Step 1) Verify & Secure Your Brand Name
To secure and register your brand name it must be unique, not too similar to another registered name and shouldn’t contain any restricted wording. To check, conduct a Business Entity Search through the NJ Division of Revenue & Enterprise Services, and if there are potential trademark issues conduct another quick search using the TESS System through the U.S. Patent Office.
Keep in mind your LLC name must contain the words “Limited Liability Company,” “LLC” or “L.L.C.” In the name “Limited Liability Company” and “Limited” may be abbreviated “Ltd.” and “Company” may be abbreviated “Co.” Information about an optional reservation of name on paper Form UNNR-1 that’s good for 120 days and fees for the service can be found here: Application for Reservation of Name.
Remember, this isn’t optional in New Jersey-- it’s mandatory.
Quick Note: Before you commit 100% to a name, you may also want to check that there’s a decent URL available for your business. Use Weebly to search your options. If there’s a quality domain name for purchase, we advise buying it right away. Even if launching a business website isn’t on your radar right now, it’s going to be soon, and you might as well nail down a domain name that’ll make it easy for customers to find you!
Step 2) Appoint A Registered Agent
The next step is appointing a New Jersey registered agent to receive and help to handle/process all official documents like state filings, tax forms, legal notices, etc. They’re essential and required by law.
To be considered as registered agent, the person must be a NJ resident or NJ registered business entity with a NJ physical street address, not a P.O. Box. You can name yourself as agent for service of process.
That said, you can hire a third party professional and expect to pay up to $160/year, or get a NJ Registered Agent free of charge when you incorporate with IncFile. They handle this along with much more depending on the startup package/service you choose.
Step 3) File Certificate Of Formation
With a registered agent, once you’re ready to make your brand official in New Jersey, file a Certificate of Formation with the Division of Revenue & Enterprise Services using their Online Services page. The essential information is:
- Complete LLC name,
- Complete name and street address of registered agent, and
- An organizer’s signature.
Also, the online Certificate of Formation template on the Business Formation webpage maintained by the NJ Division of Revenue & Enterprise Services requests additional information (business address, business description, duration, registered agent email, members, etc.) that will bef public record if you choose to provide it.
Step 4) Get An EIN
An EIN, or Employer Identification Number, is required if you want a smooth tax season, to be able to set up a business bank account, to legally hire employees, and so forth.
Note: The IRS and New Jersey will allow a single-member LLC with no employees to use the social security number of the member instead of an EIN.
Most business activity is tracked using this number, so it’s not optional by any means. Thankfully, you can easily get an EIN free of charge through the IRS website. It’s quick and easy. Make sure to save the PDF document and/or number once the IRS website gives you that option! Once you click “submit” you can’t go back and must wait 2-3 weeks for the paper copy.
Step 5) Open A Business Bank Account
First of all, there are tons of choices in New Jersey from local, state and national banks as well as credit unions. Don’t be hasty. The institution you choose to be the home of your LLC’s financials is important. Do your homework and be sure to familiarize yourself with the basic perks and incentives to business banking.
Once you decide, it’s just a matter of a) syncing with your business accounting software and, b) keeping the account separate from all others so nothing gets mixed up. Here’s a quick review of Business Checking Accounts from some of the biggest banks to begin your research.
Note: Never, ever use LLC bank accounts for personal finances.
Step 6) Draft An Operating Agreement
This is a formal contractual agreement between all owners, called “members,” of your LLC that outlines financial and management responsibilities, including such critical subjects as profit sharing, salaries and ownership percentages.
It’s not mandatory or required by law, but whenever possible one should be in place to protect all parties, including the brand. And, yes, even solopreneurs should have an operating agreement.
To get started, consider checking out a free online Operating Agreement Tool which you can customize yourself.
Step 7) Handle LLC Taxes & Licensing
Obviously, getting situated with state and federal taxes isn’t optional. These days it can be much simpler though with help. How many licenses you’ll need and how many fees will be determined by a number of variables including your type of business, whether you work with governmental agencies or the public, location, etc.
Step 7 is where it really helps to work with a professional or buckle down and do the research yourself. Licenses, permits, and business taxes need to be taken care of. To get started bookmark the Newark district office of the Small Business Administration, the state’s Premier Business Services page, and the One-Stop Business Portal because they’re going to be go-to sources. If you need help, look into professional Business License Research packages that handle the legwork for you.