If you are planning to start a business in New York, we have some positive news. Small businesses enjoy a 99 percent share of all companies in the state, meaning you are joining a super-friendly world. But there are things you need to know before rushing headlong into the implementation phase. Here are some of the most important ones:
Table of Interest
1. Pay attention to regulations
Businesses in various niches are bound by dozens of unique regulations. You need to understand your industry from the legal front to avoid clashing with the law. Some of New York’s most instrumental laws include:
- Antitrust laws, for fostering competition;
- Deceptive trade practice laws, meant to prevent product tampering, false advertising, etc.;
- Statute of limitations for civil actions such as false imprisonment, professional malpractice, property damage, and personal injuries; and
- Interest rate laws.
2. Your business will be subject to high taxes.
New York’s taxes are relatively high, whether you want to set up a new business or take over an existing one. The state’s Tax Guide for New Businesses contains the procedures you need to follow and the documents you need to fill out when starting a business from scratch. There is also plenty of useful information for individuals who want to buy businesses or assets from existing establishments.
3. Trademark infringement is commonplace.
Your business can violate another business’ or individual’s trademark by using their name or a similar name to provide related products or services. Avoiding trademark issues in a state with more than 2 million businesses is extremely difficult. Companies often get slapped with cease and desist demands or lawsuits, which set them back a lot of cash.
You don’t want to fall for these pitfalls. Before naming your brand or product, ensure the name is not being used by any other company, particularly those in your industry. A copyright lawyer can walk you through the process, ensuring that you don’t step on anyone’s toes.
4. You need a Federal Employer Identification Number.
Application for an Employer Identification Number (EIN) is offered for free by the Internal Revenue Service (IRS). Businesses must meet the following conditions to apply for this number:
- Have employees
- Operate as a partnership or corporation
- File excise, employment, firearms, alcohol or tobacco taxes
- Offer an HR 10 pension plan
5. There are a dozen insurance obligations to worry about
Insurance obligations for New York businesses include:
- Workers’ Compensation, which is required of any company that has employees. You can obtain Workers’ Compensation insurance from a private carrier or the New York State Insurance Fund or seek self-insurance approval from the NYS State Workers’ Compensation Board.
- Unemployment Insurance, which is required of any company that meets the prerequisites for liability.
- Disability Benefits insurance, which covers off-the-job injuries for businesses that use employee services for at least 31 days in a year.
These are some of the fundamentals you need to pay attention to if you want to start your business on the right foot. Talk to an investment expert if you haven’t developed a business idea yet. If you are eyeing an existing business that has pending legal issues, seek the advice of a seasoned corporate lawyer.