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LLCs have an easier time finding financing than partnerships and sole proprietorships because they offer a formal structure for investors and lenders. Moreover, a LLC offers flexibility to distribute gains disproportionately to investment in the business. (As stated previously, this must pass IRS special allocation tests.)
There are a number of financing issues involving LLCs, including:
The [...]
Wed, September 26 2007 » Business Loans, Business Structures, Find Investors, Limited Liability Company » 1 Comment
For a single-owner LLC, you just need to add a Schedule C, “Profit or Loss from Business,” (available at http://www.irs.gov) and submit it with your tax returns. For a multi-owned LLC, you will need to file Form 1065, “U.S. Return of Partnership Income” (same as with partnerships). Furthermore, the members of the multi-owned LLC need [...]
Wed, September 26 2007 » Business Structures, Limited Liability Company, Taxes, Tips » 1 Comment
Maintaining Corporate Identity
It is important to separate the identity of the corporation from its owners. This will help you protect your limited liability status. Ensure that you:
Make all annual filings with the Secretary of State.
Operate the company under its name, making sure that the people doing business with your company know that the company is [...]
Wed, September 26 2007 » Business Structures, Limited Liability Company, Tips » 1 Comment
As with corporations, there are certain exceptions to the limited liability protection afforded by the LLC:
· The LLC defaults on a loan that an owner personally guarantees.
· The managers do not deposit the taxes withheld from employee wages.
· A member injures someone.
· The owner does not separate the corporation as an independent entity; that is, [...]
Wed, September 26 2007 » Business Structures, Limited Liability Company, Tips » 1 Comment
Creating an LLC Operating Agreement
The LLC operating agreement allows you to coordinate your financial, operational, and working conditions with your partners. As with a partnership, the LLC lets you elect to run your company with your rules and not by the default rules set your State (which would come into affect if you did not [...]
Wed, September 26 2007 » Business Structures, Limited Liability Company » 1 Comment
The Limited Liability Company (LLC) is a business structure that affords the limited liability protection of a corporation and the management flexibility of a sole proprietorship or a partnership. In case of a lawsuit or unpaid debt, only the business assets are at risk.
In contrast with a business set up as a corporation, a LLC [...]
Wed, September 26 2007 » Business Structures, Limited Liability Company » 1 Comment
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