How To Start a Business in New York: 12 Steps (2025)

Learn the key steps to start and register your small business in New York, from choosing a business structure to filing taxes.

This content doesn’t contain and isn’t meant to provide legal, tax, or business advice.*

New York’s economy is the country’s third-largest, at more than $1.7 trillion, and the state is a hub for a variety of industries. Because small businesses make up the majority of businesses in New York, it’s a great place to start a new business.

“New York is a state with a strong economy with a mix of industries, a strong job market, and entrepreneurial cultures,” says Sandra Eberhard, president and CEO of the Women’s Business Enterprise Council (WBEC) Metro New York and Greater DMV (which includes DC, Maryland, and Virginia).

New York is fertile ground for new ventures, but starting a business there does require careful planning (and some paperwork).

Ready to start your business? Create your website today or learn more about Shopify’s tools for selling online and in person.

Start a business in New York

1. Choose a business idea
2. Choose a name
3. Create a business plan
4. Select a business structure
5. Register your business
6. Get an employer identification number
7. Apply for business licenses and permits
8. Examine insurance options in New York
9. Explore funding options
10. Market your business
11. Learn about business tax credits
12. Stay on top of filing requirements and taxes

Here’s a step-by-step guide to starting a business in New York:

1. Choose a business idea

Before you embark on your entrepreneurial journey, solidify your business idea. Ensure your product fills a market gap and appeals to a specific audience.

Will your business be business to consumer (B2C) or business to business (B2B)? Will you sell online, through a brick-and-mortar storefront, or both? To appeal to your target customers, conduct market research and study industry trends.

Once you have a general concept, assess your path to profitability. Figure out how much you need to sell to break even and then generate a healthy profit margin.

2. Choose a name

Your business name is the first thing potential customers will interact with—and potentially your first stumbling block when registering in the state. Think through these considerations to get the first impression (and legal requirements) right:

Is the name unique?

You can’t legally register your business with a name that’s already taken. When picking a name for your business, search your desired name in the Department of State Corporation and Business Entity Database to see if it’s available. If you’ve chosen a unique name but are still up in the air about launching your business, you can reserve your desired name for 60 days by filing a Certificate of Reservation with the New York Department of State.

Is the name trademarked?

If your business name is available at the state level, make sure no one has trademarked it at the federal level by doing a search on the US Patent and Trademark Office’s site.

Is the domain name available?

Find an available domain name that matches or represents your business name to build your web presence. Purchase and secure it as soon as possible before someone else snatches it up.

Does it include the correct business identifiers?

Your business name must include one of the following words or abbreviations: 

• Incorporated
• Inc.
• Corporation
• Corp.
• Limited Liability Company
• LLC
• L.L.C.
• Limited
• Ltd. 

Submit your application and pay the $20 filing fee.

Do you want to use a DBA?

If you want to operate your business under a name other than its legal on-paper name (for instance, if you run a sole proprietorship or general partnership where the business name is your own name), you can file for a DBA (doing business as) name. This allows you to operate publicly under a trade name.

3. Create a business plan

Consider the business plan the “big picture” strategy for your company. This written document formally describes your business and should include these elements:

• Executive summary
• Detailed business description
• Listing of products and services
• Competitive analysis
• Financial outlook
• Production, operations, and staffing plans
• Marketing plans

From Fortune 500 companies to local startups, every business needs a solid plan. While large organizations use these plans to coordinate complex operations and communicate with stakeholders, small businesses find them equally valuable for navigating growth and adapting to market changes. 

A business plan can attract investors, and creating one can help business owners clarify their goals and strategies. Consider reviewing a few examples or using a template to get started.

If you’re creating a business plan for the first time, a mentor can also help you navigate the process. “We offer training, mentorship, and networking opportunities to support business growth,” says Sandra of WBEC Metro New York, which supports more than 1,800 businesses in the Metro New York tri-state area.

4. Select a business structure

When it’s time to dive into the legal world of incorporating your company, the first step is selecting your business type. Choose a legal structure that best fits your new venture, since your business type affects factors like taxes and liabilities. The most common types of businesses are sole proprietorships, partnerships, corporations, and LLCs. Here’s what you need to know about each:

Sole proprietorship

Sole proprietorships are unincorporated businesses that offer no legal distinction between the company and the person who runs it. They’re the most straightforward business model to start and manage, but they come with the most risk to your personal assets. Since your sole proprietorship’s business income is considered personal income, you file it on your personal tax return. You are also personally responsible for any debts or obligations your business takes on, and you won’t be able to take on investors.

Partnership

Partnerships, which can be limited or general, are single businesses with two or more owners. In both taxation and liability, partnerships are treated the same as sole proprietorships. The primary difference is that two or more owners share income and responsibilities in a partnership.

C corporation

C corporations (or C corps), which can be for-profit or not-for-profit, are legal entities unto themselves. They are the most difficult business type to form and manage but offer the most fundraising opportunities, and owners are largely free from liability.

C corps are subject to income taxes. The corporate tax rate in New York is at least 6.5% for small businesses that make $5 million or less per year and 7.25% for businesses that make more than that. Then, shareholders are also taxed for any income they receive from the business.

This double taxation (combined with extra paperwork and regulations) typically makes C corps an undesirable legal structure for many small businesses. However, they can be more suitable for larger, mature businesses that would benefit from having stock options. Unlike other types of businesses, C corporations can sell as much stock as they’d like, and shares are easily transferable.

Limited liability companies (LLC)

Limited liability companies (LLCs) combine the straightforward taxation method of partnerships and sole proprietorships with the liability protection of corporations. By default, LLCs are categorized as pass-through entities. This means that the business’s income passes through the LLC to its members, so you avoid double taxation and include this money on your personal tax returns.

In the state of New York, LLCs may be subject to an annual filing fee, which ranges from $25 to $4,500, depending on your business’s gross income. As long as you follow protocols to keep your business and personal finances separate, LLCs offer their owners protection from debts or lawsuits their businesses face.

5. Register your business

If you’re operating as a sole proprietorship or general partnership, you’ll need to register your business with the New York State Tax Department. If creating a corporation or LLC for your business in New York, take the following steps:

File a Certificate of Incorporation or Articles of Organization

Your business is officially formed by filing a Certificate of Incorporation (for corporations) or Articles of Organization (for LLCs) with the New York Department of State.

You must provide your business’s name, contact information, and county, among other relevant information. You may draft your own document or use the one provided by the Department of State. You can file by mail or online. A Certificate of Incorporation is $125, and the Articles of Organization cost $200.

Appoint a registered agent

When you start a business in New York, you are required to name a registered agent to receive legal documents on behalf of the company. When your company is first formed, the New York Secretary of State will be your registered agent by default. Once incorporated, you can update your registered agent to any person, business, or agency with a New York address (not a PO box). Make sure someone at that location will be available to receive and respond to legal documents during business hours.

Adopt by-laws or an operating agreement

Although it’s not necessary to file them with the state, New York does legally require businesses to develop by-laws (for corporations) or an operating agreement (for LLCs), which are formally adopted rules for a business’s internal operations.

Review Tax Bulletin ST-175 (TB-ST-175) to determine whether you need to register for sales tax. If your goods are subject to sales taxes, then obtain a Certificate of Authority to start collecting. Do this at least 20 days before conducting business. If your business operates in multiple locations, one is required for each.

6. Get an employer identification number (EIN)

To file federal tax returns—or even open a business bank account or obtain a business credit card—you must have a federal employer identification number (EIN). This federal tax ID functions similarly to a personal Social Security number, but for a business.

The process is free and straightforward: Fill out the form on the IRS website to apply. An EIN is required for LLCs, corporations, and partnerships. However, the owner of a sole proprietorship may opt to use their Social Security number instead.

7. Apply for business licenses and permits

To find out which licenses and permits apply to your business, use the state’s New York Business Express to create a customized business checklist for your new business. If your business requires an Alcoholic Beverage On Premises License (or something similar), you will be directed to follow the application process on the State Department’s website.

8. Examine insurance options in New York

Business insurance is an important safeguard against financial risk. When starting a business in New York, you may be required to purchase several different types of insurance, especially if you plan to hire employees. Insurance options include:

• Workers’ compensation insurance. Workers’ compensation insurance is required and covers your employees’ compensation if they sustain a workplace injury.
• Unemployment insurance. If you lay off employees, unemployment insurance offers them temporary income.
• General liability insurance. General liability insurance protects your business against claims involving reputational harm, bodily injury, and property damage.
• Professional liability insurance. If your business provides professional services or advice, professional liability insurance covers things like errors, omissions, and negligence in work performance.
• Property insurance. Whether you rent or own, property insurance can cover damages caused by theft, vandalism, or fires.
• Disability insurance. New York is one of five states (including Hawaii, Rhode Island, New Jersey, and California) that require employers to provide disability benefits to employees for an illness or off-the-job injury. This often comes with paid family leave insurance as well.
• Health insurance. Under the Affordable Care Act, businesses with 50 or more employees must provide health insurance.

9. Explore funding options

You’ve probably heard the saying, “You have to spend money to make money.”

Funding sources can include personal savings or bootstrapping to raise money from friends and family, crowdfunding, angel investors, and small business loans.

Keep in mind that traditional small business loans through banks can be difficult to attain when you’re just starting out. Still, there are programs available that offer payroll, inventory, and marketing funding—options with minimal paperwork and payment flexibility.

10. Market your business

Market your business by reaching out to customers across platforms, including Facebook, Instagram, and TikTok. You can employ several different types of interconnected marketing campaigns and strategies, including press releases, social media, search engine optimization (SEO), influencer marketing, partnerships, content marketing, billboards, print ads, and more.

With the right marketing strategy, you can maximize your brand and scale your small business. WBEC Metro New York, for example, offers an invite-only SCALEit program for women entrepreneurs who want to learn how to create customized marketing plans.

11. Learn about business tax credits

New York State offers various tax credits and incentives to help new businesses thrive and grow.

The Excelsior Jobs Program provides tax credits for strategic businesses like high-tech, bio-tech, clean-tech, and manufacturing that create jobs or make capital investments. Other notable programs include the START-UP NY initiative, which allows new and expanding businesses to operate tax-free for 10 years when they are located on or near eligible university or college campuses.

Beyond state-specific credits, learn about federal tax credits that can benefit your business. The Work Opportunity Tax Credit (WOTC) can provide savings when hiring individuals from certain target groups, and research and development credits may apply if your business involves innovation or technological advancement.

💡Tip: Work with a tax professional who specializes in New York state tax law to identify all available credits and ensure you meet the qualification requirements.

12. Stay on top of filing requirements and taxes

Keep your business in good standing by complying with New York’s filing requirements. One new requirement is the Beneficial Ownership Information (BOI) reports. 

As of January 1, 2024, most companies must file BOI reports with FinCEN under the Corporate Transparency Act. New companies have 90 days from formation to file, while existing companies must file by January 1, 2025. These reports must detail individuals who own 25% or more of the company or exercise substantial control.

Other annual filings include:

• LLC filing fees: Amount varies based on income.
• Sales tax returns: Filed quarterly or monthly.
• Payroll tax turns: Filed quarterly.
• Corporate franchise tax: Required for corporations.
• Annual reports: Due in the anniversary month of formation.
• NYC-specific taxes: Additional requirements if operating in New York City.

Create a tax calendar or set up automated reminders for your deadlines. The New York Business Express website offers tools to track your requirements, and setting up an online account with the Department of Taxation and Finance can make tax management easier. 

*This post is for information only. You are responsible for reviewing and using this information appropriately. This content doesn’t contain and isn’t meant to provide legal, tax, or business advice. Requirements are updated frequently and you should make sure to do your own research and reach out to professional legal, tax, and business advisers, as needed. Businesses outside of New York will have different steps and requirements. To sell products using the Shopify platform, you must comply with the laws of the jurisdiction of your business and your customers, the Shopify Terms of Service, the Shopify Acceptable Use Policy, and any other applicable policies.

**Shopify Capital loans must be paid in full within a maximum of 18 months, and two minimum payments apply within the first two six-month periods. The actual duration may be less than 18 months based on sales.

Starting a business in New York FAQ

What are the requirements when starting a business in New York?

You must create an entity, which requires a registered agent with an address in the state of New York. You are also required to register to pay taxes, obtain any necessary licenses and permits, and get business insurance.

Do I need a business license to start a business in New York?

There is no general business license requirement in the state of New York, although some licenses and permits may be required depending on the type of business and its location. Use the New York Business Express new business custom checklist to determine what’s required for your business.

How much does a business license cost in New York?

A Certificate of Incorporation (required to form a corporation) costs $125, and filing Articles of Organization (required to form an LLC) costs $200.

What are the advantages of starting a business in New York?

New York has the country’s third-largest economy, with more than half of its workforce made up of small businesses. New York City is a major hub for a variety of different industries including finance, publishing, entertainment, food, and more. The state, and New York City in particular, also offers a diverse and well-educated workforce from which to hire.

Can I start a business in New York without being a resident?

Yes, you can start a business in New York without being a resident. The state allows non-residents to register and operate businesses as long as they comply with all regulations and requirements. However, depending on your business structure, you’ll need a registered agent with a physical New York address to receive legal documents on behalf of your company.