- What is a Limited Liability Company (LLC)?
- How is a Limited Liability Company formed?
- What do you name a LLC?
- How long does it take to form a Limited Liability Company?
- Does a LLC need a registered agent?
- Does the LLC need a tax number?
- How is a Limited Liability Company taxed?
- Can one person form a Limited Liability Company?
- Are there directors and shareholders with a LLC?
- What determines the structure of a LLC?
- Who manages the Limited Liability Company?
- What are the advantages of a LLC?
- What are the disadvantages of a LLC?
- Is an accountant or attorney needed to form a LLC?
What is a Limited Liability Company?
A Limited Liability Company (LLC) is a separate legal entity that offers the limited
liability protection of a corporation along with the advantages of passing through
profits or losses like a partnership.
How is a Limited Liability Company formed?
In order to form a Limited Liability Company, Articles of Organization must be filed with the required state fee. This is all provided when you order through Speedy.
What do you name a Limited Liability Company?
The name you select for your limited liability company must be distinguishable form any other limited liability company within your state. The purpose of this is to make sure your name is unique and will not be confused with another company. When selecting a name for your limited liability company, you must make sure it does not contain any type of punctuation and must end with the words “Limited Liability Company or the abbreviation LLC or L.L.C.”. In the event that you first name selection is not available, we select the second and third until we have an available name.
How long does it take to form a Limited Liability Company?
The Speedy LLC order form takes less than 15 minutes to complete. We process your Articles of Organization within 24 hours with the state you choose. Each state has different time frames which it completes the filing process. Some states take as little as an hour while others can take several weeks. Speedy has no control over the state processing time. Some states offer an expedited service at an extra charge. The Speedy order form allows for the expedited service for the states which offer it.
Does a Limited Liability Company need a registered agent?
Yes. All Limited Liability Companies need a registered agent with a physical street address within the state of formation. This allows a location for any type of legal documents or tax documents to be delivered to if they are returned from the company designated address. Should you wish to form a Limited Liability Company in a state other than your own or do not wish to be the registered agent yourself, Speedy can provide registered agent services for a nominal fee.
Does the Limited Liability Company need a tax number?
All Limited Liability Companies need a Federal Identification Number. This is the same thing as an Employer Identification Number or an E.I.N. and is used as an identification number for the Limited Liability Company. This number is obtained from the Internal Revenue Service by filing Form SS-4. Some states use the same number but others require filing for one with the particular state. All this is included as part of the Speedy order process with the complete package or EIN form completion can be ordered as an add-on service for a low cost. See services and pricing for more details on our fees and packages.
How is a Limited liability Company taxed?
In regards to taxation, the Internal Revenue Service allows the limited liability company to be taxed as a corporation, partnership or a sole proprietorship. This election is made when registering with the Internal Revenue Service. Some states treat the limited liability company differently in regards to taxation, so it is important to understand your state regulations in regard to the taxation of a limited liability company, but most follow the federal election.
Can one person form a Limited Liability Company?
The Internal Revenue Service allows a one member Limited Liability Company for taxation purposes, but some states do not. Check with your state or contact us to find out.
Are there directors and shareholders with a Limited Liability Company?
There are no directors or shareholders with a limited liability company. Its owners are designated as “members”.
What determines the structure of a Limited Liability Company?
The structure of a Limited Liability Company is established in the operating agreement. An operating agreement covers members interests in the company, distributions of profits and losses, contributions made by members and any other items that the members might wish addressed. Speedy will provide a basic operating agreement with your formation, but the agreement is largely generic and does not cover all the specifics the members may wish. Fill-in operating agreements can be purchased over the internet, rather inexpensively, and can be completed after thorough discussion with all the members.
Who manages the Limited Liability Company?
The company can be managed by the members, or the members may select a manager to manage the company for them. The Articles of Organization that is filed with the state addresses the management of the Limited Liability Company. The Speedy order form requires this information.
What are the advantages of a Limited Liability Company?
- First most, as with the corporation, is the liability protection that is offered. A member’s liability is limited by the amount they invested in the company or as specified in the operating agreement.
- Next is the advantage of avoiding double taxation and having the profit or loss pass through to the member. The Limited Liability Company is not taxed itself as it is passed through to the members and only taxed once like the earnings from an S Corporation, Partnership or sole proprietorship.
- Flexibility of management has contributed to the large selection of Limited Liability Companies as the structure of choice.
What are the disadvantages of a Limited Liability Company?
- The life of the Limited Liability Company is not unlimited like a corporation. Different events could occur to dissolve the company.
- With a Limited Liability Company comes strict record keeping requirements and some states require notices to be published upon formation and on a continuing basis for a period of time.
- A Limited Liability Company is still a relatively new structure.
Is an accountant or attorney needed to form a Limited Liability Company?
Absolutely not. Any individual can process the required documents with any state. One should make sure that they are aware of and understand all the requirements of the selected state before forming the limited liability company. If an individual is unsure of, or does not understand the legal or financial ramifications of forming a limited liability company, they should seek the advice of an attorney or accountant. Speedy does not offer any legal or accounting advice in the selection process. Speedy completes the required documents necessary to form a limited liability company avoiding the costly fees.