NY LLC Publication Law Grows Teeth
I see it pretty often – that dazed and bewildered stare, those glassy eyes, a politely suppressed sight (or worse, yawn). Yes, those are the reactions of my clients when I try to explain New Yorkstate’s LLC publication requirement. As a business owner, you may find it difficult to justify spending about a thousand dollars to publish a minuscule advertisement that nobody will read. It is, however, within your best interest to understand the impact of New York state’s LLC publication requirement, especially when New York is just about to crack its whip on delinquent business owners.
On February 3, 2006, Governor George E. Pataki signed New York Senate Bill 85-A which alters publication requirements for limited liability companies, limited partnerships and limited liability partnerships (I will collectively refer to them as “LLCs”). The law will come into effect on June 1, 2006. So what does it all mean? Under the current law, LLCs have to fulfill their publication requirements within 120 days of filing their LLC papers (i.e. articles or organization). If the LLC fails to do so, then the LLC cannot maintain an action or proceeding in New York State.
The new law has a lot more teeth – as of June 1, 2006, any LLC that fails to fulfill its publication requirement will face suspension of its authority to conduct or transact any business in New York State. To make matters worse, this suspension could potentially leave LLC members without any limited liability (read – your personal bank account is at risk) until the publication requirement has been fulfilled.
So next time we warn you that you should spend that extra thousand dollars for publication – just listen to us, it is a sound investment for your company’s future.
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