what to ask an attorney when extablishing an llc

You should ask your lawyer about the general information required for registration, including how you should structure your fiscal year, if your state requires disclosure of all investors and what other general information your state requires for the actual registration of your LLC.

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Do I need an accountant or tax attorney to form an LLC?

Do I need to sign the form to start an LLC?

What should I do after forming an LLC?

Questions to Ask a Lawyer About LLC Business Name. Before your begin the registration process, you and your lawyer should discuss the potential name for... Registration. You should ask your lawyer about the general information required for registration, including how you... Operating Agreement. You ...

Should I start an LLC or a sole proprietorship?

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What is a limited liability company?

Limited Liability Companies. One of the most common entities created today is the limited liability company or LLC. It is often used because it is considered simple to set up, provides limited liability protection, and is not subject to double-taxation like corporations.

What is an LLC?

One of the most common entities created today is the limited liability company or LLC. It is often used because it is considered simple to set up, provides limited liability protection, and is not subject to double-taxation like corporations. However, jumping into an LLC is not always the best option. The decision to start an LLC should be carefully weighed against your overall objectives with the company, such as whether you want to issue equity to employees or investors, whether you are going for institutional financing, and if you’re going to take your company public.

Is it better to jump into an LLC or a corporation?

However, jumping into an LLC is not always the best option.

Why is it important to meet with a small business attorney?

Meeting with a small business attorney is an important way to get your business off to a good start and minimize future risks. Here are questions to ask at your first meeting. New entrepreneurs have their hands full, making plans, developing products and services, and lining up financing.

What does a business lawyer do?

A business lawyer can explain how to start a business and answer your business law questions. But more importantly, a lawyer can identify the risks you face and help you minimize them. When you meet with your lawyer for the first time, it’s a good idea to have some questions in mind.

What to do before starting a small business?

Before starting a small business, you must decide how your business will be structured. If you do not form a formal business entity, your business will either be a sole proprietorship (with one owner) or a general partnership (with more than one owner). Legally, you and your business will be the same “person,” so if your business has debts ...

What happens if you don't form a business entity?

If you do not form a formal business entity, your business will either be a sole proprietorship (with one owner) or a general partnership (with more than one owner). Legally, you and your business will be the same “person,” so if your business has debts or is sued, you are personally liable for those obligations.

What is a limited partnership?

Other options include a limited partnership, in which some partners are fully liable for business obligations, and others are not, and a nonprofit corporation.

Can you use a name that another business is already using?

Every state has rules about the names that new business entities can use, and in general, you can’t choose a name that another business is already using. Also, it’s risky to choose a name that might infringe on another business’s registered trademark.

What are the federal laws?

Federal laws range from anti-discrimination laws to health and safety regulations to wage and hour laws. You may need policies and procedures, handbooks, and training to ensure that you don’t inadvertently violate them. You must also comply with state laws relating to such things as the minimum wage.

How will an LLC be managed?

10. How will the LLC be managed? LLCs may be managed by their members (like general partnerships) or by one or more managers appointed by their members (either expressly in the operating agreement or by some voting or approval process). If a corporate model is preferable, LLCs may be managed by boards of managers that function like corporate boards of directors. If the LLC will have a board that functions like a corporate board of directors, how many people will be on the board, and how will those people be selected?#N#11. If an LLC has managers, the day to day affairs of the LLC may be managed by the managers or, if a corporate model is preferable, by officers appointed (usually) by the managers. If the LLC will have managers, will it also have officers? If so, what authority will the officers have?#N#12. If the LLC will have managers, what, if any, actions (e.g., issuances of additional interests, mergers, significant asset sales, significant capital expenditures, borrowings) will be subject to the approval of the members? Will particular members have special approval rights? Will particular actions require higher levels of approval than other actions?

When does an LLC dissolve?

Generally, an LLC dissolves if it becomes bankrupt, if a court orders its dissolution or if it has fewer than the number of members that it must have to continue under state law. In addition, the LLC should dissolve by the vote of the managers and/or some quantum of the members. 20.

Why is it important to choose a business name?

Choosing a unique business name is important for both practical and branding purposes. For one, most states won’t allow two businesses to have the same name—it doesn’t matter where they’re located within the state. Some states also prohibit certain words, such as “city,” “insurance” or “bank.”

What is a registered agent for LLC?

A registered agent is someone who receives official or legal documents (such as subpoenas) on behalf of the LLC. Once received, the registered agent will then pass on these documents to the person in charge of the LLC. Anyone over 18 years old can be a registered agent—and there’s nothing wrong with naming yourself. Or, you can designate a company that provides registered agent services to do so. This will come at a fee, of course; pricing for registered agents may cost a few hundred dollars per year.

What is an operating agreement?

An operating agreement contains the details of the financial, legal and management rights of all members of the LLC. More specifically, it can include how profits will be distributed, how members leave the LLC and who contributes capital for the business. In essence, it should contain all relevant information pertaining to the operations of your LLC.

How much does a business attorney cost?

A business attorney can save time and money when business owners create a new business. For around $200 to $5000, they can handle the items you may not have time to consider, such as: 1 Creating an LLC operating agreement that explains the who, what, when, where, why, and how of your company (this is required in some states) 2 Creating articles of organization that list the registered agent, LLC management, and the date of formation 3 Keeping detailed records in case of lawsuits or audits 4 Filing fees and registering with the correct people 5 Registering your business name and checking that the LLC name is available 6 Completing and filing all legal documents

How much does it cost to register an LLC?

Your LLC will give you tax benefits and protect your personal assets if anything happens to your company. It costs between $50-$500 on average to register your business. You do not need an attorney to form an LLC.

Can an LLC be sued?

Once you register, you can buy or rent a building and have company bank accounts. Unfortunately, your company can also be sued.

What is a business lawyer?

Business lawyers if you need to change your business structure to a single-member LLC, S corporation, or another type of business, or need help with another business-related legal matter. General counsel to review compliance with state laws, state agencies, state fees, or annual fees.

Why is understanding the different business structures important?

Understanding the different business structures is crucial for you to decide which one suit you best. Each business type has specific details unique to it that may or may not benefit you depending on the strengths and weaknesses of your prospect business….

Can debt be transferred to owners?

The debts will not be transferred to the owners and your personal assets are safe from the embargo. This, however, needs a ton of paperwork and other things such as regular meetings, filing of annual reports, board of directors to manage the business, and more. In addition to that, double taxation is applied here.

How much does it cost to get an article of organization?

Organize and file the paperwork needed that is referred to as the articles of organization that may cost about $100 to $800 depending on the state.

What is the Revised Uniform Partnership Act?

Many of the states implement the Revised Uniform Partnership Act that prevents the personal creditors of the owners of the LLC from charging an order that will force them to foreclose and liquidate the business. This is a rule that is never experienced even by corporation owners.

What does it mean to be a corporation?

Unlike the first two, a corporation means that your business will exist as another entity of its own that is allowed by the law to earn profit and sell shares. As a result, the owners have a lower level of liability under this structure.

What is LLC in business?

Limited Liability Company (LLC) is somewhat a combination of features and benefits of partnership and corporation. Entrepreneurs who opt for this structure do not need to worry that their personal assets will be in peril if ever the business was not able to meet the financial obligations expected from it.

Is a partnership the same as a sole proprietorship?

The partnership on the other hand is almost the same as the sole proprietorship except for the fact that there are more people involved. The partnership member’s ownership does need to be in the monetary form. You can be a partner even if your contribution to the business is your ability to work as the administrator.

Why is it important to hire a lawyer?

For this reason, it is crucial that you hire a lawyer who can answer most of the questions or concerns that will undoubtedly pop up from time to time. A lawyer who will potentially work with you for the long term.

Is there a confidentiality agreement with a lawyer?

Yes, there is a lawyer-client confidentiality agreement, but it’s better to be safe than sorry. Even if you are certain that your lawyer will never discuss any details regarding your business with a competitor, you might feel uncomfortable sharing that information in the first place.

What type of business has only one owner?

The main types of business structures include a sole proprietorship, which has only one owner, a general partnership, which has two or more owners, or one of the types of entities that allow you to limit the liability that the company itself is responsible for.

Is a sole proprietorship the same as a corporation?

In most cases, as a sole proprietor, you and your business are the same person . This means its debts are your debts, and you are legally liable for them. If you choose to limit this liability, you can choose to be set up as a corporation, limited liability partnership, limited partnership, or a limited liability company.

Do business lawyers charge an annual fee?

A good business lawyer is truly invaluable, and most will allow you to pay an annual fee so that you can contact them anytime you need them. You can ask them questions about employees, paperwork and documentation, risk-management issues, personnel issues, and even concerns about your board members.

Do lawyers save money?

The fact is, most lawyers try to help you save on the fees you’re paying them. Ask your lawyer specifically if there are ways to save money on the legal services he or she provides. If the lawyer is adamantly against offering this option, it could be a red flag.

Do business owners have a full plate?

Business owners have a full plate day in and day out, but your legal concerns will not be insurmountable if you find the right lawyer. Take your time, make a list of questions, and, most of all, be prepared for the questions the lawyer might ask you.

How to incorporate a business?

1. Get Documents and Records in Order. After incorporating a business, you’ll need to prepare bylaws that describe how your new corporation will operate. A few states also require you to publish a newspaper notice of your incorporation.

What documents should be kept in a corporate minute book?

You should set up a corporate minute book and a file or binder where you will keep important corporate documents such as your certificate of incorporation, bylaws, shareholder information and resolutions.

What to do after forming an LLC?

After forming an LLC, you should prepare an operating agreement and set up a file or binder for your important business records. A handful of states require LLCs to publish notice of their formation, and some states also require LLCs to file initial reports. The website of the secretary of state in your state is a good source ...

What is an employer identification number?

An employer identification number, or EIN, is a number that the Internal Revenue Service uses to identify businesses—sort of like the business version of a Social Security number. Most businesses need an EIN, though solo business owners who don’t have employees or pay excise taxes can use their Social Security Number instead.

Why do businesses need a bank account?

A business bank account will help you keep your business finances separate from your personal finances. This makes recordkeeping and tax preparation easier and helps preserve your business’s separate identity.

What is a seller's permit?

A seller’s permit allows you to sell items or services in your state and collect sales tax on those items. It also allows you to buy goods from wholesalers without paying sales tax. Most states require you to obtain a seller’s permit before you make any sales.

What is merchant account?

A merchant account is a special bank account that holds funds from credit and debit card purchases. Once the transaction is approved, the funds are transferred to your regular business bank account.

Contributions and Capital

• 1. What contributions of cash, property or services will each of the owners (who are called “members”) make to the LLC? 2. Will there be any required contributions after the initial ones (e.g., to fund working capital needs)? If so, what penalties will apply if a member fails to make a required contribution when due? 3. Under what circumstances, if...

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Distributions

Governance

Transfers of Interests; Buy/Sell

Termination/Conversion