LIMITED LIABILITY COMPANY FORMATION

What Is A Limited Liability Company?

A limited liability company (LLC) is a business structure allowed by state statute and created by filing a certificate of formation with the Texas Secretary of State.  Each state may use different regulations.  You should check with your state if you are interested in starting a limited liability company.  Advantages of a limited liability company include i) there is no restriction on the number of members who can participate, and all taxation is passed through to its members; and ii) a limited liability company is not required to establish or maintain the same types of business records as a corporation (e.g., minutes, notes or other records). If you need help Choosing between a Texas Member Managed or Manager Managed LLC you can find additional information by clicking the link!

Does A Limited Liability Company Protect My Personal Assets?

In Texas, a limited liability company that meets state regulations may also protect the members (owners) from personal liability in the event the limited liability company is ever sued.  This means that even if the limited liability company is liable to a creditor or other oblige, the personal assets of the members of the limited liability company are not subject to attachment or levy unless the member has signed a written guarantee to be personally liable.  When you work with our lawyers, you can be assured you will receive direct legal counsel from a well-versed lawyer in business, limited liability company formation, and commercial law. 

What Are the Advantages & Disadvantages Of A Limited Liability Company? 

When beginning a business, you must decide what form of business entity to establish. Some of the most common business forms include the sole proprietorship, partnership, limited liability company, and corporation. It starts with choosing a name for your company and filing an organizational document listing officers, appointing agents, setting up corporate records, creating bylaws or operation agreements, appointing directors, and even issuing stock or membership interests, depending on your choice of entity.  A limited liability company has certain advantages over other types of entities, such as:

• LLCs offer limited liability protection to their owners

• LLCs offer fewer corporate formalities
  

• LLCs offer tax advantages to avoid double taxation

• LLCs offer liability protection to all members

• LLCs can be managed without formal structure
  

• LLC profit distributions do not have to be equal

Dallas Corporate Formation Lawyers

At Wilson Legal Group, our Dallas business lawyers can assist you in forming and maintaining a limited liability company or other corporate forms. 

Additional Business Focus 

How Do I Choose The Proper Entity Type for My Business?

When beginning a business, you must decide what form of business entity to establish. The most common business forms are sole proprietorship, partnership, limited liability company, and corporation. It starts with choosing a name for your company and filing an organizational document listing officers, appointing agents, setting up corporate records, creating bylaws or operation agreements, appointing directors, and even issuing stock or membership interests, depending on which you choose. There are also tax and liability laws, insurance requirements, copyright and trademark laws, and more that will affect your name and entity choices. Our business lawyers are trained in these complexities and can assist you in making your business dreams come true. If you need help Choosing between a Texas Member Managed or Manager Managed LLC you can find additional information by clicking the link!

What Is The Difference Between LLP and LLC?



Limited Liability Companies (LLCs) and Limited Liability Partnerships (LLPs) combine aspects of corporations and partnerships; however, they have different management requirements, liability protections, liability insurance obligations, and tax benefits which may vary from state to state. LLCs are either member-managed or manager-managed. LLPs are similar to a general business partnership, and each partner can manage all or specific duties as agreed by the partners. As for liability, LLP partners are only personally liable for their own negligence and not liable for another partner’s mistakes; however, an LLC member is generally only responsible for up to their initial investment in the LLC. Importantly, LLCs and LLPs are not recognized as business entities by the Internal Revenue Service (IRS). Therefore, all taxes flow through to individual partners according to their ownership interests through a Schedule K-1. Schedule K-1 is an Internal Revenue Service (IRS) tax form issued annually to invest in partnership interests. The purpose of Schedule K-1 is to report each partner's share of the partnership's earnings, losses, deductions, and credits. You must be certain to check your state-specific law before forming an LLC or LLP.