What are the advantages of forming an LLC?

A Limited Liability Company combines the advantages of a corporation and a partnership. The members of the LLC are allowed limited liability protection of a corporation with the pass-through taxation of a partnership. All personal assets of the members are protected from creditors for debt and from judgments against the LLC. Provided a member did not use their personal assets to secure loans or personally guarantee the debt. Unlike a Sub-Chapter S Corporation whose shareholders are limited to 75, there is no limit to how many members an LLC can have. For the flexibility and taxation benefits, LLC’s have become very desirable to business owners. Questions about forming a limited liability company or LLC? Call Sun Document Karis 888.595.2747 Fax: 888.955.2747

The Disadvantages Of LLC?

Are there any disadvantages? There is generally more paperwork and filing requirements to create an LLC than a general partnership. In many states, general partnerships do not have to be filed with the state filing agency. More often, general partnership documents are filed at the Recorder’s Office in the County of residence or place of business. Unlike a corporation whose existence is perpetual, many states require an LLC to designate a dissolution date in the formation document.

In some states, when a member dies, resigns, is expelled or files for bankruptcy, the LLC is dissolved or less otherwise stated in their Articles of Organization or Operating agreement. It is often possible for the majority of members to have a vote to continue the LLC as long as the vote takes place within a short time frame; generally 90 days. Most often, the state agency will allow you to amend the dissolution date at a future time if you are so inclined. Although LLC’s are a fast growing business entity, there is still a lack of wide spread acceptance of an LLC. Depending upon the state, there can be restrictions on rendering professional services. In California, an LLC is forbidden to provide any service that requires a professional state license. Do you have any questions about filing a LLC? Call Sun Documents Karis 888 595-2747

What is a Limited Liability Company or LLC?

A limited liability company is a type of business entity that is independent of its owner. It can consist of one or more members which may be individuals, partnerships, limited partnerships, trusts, estates, associations, corporations, other limited liability companies or other business entities. The members of a limited liability company are afforded limited liability similar to shareholders of a corporation and are allowed pass-through taxation that is comparable to a partnership. Questions about a limited liability company or LLC? Call Sun Documents Karis 888.595.2747 Fax: 888.955.2747 Sun Document Filing.