New Jersey has become a well-ranked state over years, bringing in over $600 billion for the U.S. economy. The state has become a popular paradise for pharmaceutical and biotechnical industries and has seen a significant rise in tourism over time, with Atlantic City claiming it as the Las Vegas of the East Coast. Overall, New Jersey has become a generous and well-worth state to reside, as both government and private sectors see an overall increase for employment opportunities.
Starting any business can seem tricky to entrepreneurs, but the formation process for starting and setting up a Limited Liability Company (LLC) in the state has improved over time. The state offers some progressive tax laws and is actively improving its overall financial backing for these businesses. We review some of the ample reasons one should set up an LLC in New Jersey.
A brief overview of a Limited Liability Company
The legalities constituted in forming an LLC have seen a significant rise in smaller and medium-sized businesses in the last decade. An LLC is a legal and binding business structure that allows for more flexibility, ease of setup, better startup resources, and overall affordability.
There is also the well-known legal separation of business and personal assets, ensuring personal liability protection in the event of financial disputes. LLCs offer attractive tax benefits across the board, and in recent times, many states have adjusted and changed their state tax regulations to be more suitable for smaller LLC companies. Besides, many owners(s) have found that it's easier to start an LLC with either a family member or a friend, as it allows for more than one or two owners to operate and share profits.
The flexibility offered by this structure is prevalent for startups and young entrepreneurs, securing their income and assets from the business.
Starting an LLC in New Jersey
What are some basic business requirements for starting an LLC in New Jersey?
Although the state does allow for venture capital to flourish and depending on your business plan you might be entitled to some limitations or basic state requirements. It's not without knowing that paying both state and federal taxes are a priority, so when you start employing new personnel ensure to register for an Employer Identification Number (EIN) with the IRS. It's also more likely that the state will require annual filing, tax payment filing, and unemployment insurance tax registration before opening your business.
How to start an LLC in New Jersey?
A New Jersey LLC is easier than you think, and if you want to read our extensive step-by-step guide you can do so online.
Step 1 - Find a suitable name for your LLC, by ensuring it's authentic, complies with the states' naming guidelines, and is distinguishable from those entities already registered with the New Jersey state.
Step 2 - A registered agent will act as the body representing your business for legal, financial, state, and federal filing procedures. New Jersey allows owner(s) to act as registered agents for their LLCs, but it will require you to publicize your address and report legal actions by yourself. You can use registered agent services that are widely available in the state.
Step 3 - Filing a formation certificate with the Division of Revenue & Enterprise Services officially forms your LLC. It's possible to do this by yourself or with the help of formation services providers.
Step 4 - Filing for tax is only possible with an EIN, and the state requires you to register with the New Jersey Division of Revenue and Enterprise Services for business entity and tax filings within 60 days of formation.
Step 5 - Create an operating agreement that outlines admitted members, responsibilities, termination agreements, and distribution of profits.
Step 6 - Obtain an EIN online from IRS to employ staff, register a business bank account, and file state and federal taxes.