How to Form a Corporation in New York

If you're interested in starting a corporation in New York, you'll need to take some formal steps to create one. Corporations are required to file paperwork with the state, create internal corporate documents, and comply with tax laws. You can also use our online corporation formation service, which will form a corporation for you with everything you need.

1. Choose a Corporate Name

New York has laws around what you can and can't name your corporation. For instance, your corporation's name must end in one of the following words or its abbreviation:

• "Corporation"
• "Incorporated," or
• "Limited."

Your corporation's name must also be recognizably different from the names of other business entities already on file with the New York Department of State (DOS). You can check which names have already been taken at the DOS's Division of Corporations business entity database. (N.Y. Bus. Corp. Law § 301 (2024).)

If you have a name picked out but aren't ready to register your corporation, you can reserve your name with the DOS. You can reserve a name for 60 days by filing an Application for Reservation of Name with the DOS. The application must be filed by mail. As of 2024, the filing fee to reserve your name is $20. You can find more details on the corporation name reservation webpage on the DOS website. (N.Y. Bus. Corp. Law § 303 (2024).)

2. Appoint a Registered Agent

Every New York corporation must have an agent for service of process in the state (called a "registered agent"). In New York, corporations must appoint the New York Secretary of State as its registered agent. The Secretary will accept legal papers on the corporation's behalf if the corporation is sued and forward this correspondence to the corporation. (N.Y. Bus. Corp. Law § 304 (2024).)

A corporation can designate another registered agent in addition to the Secretary of State. You should make sure the agent agrees to accept service of process on your corporation's behalf before you designate them as your corporation's registered agent. The agent must be either an individual resident or a business entity that's registered or authorized to do business in New York. (N.Y. Bus. Corp. Law § 305 (2024).)

3. File Certificate of Incorporation

Your corporation is legally created by filing a Certificate of Incorporation with the DOS. A certificate of incorporation is also called "articles of incorporation" in other states. You can file your Certificate of Incorporation online through the DOS's On-Line Filing System. You can also mail a completed certificate to the DOS.

The certificate must include:

• the corporation's name
• the corporation's purpose
• the county in New York where the corporation's main office will be located
• the stock structure (including the number of shares the corporation is authorized to issue and the share's par value)
• the designation of the Secretary of State as the corporation's registered agent, and
• the address the Secretary should mail any process received.

(N.Y. Bus. Corp. Law § 402 (2024).)

The DOS has developed an optional certificate form that includes a general purpose clause and authorizes the corporation to issue 200 shares of common stock with no par value. If you'd like for your corporation to have more shares or for the shares to have a par value (discussed later), you can rewrite this portion of the form to insert the desired number of shares and par value.

As of 2024, the fee for filing the Certificate of Incorporation is $125.

4. Prepare Corporate Bylaws

Corporate bylaws is an internal corporate document that sets out the basic ground rules for operating your corporation. At the very least, bylaws should cover:

• how the corporation is structured (for example, laying out the number of directors and officer positions)
• how stock is issued
• the process for meetings of directors and shareholders
• how the board and officers are elected and appointed, and
• the rights and obligations of directors, officers, and shareholders.

In New York, your corporation's bylaws must be adopted at the first organization meeting by the corporation's incorporators. You don't need to file this document with the state. (N.Y. Bus. Corp. Law § 601 (2024).)

Having bylaws has many advantages aside from laying out the corporation's internal operating rules. Bylaws can show banks, creditors, the Internal Revenue Service (IRS), and others that your corporation is legitimate. Bylaws can also help demonstrate that your corporation is its own entity separate from its officers, directors, and shareholders—preventing others from piercing the corporate veil and holding individuals in the corporation liable for corporate debts.

Keep your bylaws, meeting minutes, and other important corporate papers in a corporate records book. You can use a three-ring binder or order a special corporate records kit through a corporate kit supplier. Keep this book at your corporation's principal office.

5. Appoint Directors and Hold the First Board Meeting

The incorporator—the person who signed the articles—must appoint the initial corporate directors. These directors will serve on the board until the first annual meeting of shareholders when the shareholders elect new board members to serve for the next term.

Once the incorporation appoints the initial directors, they should craft an "Incorporator's Statement" showing the names and addresses of the initial directors. The incorporator must sign the statement and place a copy in the corporate records book. You don't need to file this document with the state.

The corporation's initial board of directors will need to hold its first meeting. This meeting should be held to:

• appoint corporate officers
• adopt bylaws
• select a corporate bank
• authorize the issuance of shares of stock
• set the corporation's fiscal year, and
• adopt an official stock certificate form and corporate seal.

The incorporator or another director must record the board's actions and decisions in corporate minutes. If you want your corporation to be taxed as an S corporation, the directors should approve the election of S corporation status at the first meeting as well.

6. Issue Corporate Stock

After internal decisions are made and approved and organizational documents are created, you can start issuing stock. Corporations will typically issue stock to a shareholder in return for their capital contributions of cash, property, services, or some combination of the three.

Small corporations usually issue paper stock certificates. Enter each shareholder's name and contact information in the corporation's stock transfer ledger.

New York Doesn't Require a Par Value for Shares

New York corporations can issue stock with or without a par value. The certificate of formation must indicate which option is chosen. Par value is a set amount below which the stock can't be sold—it has nothing to do with the stock's actual value. In other words, a share's par value is the lowest price it can be sold for at any time. Shares without par value can be issued or sold at any price. Most small corporations issue no par value stock. (N.Y. Bus. Corp. Law § 501 (2024).)

Securities Laws and Exemptions

Typically, a share of stock in your corporation is classified as a security under state and federal securities laws that regulate the offer and sale of corporate stock. Securities laws require corporations to follow certain rules when issuing stock, such as registering the sale with the U.S. Securities and Exchange Commission (SEC).

In general, the SEC is in charge of federal securities laws while the New York State Office of the Attorney General oversees the state's securities laws and registration.

Federal private offering exemption: Many small corporations don't have to worry about securities laws because federal law exempts private offerings from being classified as securities. A "private offering" is a non-advertised sale to a limited number of people (generally 35 or fewer). See our corporations FAQ for more details.

New York private offering exemption: New York requires anyone selling securities to the public to register as a broker-dealer with the Investor Protection Bureau of the New York Attorney General. However, it's generally understood that this registration requirement doesn't apply to a small corporation planning the unadvertised private offering and sale of its initial shares that are exempt from federal registration.

If you're unsure whether your corporation should register in New York, consult a qualified securities law attorney. For more information about New York registration requirements, see the Investor Protection Bureau Broker-Dealer and Securities Registration and Information Sheet.

7. File New York Biennial Statement

All corporations doing business in New York must file a Biennial Statement with the DOS every other year. The statement is due during the calendar month when the corporation's original certificate of incorporation was filed. For example, if you incorporated your company on September 9, then you'd file your Biennial Statement in November every two years. (N.Y. Bus. Corp. Law § 408 (2024).)

File your statement online using the DOS's E-Statement Filing System. As of 2024, the fee to file your Biennial Statement in New York is $9.

Check out the DOS's biennial statements webpage for more details.

8. Obtain an EIN and Comply With Tax Requirements

All corporations must get a federal employer identification number (EIN). You can apply for an EIN online through the IRS website. There's no filing fee. Once you apply, the IRS will immediately assign your corporation an EIN.

All New York corporations and foreign corporations doing business in New York must pay state taxes to the New York Department of Taxation and Finance (DTF). You can create an Online Services account with the DTF to register your business and to file and pay taxes.

New York corporation franchise tax: New York state tax law requires a corporation to file franchise tax reports and pay franchise taxes annually even if the corporation doesn't conduct business or loses money. Franchise tax requirements begin on the date the corporate existence begins and continue until the DOS legally dissolves the corporation. Most general business corporations must file Form CT-3, General Business Corporation Franchise Tax Return. For more information, visit the DTF's corporation tax webpage website. You can also read our article about New York's state business income tax for more guidance.

New York sales and use tax: If your corporation sells taxable goods and services to customers in New York, you must collect and pay sales tax to the DTF. Before making taxable sales, you must register your corporation as a sales tax vendor through New York Business Express (NYBE). After registration, the DTF will send you a sales tax certificate of authority. For more, review the sales and use tax section on the DTF website.

Withholding employee wages and paying unemployment insurance (UI) tax in New York: If your corporation has or will have employees, you need to register as an employer through NYBE. You must file your returns online using one of the DTF's approved methods. All employers must file NYS-45, Quarterly Combined Withholding, Wage Reporting, and Unemployment Insurance Return every quarter. Depending on how much you withhold every quarter, you might need to file and pay taxes every payroll period. Check out the withholding tax section on the DTF website. You should also review the Employer's Guide to Unemployment Insurance, Wage Reporting, and Withholding Tax.