Limited Liability Company (LLC)

Many business owners ask which business structure is better: a corporation or a limited liability company (LLC). The answer is not really to be found with a lawyer, but with an accountant. Whether to go with a corporation or limited liability company really is driven by your tax needs.

From a legal stand point, an limited liability company, like a corporation is designed to protect the owner from lawsuits. Both structures do that job very well.

The big difference is that a limited liability company has different, and more expensive filing requirements. Also, to be properly run, the limited liability company needs to have articles of organization and an operating agreement.

The articles of organization is a detailed document which sets up the structure of the limited liability company and how it is to be run. The operating agreement is generally used when there is more than one member of the limited liability company. This is also a detailed document which sets forth the obligations of the members to each other and to the company. It should also set forth each parties ownership share of the company,how much new members must pay to join, and what happens if the members reach a deadlock.

At Port and Sava, we have experience not just drafting these documents but litigating when the issues when the business relationship sours. Our experience translates into greater protection for you and your business.