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New Jersey LLC For Beginners: No Attorney Required

New Jersey LLC For Beginners: No Attorney Required

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New Jersey LLC For Beginners: No Attorney Required

Starting your first business can be a bit scary, but with proper direction, it can be a lot less intimidating. One important step to getting a business off the ground is selecting a business structure.

One popular option is the LLC, and our guide is designed to simplify the process of starting your New Jersey LLC, providing step-by-step instructions and some tips to make sure your business is set up correctly.

Related: How to start a business in New Jersey

Why choose an LLC?

The Limited Liability Company (LLC) is a popular entity structure for businesses starting in the state of New Jersey because of the LLC’s blend of personal asset protection, operational flexibility, and tax benefits.

Unlike a sole proprietorship or partnership, where the small business owner can be held personally liable for lawsuits against the business, the LLC is a separate legal entity that protects the business owner’s personal assets. So, if the LLC is sued, the owner’s personal assets are usually protected.

In addition to liability protection, the Limited Liability Company provides several other benefits over the sole proprietorship, partnership, and corporation because of the multiple tax options, ease of administration, and management flexibility.

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Steps To Start A New Jersey LLC?

Step 1: Choose a Name for the LLC

One of the first steps in forming a Limited Liability Company (LLC) is to choose a name for your business. But before you can register your LLC with the state of New Jersey, you need to make sure that your chosen name is available. This is because the name of each LLC must be distinguishable from other entity names registered in the state of New Jersey. The New Jersey Division of Revenue & Enterprise Services makes it easy to do a New Jersey LLC name search, so you can quickly verify if your LLC name is available. 

In addition to the name being unique, the entity designator (identifier used at the end of the business name) must be either:

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

A comma may be used after the business name and before the designator.  “Jersey Shore Java LLC” and “Jersey Shore Java, LLC” are both acceptable.
 
There are a few other naming guidelines, such as not including words in the name that refer to a federal or state agency or words related to banking, trust, insurance, Olympic, Little League, or realtor, unless the LLC is approved to do so.

If there is a name you want, but you aren’t quite ready to register the LLC, you can file an Application for Name Reservation and hold a name for up to 120 days.

Before settling on a name, you may also want to see if a domain name is available to match your business name and website address.

Step 2: Appoint a New Jersey Registered Agent

In New Jersey, every LLC will need to designate a registered agent. A registered agent is simply an individual or company with a New Jersey street address who will be responsible for any legal correspondence. This includes the receipt of legal documents, such as lawsuit notifications, on behalf of the business.

While many LLC owners opt to fulfill this role themselves, some owners choose to hire registered agent services like Northwest Registered Agent. Utilizing a registered agent service ensures that your LLC adheres to state requirements while offering an added layer of convenience and confidentiality since the owner’s personal address isn’t disclosed in public records.

Related: What is a New Jersey registered agent?

Step 3: File the New Jersey Certificate of Formation

To form a Limited Liability Company in New Jersey, file the LLC Certificate of Formation with the New Jersey Division of Revenue & Enterprise Services.  

Related: How to fill out the New Jersey LLC Certificate of Formation

After the New Jersey Division of Revenue & Enterprise Services approves the LLC paperwork, a Certificate of Formation will be issued.

When filling out the LLC paperwork, there are a few sections that catch some people by surprise. I’ll go over a few of these sections to help get your LLC started right.

Employer Identification Number: This is optional, but you can enter the EIN of the LLC here.  If you don’t have an EIN, a link is available to the IRS to file one.  See our guide on filing an LLC EIN.

NAICS code: This section is optional and asks for information regarding the business’s activities.  To do that, there is a number called NAICS (North American Industrial Classification System).  This code is a six-digit number that classifies and categorizes the different businesses.  This information is used in reporting statistical data for each of the industries in the U.S.  You will want to remember this number, as it will be needed when filing annual tax returns.  Learn how to search for a NAICS number.

Duration: If you intend the business to exist forever, which most businesses do, enter “Perpetual” or leave it blank, as all LLCs are set up with a perpetual duration by default.  If you have a specific end date in mind (typically used for investment-related businesses), choose a dissolution date.

Effective date: If you want the LLC to start immediately, leave today’s date in the box.  Otherwise, choose a date in the future that you want the LLC to start. The main reason for delaying the LLC start date is when the filer is close to the end of a calendar year, and the business isn’t going to have any activity.  By delaying until the following year, they will reduce the number of end-of-year filings.

Business purpose: Provide some basic information about what the business does.  If you want to keep the business purpose more open-ended, you can just have “Any lawful business activity for which a Limited Liability Company may be organized in New Jersey.”

Related: How to answer the business purpose statement

Main business address: In this section, enter the street address, city, state, and zip code of the initial principal office to receive mail from the state.  This address can be the LLC’s physical address, or it can be the address where the business records are stored.  The address does not have to be located in New Jersey, but you may not use a PO Box.

Members / Managers – Enter the names of up to 10 Members and Managers.

  • Member-Managed LLCs have an active involvement in the management of the LLC.
  • Manager-Managed LLCs are hired by the members to run the LLC, similar to a CEO of a corporation.

At least the name and address of one LLC member or manager must be entered.

If you are worried about making a mistake when forming your LLC, or just don't want to deal with filling out state paperwork, an LLC formation service will help guide you through the process. My top recommended services include:

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What To Do After Starting A New Jersey LLC

Once the LLC has been formed, there are a few additional steps to take care of. Below is a list of the most common tasks.

Prepare a New Jersey LLC Operating Agreement

The operating agreement is a document that governs the framework of an LLC.  This document covers items like ownership rights, member responsibilities, how profits and losses are distributed, and more.

Most states (including New Jersey) do not require an LLC to have an operating agreement, but it is still worth considering. Without an operating agreement:

  • The LLC could be subject to generic state rules that may be detrimental in the event of a lawsuit.
  • Member’s personal liability protection may be diminished.
  • Members may not fully understand their roles and responsibilities, which could lead to costly disputes in the future.

Related: New Jersey operating agreement template

Obtain an EIN

If the LLC will hire employees or is owned by more than one member, an EIN is required. 

The EIN or Employer Identification Number (also referred to as a Federal Employer Identification Number, FEIN, or Federal Tax ID Number) is a unique 9-digit tax identification number assigned to a business by the Internal Revenue Service (IRS). Similar to a social security number for an individual, the EIN identifies business entities for tax purposes.

Related: How to register for an EIN

Open an LLC Bank Account

Opening a bank account for your LLC is important for liability protection as the account separates the business’s funds from the member’s personal funds.

Several documents will be needed to open a business bank account, such as:

  • A banking resolution is a document that authorizes the members to open a business bank account on behalf of the LLC.
  • Copies of the original business formation paperwork from the state showing the creation of the LLC.
  • Driver’s licenses of the members.
  • Occasionally, the bank will request a Good Standing Certificate to prove the LLC is active and in good standing with the state.

Related: How to open a business bank account for your LLC

Apply for Business Licenses and Permits

Depending on what your business does and where it is located, there will likely be various business licenses and permits needed before starting your business. Some common registrations include:

  • Business registration application: Every LLC is required to file the Business Registration Application (also referred to as the New Jersey LLC Registration for Taxes or Business Registration Certificate) Form NJ-REG with the New Jersey Division of Revenue and Enterprise Services within 60 days of formation. This application combines several business registrations, such as the sales tax certificate and employee withholding, with the Division of Taxation.
  • Local business license: In addition to the business registration application, some cities also require businesses to obtain licensing.
  • Professional license: In New Jersey, certain services, such as barbershops, accountants, salons, and others, must be licensed.

Related: What business licenses are needed in New Jersey?

File the New Jersey LLC Annual Report

LLCs are required to file an annual report with the New Jersey Department of Treasury.  The annual report fee is $75 each year and is due on the last day of the LLC’s anniversary month. For example, if the LLC were formed on November 1st, 2024, the annual report would be due on November 31st, 2025.

Related: How to file a New Jersey LLC Annual Report

File the Beneficial Owner Information Report

Beginning in 2024, any individual who owns at least 25% or has “substantial control” of an LLC or corporation in New Jersey or any other state must file the Beneficial Ownership Information (BOI) form with the Financial Crimes Enforcement Network (FinCEN). BOI reports are filed electronically through FinCEN’s website.

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New Jersey LLC FAQs

How much does it cost to start an LLC in New Jersey?

To start an LLC in New Jersey, a filing fee of $125 will be paid to the New Jersey State Division of Revenue & Enterprise Services.

How long does it take to start an LLC in New Jersey?

It typically takes under an hour for a new LLC to be approved in New Jersey when filing online versus 2-3 weeks when filing by mail.

What is the total expected cost of operating an LLC in New Jersey?

Each year, an annual report must be filed along with a $75 annual fee.

What is a Foreign Limited Liability Company?

A New Jersey foreign LLC isn’t a special type of LLC. Instead, it’s an LLC that was formed in another state but wants to physically operate in New Jersey. Physically operating means having a presence, such as having an office or hiring an employee.

Related: What is the difference between a domestic New Jersey LLC and a foreign LLC?

New Jersey LLC For Beginners: No Attorney Required

New Jersey LLC For Beginners: No Attorney Required

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