You’ve come up with a great idea for a business and are ready to start. You know there are fees, but just how much will you have to put out to get the business up and running? Your first step is to determine startup costs, long-term profitability, and, if needed, funding options.
While it might seem daunting, it’s not as difficult or expensive as you might think, especially if you use an LLC formation service like Tailor Brands. While starting a New Jersey LLC is relatively affordable, you should know the additional fees the state charges, including the cost of taxes and permits.
To start a limited liability company in New Jersey:
Taking the process one step at a time is easier than trying to absorb everything at once. Using a service to do everything for you simplifies it even more, plus allows you to have the peace of mind that it’s done correctly and that all mandatory fees are paid.
Before you can register a business in New Jersey, you must check to see if the name is available. The name search is free. You have the option of reserving a business name that is available if you are not ready to file the Certificate of Formation.
You can also file a ‘doing business as’ (DBA)—referred to as an “alternate name” in New Jersey, if you prefer to be a sole proprietor or a general partnership. Those two entities do not need to file with the Division of Revenue and Enterprise Services. However, if you wish to use a name other than your own name for the business name, you will need to register the DBA name.
You can file online, by fax, in person, or by courier service. The filing fee is $50.
Be sure to register the alternate name before you use it, or you could incur an additional fee of $50 per year the name was in use prior to registration.
New Jersey refers to articles of organization as the “Certificate of Formation.” The fee for filing the certificate of formation is $125.
Some businesses might need to file a “Certificate of Authority” if:
The cost for filing a Certificate of Authority is $125
Part of creating a new LLC is appointing a registered agent. Business owners can appoint themselves, a friend or a relative. It is free to appoint a registered agent as part of filing the Certificate of Formation.
You can also use a registered agent service such as Tailor Brands. Our services provide you with privacy and flexibility and ensure that you are compliant with state regulations. Registered agent services cost from $199 to $400 per year.
An operating agreement for a New Jersey LLC is optional. However, it is recommended that you create the operating agreement. This document serves as the rules for the limited liability company’s members. It includes voting rights, division of profits, how to fire or hire a member, and more.
The cost of an operating agreement depends on how you do it. If you are able to create your own operating agreement, the only cost is your time. It could range up to $1,000 depending on whether you retain an attorney or use our operating agreement service.
Creating a New Jersey limited liability company is not the end of costs. The LLC will have additional costs, such as:
Businesses must pay a corporation tax on adjusted net income or the portion of the business income generated in New Jersey. The state charges a minimum tax based on gross receipts.
New Jersey taxes income at:
The minimum tax is:
Businesses must file the CBT-100 tax return online using the same method of accounting that was used to complete the business’s federal tax return.
The due date for New Jersey’s corporation tax is the 15th day of the fourth month after the ending month of the accounting period. For example, if your business follows a fiscal year that ends in June, the taxes are due on or before October 15.
New Jersey businesses have additional taxes to pay. The state levies some taxes on all businesses and other taxes on certain industries. There may be additional business licenses in New Jersey, check your local county to understand if your LLC requires them.
Some of the common taxes a business might have to pay include:
All businesses registered with the Division of Revenue and Enterprise Services must file an annual report. This report notifies the state of any changes to your business. The annual filing fee for filing the report is $75.
If a business does not file the annual report, it runs the possibility of being administratively dissolved by the state. Once dissolved, you must pay penalties in addition to the filing fee to reinstate the business.
After all this talk about fees, there is good news. You can write off several of the fees, including:
Writing off these expenses decreases the amount of your net income, which then decreases the amount of taxes you pay. If you are unsure how to handle business taxes or which entity to choose, consult with a business law attorney.
New Jersey does not charge a fee for the vendor’s license. The license does not expire; thus, it cannot be renewed.
Expense | Price |
LLC Filing Fee (Certificate of Formation) | $125 |
Registered Agent Services | $200-$400 |
Reserve Business Name (optional) | $50 |
Filing a DBA (optional) | $50 |
Operating Agreement (optional) | $0-$1,000 |
Corporate Tax | $500 and up |
Annual Report | $75 |
While creating a limited liability company might seem complicated and expensive, it is not as bad as it looks upon your first review. New Jersey provides plenty of help while going through the online application process, and many of the fees are deductible from your taxes.
If you are still unsure about creating a limited liability company yourself, Tailor Brands can set up a limited liability company, provide registered agent services, and much more.
We also provide annual report services, website services, logo creation, a business email, domain services, and more to make your business look professional.
This portion of our website is for informational purposes only. Tailor Brands is not a law firm, and none of the information on this website constitutes or is intended to convey legal advice. All statements, opinions, recommendations, and conclusions are solely the expression of the author and provided on an as-is basis. Accordingly, Tailor Brands is not responsible for the information and/or its accuracy or completeness. It also does not indicate any affiliation between Tailor Brands and any other brands, services or logos.
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