats a sole proprietorship as a disregarded entity, which means the IRS just taxes you as if you had no LLC. So, the profits or losses are recorded on your individual income tax return.

Sales Tax

If you have a retail business, you are required to collect sales taxes on the purchases. Then, you need to file your taxes with the New Jersey Division of Taxation.

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Final Thoughts

After completing the above steps, you’re done! As you can see, forming a New Jersey LLC isn’t that difficult, and it can save you a lot of money and reduce the risk to any of your personal assets in case of a business failure or lawsuit. So, why not get started filing your LLC today and start growing your business without worrying about losing your personal assets.

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