How can an LLC Help Me Avoid Trouble with Partners
An LLC operating agreement can be used to outline duties and responsibilities as well as rights of each member, owner, partner. That avoids disputes.
An LLC can be used as a sole proprietor, partnership, or corporation.
Thus, according to your situation, just select the type most saves you taxes.
An LLC protects both your business and personal assets. This is because it is a separate corporate legal person entity. Read below:
As a sole proprietor, you will be PERSONALLY liable for all duties and liabilities
of your business, such as business debts and lawsuit judgments.
Likewise, a corporation is liable for its own wrongs and corporate assets can be liquidated to satisfy a judgment creditor.
On the other hand, an LLC is far better and superior.
As opposed to a sole proprietorship and a corporation, an LLC will protect itself and your personal assets.
For example, if you are sued for a business wrong, the judgement creditor cannot access your personal assets such as your home and car, nor can he or she access your LLC assets such as your business equipment ( in most cases).
1. An LLC protects both your personal assets against business actions and your LLC assets ( corporations do not protect corporate assets)
2. You can allocate duties and rights as well as profits and ownership %s. You cannot do that with a corporation.
3. You need far less paperwork such as corporate minutes, meetings etc. Corporations must have these corporate formalities.
4. You can run an LLC as a sole proprietorship, a partnership or as a corporation.
5. If you do not run as corporation, you avoid double taxation.
Our filing service includes both the LLC official certificate and the operating agreement.
You legally need both of these to run your LLC.
The certificate contains the name, address and the registered agent ( could be yourself ).
The LLC operating agreement contains the rules that your will run it including the percentage of ownership ( 100% if you are one owner ) and other terms such as what duties will the members have if more than one owner. |
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