Should I consider an LLC?

What is a Limited Liability Company?

In Massachusetts, a Limited Liability Company (“LLC”) is governed under Massachusetts General Laws Chapter 156C, also known as The Limited Liability Company Act. By definition, an LLC is an unincorporated association that provides limited liability to its members.

What are some of the benefits of an LLC?

The greatest benefit of an LLC is personal protection from the operations of the business which includes debts, obligations, liabilities and lawsuits. Through formalizing an LLC and establishing an operating agreement, a business is able to document the relationship of the members and create a gameplan. Members can manage and control the business without increasing their own personal exposure to liability. Additionally, by forming an LLC, you are able to create and build a formal brand with a registered business name.

What are some of the challenges associated with an LLC?

There are costs associated with establishing an LLC and a yearly filing fee required by the Commonwealth. An LLC does not automatically offer tax advantages and it is highly recommended that you should seek a tax professional for a more thorough explanation before establishing an LLC.

Who should consider an LLC?

There are several different scenarios in which you should consider an LLC. As mentioned, the primary benefit of an LLC is asset protection from liabilities. You should consider an LLC if you own rental property or if you are in a partnership. While an LLC does not necessarily save a business in terms of taxation, after consulting a tax professional, an LLC can be taxed as an S or C corporation.

If you are considering an LLC, please reach out to schedule an appointment with an attorney on our staff to discuss your options.

THIS BLOG ENTRY IS FOR INFORMATIONAL PURPOSES ONLY. THIS BLOG IS NOT INTENDED TO SERVE AS LEGAL ADVICE AND SHOULD NOT BE RELIED ON AS LEGAL ADVICE. THE INFORMATION THAT IS PROVIDED ABOVE MAY OR MAY NOT APPLY TO YOUR INDIVIDUAL SITUATION.