Starting a new business venture is an intimidating process for any entrepreneur, regardless of your levels of experience. Whether you’re just starting out, or are simply looking to expand your current business, you should consider forming a limited liability company (LLC). The difficulties that come with completing the process to the best interest of your business can be made easy by getting help from a professional and experienced business or LLC attorney.
The Benefits of an LLC
Many new companies run the risk of double taxation. Double taxation occurs when a company is registered in a different business structure, and both the owner and company are taxed. An LLC can prevent this from occurring by having the business and owner taxed only once, if the proper steps are taken.
The LLC structure also protects your own personal assets in the unfortunate case that a lawsuit is brought up against your company. This is because under an LLC, your company is considered its own legal entity with its own assets that are completely separate to you and your investors assets, and limits investor’s claims on assets to simply those they invested into the company. LLC attorneys make sure the documents are signed in the correct manner, advise on the management of bank accounts, which will ensure that no creditor can make a legal appeal to attach claims to your personal assets.
Outgrowing an LLC
Should your company grow to a point where it is in a position to begin acquisitions or if there is a need to begin a merger, an LLC has limits on its ability to protect assets during either of these processes. An LLC does allow for the addition of new partners and allows assets and interests to be purchased by another person or legal entity, making it ideal if the company is being acquired by another company. Should you be the one acquiring other companies, you may want to seek the advise of a business attorney and an accountant to determine if it is advantageous to change your business structure to a S-corp or C-corp. This will allow your company to have a stricter business structure as well as ensuring that company assets in the case of a merger are protected. This process will also allow for acquisitions to go through legally and ensure that assets are easily transferable while protecting your company’s partners.
How to Register an LLC?
While an LLC registration can be done without a lawyer, the process isn’t as straightforward as you’d like to believe. If you have independently registered an LLC, you can receive your Employer ID number from the IRS and begin the process of opening accounts. However, the LLC structure is relatively new, and can be challenging to complete on your own. The creation of an LLC is not something that you’d like to get wrong, especially considering the impact it could have on your business. With the shear amount of flexibility an LLC offers, giving your company this best start from a legal position is its own challenge. Bringing a business attorney in to advise, will help you choose a suitable name, that is not under trademark or is already registered, and the subsequent acquisition of domain names, appointment of registered agents to act on the businesses behalf, planning and implementing a business structure, and making sure that all legal are in order for registering the LLC. Having a strong legal base, will help protect your LLC should it face any lawsuit.
If you’re still unsure about the legal steps to create an LLC, the reliable and professional team at Gary I. Handin, P.A. is available to help guide you through the process of registering your LLC, and complete and file all necessary documents and compliance, so you are left to begin your businesses operations in full.