What is an 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
- 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