Can you reduce New York LLC publication fee by using a registered agent?

The consequence of not publishing/violating publication rules is discussed in the article below. The impact of not publishing is negligible for most tech startups such as yours. If you ask yourself who's enforcing this requirement and how it could be enforced, you'll see it's a bureaucratic nightmare for the NY DoS. NY DoS doesn't even have direct authority over the County clerks.

Your LLC does not lose limited liability protection for failure to publish. The only substantial consequence to failing to publish your LLC formation is that your LLC loses the power to sue another party in court, and this power can be restored when you do decide to publish. Most startups hardly ever have a reason to sue another entity, and when/if you have to cross that bridge, you can always choose to complete the publication.

This is only my personal evaluation based on caselaw/historical observations on this matter. It is not legal advice, and should not be considered as such.

http://www.eminutesonline.com/what-happens-if-you-ignore-new-york%E2%80%99s-llc-publication-requirement/

In re Equities Capital Corp., is recent bankruptcy case involving the publication requirement. In that case, a foreign LLC (which is subject to publication requirements that are nearly identical to those applicable to New York LLCs) sought to retain a contract deposit after the debtor (Equities Capital) failed to close on a transaction involving an option contract. The debtor argued that the foreign LLC—which did not fulfill the publication requirement within 120 days of qualifying to do business in New York—couldn’t recover for breach of the option contract because: (1) it didn’t have the authority to enter into the option contract in the first place; and (2) therefore couldn’t sue to keep the deposit. The court rejected the debtor’s argument on two grounds. First, the court noted that §802 of the Limited Liability Company Law (which is substantially identical to §206) explicitly says that the failure to comply with the publication requirement “shall not limit or impair the validity of any contract or act of such . . . limited liability company, or any right or remedy or any other party under or by virtue of any contract, act or omission of such . . . limited liability company.” Second, the court pointed out that, under the same statute, when an LLC files documentation of its substantial compliance with the publication requirement, the previous suspension of its authority to do business in New York is annulled. Since the debtor complied with the publication requirement after the litigation over the deposit commenced, the suspension was revoked, retroactive to the date the LLC started doing business in New York; in other words, it was as if the suspension had never happened. A handful of New York state courts have been faced with similar arguments in cases involving New York LLCs, and all have reached the same conclusion. Thus, an LLC that wishes to enforce a contract doesn’t even have to wait until publication is complete to sue for breach of contract: it can cure its failure to publish even after it files a lawsuit. So, while we can’t advise you to ignore the law, we can tell you that our legal research hasn’t revealed a single case in which an LLC suffered any negative consequences because it failed to comply with the New York LLC publication requirement.

Everyone here seems to be operating on old information. Yes, in the past, the only consequence of not filing was the possibility you would be forbidden to initiate an action in a NYS court, though you could still defend one brought against you. Used to be that you could simply publish after the fact and restore your ability to initiate an action if you so desired.

BUT... a couple of years ago there was a case in which an LCC owner took NYS to court on the basis that this publishing requirement was somehow unfair/illegal. She lost the case. And as a result the law on the publishing requirement was changed significantly. They extended the time allowed to publish, but more to the point, increased the penalties for not publishing significantly. Now, if you don't publish, your LLC can be suspended and its right to do business in NYS revoked. This is a significantly more onerous penalty. To the best of my knowledge this provision has yet to be enforced, and the chances may be slim of it ever being enforced, but if it is - your business is dead in the water.

Not worth it, in my opinion - just pay the publishing fee until saner heads prevail one day and remove this stupid uncompetitive mandate.

All this is my opinion, I am not a CPA or attorney. Check with yours before making a decision either way.

my suggestion: form the LLC in a friendlier jurisdiction.

like Wyoming. it costs $100 only, and you can find a registered agent to do it free for a year (and then $99 after that.) the annual state requirements are $50 only. This literally only takes 3 days. Wyoming levies no income tax but you will ultimately pay that in NY anyway since your LLC is a pass through entity.

the NY publishing racket only applies once your LLC owns property in the state, not does business in the state. Even if this is open to interpretation the consequences are moot , your LLC simply won't be "in good standing" with the state, in which case you can publish and get that status fixed anytime in the future. who checks this? banks.... mayyyybbbee. and they certainly do not care if your llc is in a different jurisdiction, you get the bank account, clients can send you money, you can sign up to all the app stores you want, get paid, ignore the state.

along with NY publishing racket, you will need to get a $200 certificate of authority which may be annual. If you don't get both of these things, your LLC will not have access to NY State Courts, so lets say you needed to sue someone to collect you wouldn't be able to do it in NY under your LLC's name.

most other jurisdictions are friendlier in this regard.