LLC

What it is?

  • An LLC is a hybrid between a partnership and a Corporation, in that it is subject to “pass-through” tax treatment of a partnership with limited liability to its shareholders
  • An LLC can be managed by one or more of its managers or by its members

Basic Protections

  • Provides limited liability to the shareholders

Formalities to Set-Up

  • Requires Articles of Organization to be filed with the Secretary of State
  • The LLC must adopt an Operating Agreement which outlines the management of the LLC
  • Membership certificates should be issued

Maintaining LLC Formalities

  • Much like a corporation, in order to maintain the LLC properly, many formalities need to be adhered to, including:
    • Keeping LLC assets in separate accounts from personal assets.  Do not commingle assets between the LLC and its members
    • Conducting regular meetings by the members and/or managers and keeping proper record of the minutes of those meetings
    • Maintain records of the current members and the membership certificates that have been issued