Overview of New Jersey LLCs
New Jersey provides a business-friendly environment for Limited Liability Companies (LLCs) under the New Jersey Limited Liability Company Act (N.J.S.A. 42:2B). New Jersey LLCs offer liability protection, pass-through taxation, and operational flexibility with reasonable formation and ongoing compliance costs.
LLC formation and maintenance in New Jersey is handled by the Division of Revenue and Enterprise Services through the NJ Business Gateway Services online portal. Key features of New Jersey LLCs include:
- $125 filing fee - competitive formation cost
- $75 annual report - due by last day of anniversary month
- No franchise tax for most LLCs - only LLCs with gross receipts over $2 million pay Corporation Business Tax
- Fast online processing - 3-5 business days for standard filings
- Pass-through taxation at federal level
- Professional LLC option for licensed professionals
- No series LLCs - New Jersey does not allow series LLC structures
New Jersey's Competitive Advantage
New Jersey offers affordable LLC costs with $125 formation and $75 annual report fees. Located in the heart of the Northeast corridor between New York City and Philadelphia, New Jersey provides access to major markets, skilled workforce, excellent transportation infrastructure, and proximity to venture capital. The state has no franchise tax for most LLCs (only those with $2M+ gross receipts pay CBT).
Step-by-Step Guide to Forming a New Jersey LLC
Step 1: Choose a Name for Your New Jersey LLC
Your LLC name must comply with New Jersey naming requirements under N.J.S.A. 42:2B-5:
- Required Designation: Must include "Limited Liability Company," "LLC," or "L.L.C."
- Distinguishable: Must be distinguishable from names of existing entities on file with Division of Revenue
- Restricted Words: Cannot use "bank," "trust," "insurance," "university," "college," or similar terms without proper licensing
- Not Misleading: Cannot falsely suggest government affiliation or imply purposes the LLC is not authorized to pursue
Check Name Availability
- Online Search: Use NJ Business Gateway Services Name Search
- Free Search: Name availability check is free
- Reserve Name: You can reserve a name for 120 days for $50
- Renewal: Name reservation can be renewed
Step 2: Appoint a Registered Agent
Every New Jersey LLC must have a registered agent (N.J.S.A. 42:2B-7):
- Requirements: Must be a New Jersey resident (individual) OR a New Jersey business entity authorized to do business in New Jersey
- Physical Address: Must have a physical street address in New Jersey (P.O. boxes NOT allowed)
- Responsibilities: Receives service of process, legal notices, and official state correspondence
- Availability: Must be available during normal business hours
- Consent: Agent must consent to appointment
Registered Agent Options
| Option | Cost | Pros/Cons |
|---|---|---|
| Yourself | Free | + No cost - Home/business address becomes public - Must be available during business hours |
| Professional Service | $100-$300/year | + Privacy protection + Reliability + Compliance alerts - Annual fee |
| Attorney/Accountant | Varies | + Professional relationship - May charge fees - Continuity issues if relationship ends |
Step 3: File Public Records Filing for New Business Entity
File your Public Records Filing for New Business Entity with the Division of Revenue to legally create your LLC:
Required Information
- LLC Name: Official legal name including LLC designation
- Principal Office Address: Physical address (can be out-of-state)
- Registered Agent: Name and New Jersey street address
- Registered Office: New Jersey street address where agent can be reached
- Effective Date: Date LLC existence begins (can be immediate or future date)
- Purpose: Statement of business purpose (can be general)
- Management Structure: Member-managed or manager-managed
- Authorized Person: Name of person executing the filing
Filing Methods & Fees
| Method | Fee | Processing Time |
|---|---|---|
| Online Filing | $125 | 3-5 business days |
| Mail Filing | $125 | 3-4 weeks |
| 24-Hour Expedited | $125 + $50 expedite fee | 1 business day |
Online Filing: File at NJ Business Gateway Services
Mailing Address (Paper Filing):
NJ Division of Revenue and Enterprise ServicesBusiness Services
PO Box 450
Trenton, NJ 08646
Step 4: Create an Operating Agreement
While New Jersey does not require LLCs to have an operating agreement, creating one is highly recommended:
Purpose of Operating Agreement
- Legal Protection: Reinforces limited liability protection by establishing LLC as separate legal entity
- Ownership Structure: Documents each member's ownership percentage and capital contributions
- Management Rules: Specifies whether LLC is member-managed or manager-managed
- Profit Distribution: Outlines how profits and losses are allocated among members
- Decision-Making: Establishes voting rights and procedures for major decisions
- Buyout Provisions: Defines what happens when a member wants to leave or dies
- Dispute Resolution: Provides procedures for resolving conflicts
Key Provisions to Include
- Member names, addresses, and ownership percentages
- Initial capital contributions
- Management structure (member-managed vs. manager-managed)
- Voting rights and thresholds for major decisions
- Profit and loss allocation
- Distribution rules
- Transfer restrictions and buyout procedures
- Dissolution procedures
- Indemnification provisions
Important: Operating agreement is an internal document - do NOT file with the state. Keep it with your LLC records.
Step 5: Obtain an EIN (Employer Identification Number)
Most LLCs need a federal Employer Identification Number (EIN) from the IRS:
- Required For: Multi-member LLCs, LLCs with employees, LLCs taxed as corporations, opening business bank accounts
- Optional For: Single-member LLCs with no employees (can use owner's SSN, but EIN recommended for privacy)
- How to Apply: Free online application at IRS.gov
- Processing Time: Instant (receive EIN immediately upon online application approval)
- Cost: Free (beware of third-party services charging fees)
Step 6: File Annual Report
New Jersey requires all LLCs to file an annual report with the Division of Revenue:
- Filing Deadline: Last day of the anniversary month of formation
- Fee: $75 annually
- Example: If you formed LLC in March 2025, first annual report due March 31, 2026
- Required Information:
- LLC name and file number
- Principal office address
- Registered agent name and address
- Names and addresses of members/managers
- Filing Method: Online via NJ Business Gateway Services (recommended)
- Late Filing: Late fees apply; prolonged non-filing can result in administrative dissolution
Anniversary Month Filing System
New Jersey annual reports are due by the last day of the anniversary month. For example, if you formed your LLC on March 15, 2025, your first annual report is due by March 31, 2026, and by March 31 every year thereafter. This gives you the entire month to file rather than requiring filing on the exact anniversary date.
Step 7: Comply with Local Requirements
After forming your LLC with the state, comply with local requirements:
- Municipal Registration: Register with municipal clerk in the city/town where you conduct business
- Business License: Obtain any required local business licenses or permits
- Zoning Compliance: Ensure business location complies with local zoning ordinances
- Trade Name: If using a name different from LLC legal name, register trade name (DBA)
- Sales Tax Registration: Register for New Jersey sales tax if selling taxable goods (NJ Division of Taxation)
- Employer Registrations: If hiring employees, register for unemployment insurance and workers' compensation
New Jersey LLC Taxation
Understanding New Jersey's tax structure is important for budgeting:
Federal Income Tax
- Default Classification: Single-member LLCs are "disregarded entities"; multi-member LLCs are partnerships
- Pass-Through Taxation: LLC profits/losses pass through to members' personal tax returns
- Self-Employment Tax: Active members pay self-employment tax (15.3%) on their share of profits
- Optional S-Corp Election: Can elect S-corporation tax treatment for potential self-employment tax savings
New Jersey Gross Income Tax
- Personal Income Tax: Progressive rates from 1.40% to 10.75%
- Pass-Through: LLC income passes through to members who report on NJ-1040
- Non-Resident Members: Non-resident members pay NJ tax on NJ-source income
- Pass-Through Business Alternative Income Tax (BAIT): Optional entity-level tax for pass-through entities (allows workaround to SALT deduction cap)
New Jersey Corporation Business Tax (CBT)
Most LLCs are NOT subject to CBT unless they elect to be taxed as corporations or meet certain thresholds:
| LLC Type | CBT Requirement |
|---|---|
| Single-Member LLC (Disregarded) | No CBT (member pays gross income tax) |
| Multi-Member LLC (Partnership) - Under $2M Gross Receipts | No CBT (members pay gross income tax) |
| Multi-Member LLC (Partnership) - $2M+ Gross Receipts | Subject to CBT (6.5%-11.5% on allocated net income) |
| LLC Taxed as C-Corp | Subject to CBT (6.5%-11.5%) |
| LLC Taxed as S-Corp | Subject to CBT (6.5%-11.5%) |
Sales and Use Tax
- Rate: 6.625% statewide
- Urban Enterprise Zones: Reduced 3.3125% rate in designated zones
- Registration: Required if selling taxable goods or services in New Jersey
- Filing: Monthly, quarterly, or annually depending on sales volume
- Contact: New Jersey Division of Taxation
Ongoing Compliance Requirements
Annual Report
- Due Date: Last day of anniversary month
- Fee: $75
- Late Penalty: Late fees apply
- Filing: Online via NJ Business Gateway Services
Federal & State Tax Returns
- Federal: Form 1065 (multi-member), Schedule C (single-member), or corporate return if elected
- New Jersey: NJ-1065 (partnership), NJ-1040 (individual members)
- Estimated Taxes: Quarterly estimated tax payments if LLC owes significant tax
Employment Taxes (If You Have Employees)
- Federal: Quarterly Form 941 (payroll taxes), annual Form 940 (unemployment)
- New Jersey: Withholding tax (NJ-927), unemployment insurance, disability insurance, family leave insurance
Registered Agent
- Maintain Agent: Must have registered agent at all times
- Update Changes: File amendment if agent or registered office changes
Amendments & Changes
File amendments with Division of Revenue when making changes:
| Change Type | Form | Fee |
|---|---|---|
| LLC Name | Certificate of Amendment | $75 |
| Registered Agent/Office | Certificate of Amendment | $75 |
| Principal Office | Update on next Annual Report | No fee (included in $75 annual fee) |
| Add/Remove Members | Update operating agreement (no filing required) | N/A |
Dissolving a New Jersey LLC
Step 1: Member Vote
- Follow dissolution procedures in operating agreement
- Document decision in written resolution
Step 2: Wind Up Business Affairs
- Notify creditors, customers, and business partners
- Pay all outstanding debts and obligations
- Liquidate assets
- Distribute remaining assets to members
- Cancel business licenses and permits
- Close EIN with IRS
Step 3: File Certificate of Cancellation
- Form: Certificate of Cancellation
- Fee: $100
- Filing: Online via NJ Business Gateway Services or mail
- Required: Statement that all debts paid or adequate provision made
Step 4: File Final Tax Returns
- File final federal and New Jersey tax returns marked "FINAL"
- Pay any remaining tax liabilities
- File final annual report
Professional LLCs
New Jersey allows certain licensed professionals to form Professional Limited Liability Companies:
Eligible Professions
- Attorneys
- Physicians and surgeons
- Dentists
- Optometrists
- Chiropractors
- Podiatrists
- Certified public accountants
- Architects
- Engineers
- Land surveyors
- Psychologists
- Other licensed professionals
Professional LLC Requirements
- Licensed Members: All members must be licensed in the profession
- Name: Can use "LLC" or "L.L.C." designation
- Professional Liability: LLC does not shield members from their own professional malpractice
- Formation: Same process as standard LLC
Common Mistakes to Avoid
- Missing Annual Report Deadline: File by last day of anniversary month to avoid late fees
- Using P.O. Box for Registered Agent: Registered agent must have physical street address
- No Operating Agreement: Failing to create operating agreement leaves gaps in governance
- Commingling Funds: Mixing personal and business finances can pierce LLC liability protection
- Ignoring CBT Threshold: LLCs with $2M+ gross receipts must file CBT returns
- Skipping Local Registration: Must register with municipal clerk in addition to state filing
- Not Registering for Sales Tax: Required before making first taxable sale
Frequently Asked Questions
How much does it cost to form an LLC in New Jersey?
The New Jersey LLC filing fee is $125 for the Public Records Filing for New Business Entity. The annual report fee is $75, due by the last day of the anniversary month. Total first-year costs are approximately $200 plus any registered agent fees.
How long does it take to form an LLC in New Jersey?
Online filings through NJ Business Gateway Services are typically approved within 3-5 business days. Expedited 24-hour processing is available for an additional $50 fee.
When is the New Jersey LLC annual report due?
New Jersey annual reports are due by the last day of the anniversary month of formation. For example, if you formed your LLC in March 2025, your first annual report is due by March 31, 2026. The filing fee is $75.
Does New Jersey require an operating agreement for LLCs?
New Jersey does not legally require an operating agreement, but it is highly recommended. An operating agreement outlines ownership structure, management, profit distribution, and procedures for major decisions. While not filed with the state, it provides legal protection and clarity for members.
What are New Jersey LLC name requirements?
New Jersey LLC names must include "Limited Liability Company," "LLC," or "L.L.C.," be distinguishable from existing business names on file with the Division of Revenue and Enterprise Services, and not contain restricted words ("bank," "trust," "insurance," "university") without approval. Check availability using NJ Business Gateway Services.
What taxes does a New Jersey LLC pay?
New Jersey LLCs pay federal income tax (pass-through to members), New Jersey gross income tax (progressive rates 1.40%-10.75% on members' share), and the $75 annual report fee. LLCs with gross receipts over $2 million may be subject to Corporation Business Tax. Sales tax is 6.625% statewide.
Can I be my own registered agent in New Jersey?
Yes, any New Jersey resident or business entity with a physical New Jersey address can serve as registered agent. However, the agent must be available during normal business hours to accept service of process. Many LLCs use professional registered agent services ($100-$300/year) for privacy and reliability.