It's the tax form that feels like a prank. You’ve already filed your federal return, you’ve handled your state partnership return, and you think you’re in the clear. Then, your accountant mentions Form IT-204-LL. Or worse, you get a notice from the New York State Department of Taxation and Finance wondering where their money is. It’s annoying. It's specific. And for thousands of small business owners in New York, it's the one piece of paperwork that leads to a totally avoidable penalty.
Basically, if you run a Limited Liability Company (LLC), a Limited Liability Partnership (LLP), or a regular Partnership that has any New York source income, this form is your new best friend—or your worst enemy. It’s not just an information return; it’s a bill.
What is Form IT-204-LL anyway?
Let’s get the technical jargon out of the way. Form IT-204-LL is the Partnership, Limited Liability Company, and Limited Liability Partnership Filing Fee Payment Form. Most people just call it the "LLC Filing Fee." Unlike many other states where you pay a flat annual fee to the Secretary of State, New York ties this fee to your income. It’s a graduated scale.
If you are an LLC that is treated as a partnership for federal tax purposes, or if you’re a disregarded entity (like a single-member LLC), you likely owe this. Even if you didn't make a dime in profit but had $1 of New York source income, you're on the hook.
The state doesn't care if you're losing money. They want their cut for the privilege of you doing business within the borders of the Empire State. Honestly, it feels a bit like a "pay to play" model, but that’s the reality of the New York tax code.
The Deadlines That Trip Everyone Up
Here is where the wheels usually fall off. For most tax forms, you think of April 15th. For partnership returns (Form IT-204), the deadline is usually March 15th.
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Form IT-204-LL follows the March 15th rule for calendar-year filers.
If you miss this, the penalties start stacking up immediately. New York is notoriously aggressive about this. Unlike a federal extension that gives you more time to file but not more time to pay, the IT-204-LL fee is due by that mid-March date regardless of whether you’ve finished your actual tax return. You can’t just ignore it because your books aren't closed yet. You have to estimate your New York source gross income and pay up.
Figuring Out Your "New York Source Gross Income"
This is the number that determines how much you pay. It isn't your net profit. That's a huge distinction people miss. You could have $2 million in sales and $2.1 million in expenses—meaning you lost $100,000—but New York will still charge you based on that $2 million figure.
- If your NY source gross income is less than $100,000, you pay $25.
- If it’s between $100,000 and $250,000, it jumps to $50.
- Once you cross that $250,000 threshold, the fees start climbing significantly.
- At the very top end, if you're doing over $25 million in NY source income, you're looking at a $4,500 fee.
The calculation for "New York source gross income" for Form IT-204-LL is essentially all the income, gain, loss, and deduction derived from or connected with New York sources. If you have a physical shop in Brooklyn, all those sales count. If you’re a consultant living in New Jersey but all your clients are in Manhattan, you’ve got some math to do regarding apportionment.
The Single Member LLC Exception (Sorta)
There is a common misconception that if you are a "disregarded entity"—meaning you report your LLC income on your personal Schedule C—you don't need this form. That is wrong.
If you are a single-member LLC (SMLLC) and you are an individual, you still have to file Form IT-204-LL if you have New York income. The only real "out" is if you had zero New York source income, gain, loss, or deduction for the entire year. But if you're doing business in NY, that's almost never the case.
Common Mistakes That Trigger Audits
New York's Tax Department has gotten incredibly good at data matching. They look at your Federal 1065 or your personal 1040. If they see a "doing business as" or an LLC name associated with a New York address, and there's no corresponding IT-204-LL on file, the system flags it.
One major blunder? Forgetting to check the "Tiered Partnership" box if it applies. If your LLC is owned by another LLC, things get complicated fast.
Another one is the "Regular IT-204 vs. IT-204-LL" confusion. Filing the full partnership return (IT-204) does not satisfy the requirement to file the fee form (IT-204-LL). They are two separate filings. Think of the IT-204 as the "here is what we did" form and the IT-204-LL as the "here is your money" form.
How to File Without Losing Your Mind
You have to do this online. New York has moved almost entirely to electronic filing for business taxes. You’ll need a Business Online Services account through the NY.gov website.
- Log in early. Don't wait until March 14th at 11:00 PM. The site has been known to chug or crash under high volume.
- Have your federal numbers ready. You need your total assets and your gross income figures from your federal return.
- Check your EIN. Using the wrong Employer Identification Number is the fastest way to ensure your payment never gets credited to your account.
- Pay via ACH. It’s the smoothest way to handle the payment without worrying about checks getting lost in the mail at the Albany processing center.
Real World Example: The Brooklyn Coffee Shop
Let's say you and a partner own a small coffee shop in Williamsburg. In 2025, your gross sales (total money through the register) were $450,000. After paying for beans, rent, labor, and that expensive espresso machine repair, you actually only made $40,000 in profit.
When you go to file your Form IT-204-LL, you don't look at that $40,000. You look at the $450,000.
Because $450,000 falls in the bracket between $250,000 and $500,000, your filing fee is $175. If you had looked at your profit ($40,000), you would have mistakenly thought you only owed $25. Underpaying is just as bad as not filing; New York will send you a bill for the difference plus interest.
What Happens if You Just... Don't?
Maybe you're thinking about skipping it. Don't.
The late filing penalty is $50 per month for each month the failure continues, up to a maximum of $250. That might not sound like a lot, but if you have multiple members in the partnership, that penalty can actually be multiplied by the number of partners in some scenarios. Plus, they tack on interest.
More importantly, if you want to close your LLC or get a "Certificate of Good Standing" to get a bank loan or sell your business, any outstanding IT-204-LL issues will stop the process dead in its tracks. New York will not let you go until they have their filing fees.
Nuances for Out-of-State Entities
If you have a Delaware LLC but you’re working out of a co-working space in Manhattan, you are "doing business" in New York. You have to file.
This is the trap for "digital nomads" or remote service providers. If you are physically present in New York while performing services for your LLC, that income is generally considered New York source income. You might think you're flying under the radar, but once you file a New York non-resident or part-year resident personal return, the state will look for the entity-level filing.
Actionable Steps for This Tax Season
Stop treating this as an afterthought. It is a core compliance requirement for New York business owners.
- Audit your LLC status: Check if you are registered as an LLC, LLP, or a partnership. If you are a corporation (S-Corp or C-Corp), this form doesn't apply to you—you have different forms like the CT-3.
- Review your 2025 Gross Income: Look at your total sales before expenses. Find where you land on the NY fee scale.
- Mark March 15th on the calendar: Even if your accountant is handling it, ask them for a copy of the "LLC Filing Fee" receipt.
- Set up your NY Online Services account now: If you don't have one, it can take a few days to verify your identity and get access.
- Separate the payments: Ensure your tax software isn't just "calculating" the fee but is actually "submitting" the payment. Some software requires a separate click or authorization for the IT-204-LL compared to the IT-204.
Taking twenty minutes to handle this properly in March saves you hours of back-and-forth with the tax department in October. It's a small price to pay for staying in the state's good graces.