Currently, one of the most popular types of businesses to form in New Jersey is the LLC. There are many different reasons why starting an LLC in New Jersey is beneficial.

First and foremost, as the name implies, it provides you with some limited liability protection. It protects you in the event that there are legal or financial issues that may arise. 

Furthermore, most LLC’s throughout the country also benefit from relaxed taxation statuses. Today, we’re here to provide you with all of the information that you need on how to start it.

There are a few different steps you have to follow when forming it, although they are quite simple. It may take time to learn the details, but it is not difficult.

1. Choose the Name for Your LLC

The first step in this process is to choose a name for your LLC. First, you have to choose a unique name that is not in use by any other business in New York. Generally speaking, you also don’t want the name to be in use by any other company in the whole country.

Therefore, you need to search the business name database of New Jersey to ensure that your name is not taken. If your business name is already in use, you’ll want to choose a different one. In that case you can use the help of our business name generator. It is free and will provide you unlimited number of name ideas for your industry. Furthermore, the other important things are the domain names and URL’s. In today’s environment, chances are almost 100% that you need some kind of website to market business.

However, on that note, you want your domain name to be the exact same as your actual business name. Therefore, you want to do a domain name check to see if your domain name is available or not. This is something that you certainly want to factor into the equation.

There are also a variety of naming requirements that you need to follow when choosing a name. For instance, the name cannot be misleading in any way. This is in terms of making people think that you are a government entity. Words like FBI, CIA, state department, and others are strictly prohibited. There are also other words or phrases that you may not include, at least not without additional licensing. For example, a words such as treasury, lawyer, or attorney.

The other requirement to follow here is that the name of your company has to in some way include LLC. This could be “limited liability company,” “LLC,” or “L.L.C.”

2. Choose a Registered Agent

The law states that all limited liability companies in the state of New Jersey have to possess a registered agent. In the state of New Jersey, the registered agent can be either a company or an individual. 

For those of you who don’t know, a registered agent is a person that is responsible for:

  • signing and accepting legal documents
  • tax documents
  • service of process
  • court summonses
  • other such documents on behalf of the LLC.

You may choose to appoint an individual at the registered agent. The agent may be a member of the LLC or yourself. 

However, there are certain requirements that the registered agent must meet. The agent must also be a resident of New Jersey with an address that they can prove. Also they must be over 18 years old, and it has to be someone reliable. 

Furthermore, if you don’t want an individual appointed active registered agent, you can hire a related company. Keep in mind that they need to be registered as companies that provide registered services.

3. Get an EIN

The next step in the process of starting an LLC in New Jersey is to obtain your EIN or employer identification number. The IRS or Internal Revenue Service provides all companies in the United states with a nine digit number that is unique, known as the employer identification number.

You can think of this as your Social Security Number for your business. Follow this link and file the appropriate form with the Internal Revenue agency to receive your employer identification number.

You receive your number immediately once you have filed, and there is no fee either. Now, keep in mind that you cannot legally operate a business in the United States without an employer identification number. The reason for this is because you require an employer identification number to pay your federal and state taxes, which are legal obligations.

You cannot run a business without paying taxes. Furthermore, you also require an employer identification number for many other things, such as for hiring employees, opening a business bank account, and even forgetting a line of credit for your limited liability company.

4. The Public Records Filing

Before your limited liability company in the state of New Jersey becomes legal, you have to complete and submit two specific documents. First, you have to file a certificate of authorization and formation, which can be done online, along with a $125 fee.

There are certain pieces of information that you will need to include within this form, such as the name of the business, address, the registered agent, and more. You’ll see everything you need to fill out when you follow this link which will lead you straight to the form.

You’ll then also have to fill out another form, the tax and employer registration form, which can be done online or by mail. There is also some information you’ll need to include here, including the name of the limited liability company, the purpose of the company, and the address and name of the registered agent.

5. Create a Business Operating Agreement

In the state of New Jersey, limited liability companies are not necessarily obligated to file an operating agreement, but it is a good idea. The simple reality is that an operating agreement provides you with some amount of protection, as well as direction in the amount that something happens.

For instance, an operating agreement provides you with various solutions and methods of what to do when people want to leave the company, when you’re bringing on new people, when there are financial or legal issues, and so on and so forth. This is not a legal document that you have to file with the state, but each member of the limited liability company should sign it and keep a copy.

There are some important pieces of information that you may want to include in any good business operating agreement, including the following:

  • The name and primary address of the LLC.
  • How long you plan at the LLC to exist for.
  • Any important information regarding the appointed registered agent for the LLC.
  • Any vital information in regards to the articles of organization of the LLC.
  • The purpose of the business and the mission statement.
  • All members and their level of investment.
  • How profits and losses are to be handled.
  • The process of admitting new members.
  • The process of offboarding outgoing members.
  • The management structure of the LLC.
  • Indemnification and liability clauses.

6. Additional Steps

The state of New Jersey requires many different businesses in various industries to obtain licenses before they are allowed to do business. 

The most common one is a regular New Jersey business license. There are also other licenses, permits, and requirements that you may have to meet or obtain in order to perform business in the state of New Jersey, particularly depending on where in New Jersey you are and what kind of business you run.

You also need to be aware that all limited liability companies in the state of New Jersey have to file reports every single year which certify that all information on record is correct and current. 

This annual report has to be submitted by the last day of the month when the limited liability company was originally formed. Here is a link that leads straight to this report.

Forming an LLC in New Jersey – Conclusion

The final thing that you might be interested in knowing here is that it will cost you $125 to file your certificate of formation, and those annual reports will cost you $50 each time as well. However, the simple reality is that New Jersey is a great environment for new businesses to start, especially for ones such as limited liability companies.

There are some big liability and tax benefits that people who start limited liability companies in New Jersey are afforded, and these are ones that you should definitely take advantage of.

The only other thing that you need to figure out is whether you want to be a manager-managed LLC or a member-managed LLC. 

If you don’t know what these are, we recommend doing some additional research into the matter. Now that you know exactly how to start an LLC in the state of New Jersey, you can finally create your own profitable company.