You have many options when it comes to choosing what kind of structure you want your business to have. When protecting your assets is high priority, forming a limited liability company (LLC) can allow you to do so quickly and efficiently. The LLC route is a great option when you want to separate your business and personal assets formally but do not want to go public or take on outside investors.
Many kinds of businesses choose to be LLCs. There are many risks and potential legal entanglements involved when you start a business. An experienced business attorney at Begum Peláez-Prada PLLC could clarify and assist you with many important details. As you plan your business’ future, contact a San Antonio limited liability company (LLC) formation lawyer—it is a great first step.
An LLC is a unique corporate entity that can use its own tax identification number, possess a bank account, and conduct business under its own name. An LLC is essentially a mixture of a corporation and a partnership. Similar to a corporation, an LLC limits the legal liabilities of its owners, called “members,” and like a partnership, an LLC allows individual members to be taxed only once on the LLC’s profits—as personal income—unless they choose to be taxed as a corporation or S-corporation.
LLCs have a more flexible structure than other business entities, so having a strong company agreement is important. An LLC’s company agreement defines member duties, how voting on big and small decisions will occur, operational procedures, and other important business and legal frameworks. While any facet of the business can be included in a company agreement, many LLCs do not have one, and that is a huge mistake.
Consulting with a knowledgeable San Antonio lawyer such as Sasha Begum is important since our attorneys know the options and obstacles that exist not only during the formation of your LLC but also as your business grows.
Founding your business as an LLC comes with many advantages, including that there is no “double taxation.” That means that profits are only taxed at the individual level, not the company level; so profits disbursed to members are not taxed more than once.
Another advantage is that establishing an LLC does not require as much complicated paperwork as other business entities, and since being an LLC in good legal standing requires less mandatory compliance, owners typically file less paperwork. LLCs can also be easily customized with a well-written company agreement. One of our skilled LLC formation lawyers in San Antonio could help you structure your business in the most advantageous way possible.
The LLC structure does come with some disadvantages. LLCs are less appealing to investors: most investors prefer to invest in a C corporation—or C Corp—which has a predictable structure and can easily issue stock. Since LLCs cannot issue stock, becoming a member is typically a more elaborate process, and an LLC may not be the best choice for someone who eventually wants their business to go public or who is seeking outside investors. Furthermore, even though LLC members are not subject to double taxation, they may be responsible for individual, higher self-employment taxes.
An attorney at Begum Peláez-Prada PLLC, such as Sasha Begum, is well acquainted with the intricacies of LLCs and could help you decide whether an LLC is the right structure for your business.
At Begum Peláez-Prada PLLC, we have significant experience helping people like you successfully set up and maintain their LLCs. We are ready to be your trusted advisers as you focus on securing your business’ success. Do not risk your company’s growth by not knowing the law. Contact us today to discuss your options with a San Antonio limited liability company (LLC) formation lawyer.