Email: msmithlawoffice
@yahoo.com

Michele A. Smith Law Office, L.L.C.

Corporate Law and Business Development

If you are considering starting a business, or already own your own business, forming a corporation or LLC can provide you with the personal financial protection that you need.  Additionally, incorporating promotes a professional image and tells potential customers that you are a legitimate business. 

Our office will provide you with professional legal advise and the correct documentation necessary to appropriately form a corporation or LLC to ensure your protection since just filing paperwork for incorporating a business doesn’t automatically mean you won’t have personal liability.   Our office will guide you through the necessary steps in properly forming and maintaining a coporation or LLC,  such as not co-mingling  your personal and business funds and mainintaing proper documents,  to ensure you are successful in protecting your personal assets.

There are many websites that offer canned forms for completion but they are generalized for anyone who visits the website and does not provide you with the personal touch you need to ensure you are properly and fully protected. Don’t leave the protection of your business and personal assets to boilerplate documents that do not tend to your needs, contact our office at 419-502-2002 for professional legal representation. 

Benefits of Forming a Limited Liability Company (LLC)

A limited liability company (“LLC”) is often an attractive business structure option for smaller businesses, as it combines the protection from personal liability of corporations with the tax benefits of a partnership or sole proprietorship.  Furthermore, the ongoing paperwork involved in operating an LLC tends to be easier than other types of business structures.

One of the most important features of an LLC is the ability to limit your personal liability for debts incurred by the business.  As the owner of a sole proprietorship you will be personally liable for any debts that the business cannot pay.  That means that a creditor can reach your personal assets – including your home, car, or other possessions – in order to pay off your business debts.  An LLC, on the other hand, limits the payment of business debts to your business assets.  If the business has no assets from which to pay its debts, then you need not worry about personal liability for the debts in most cases.  In this situation, your only loss would be whatever money or assets you originally invested into the LLC.

There are a few circumstances, however, in which you might be personally liable for the debts of your LLC.  For instance, if you injure someone, personally guarantee a loan or debt for the LLC, fail to pay withholding taxes, or intentionally commit an illegal or fraudulent act, you might end up being personally liable for your business debts, just as if you owned a sole proprietorship or participated in a partnership.

Another major advantage to choosing an LLC for your business structure is its tax treatment.  Rather than being a separate entity for tax purposes, an LLC is categorized as a “pass-through” entity by the Internal Revenue Service (“IRS”), which means that it is taxed just like a sole proprietorship or partnership.  Any business income and/or loss as a result of your ownership in the LLC passes through to your individual income tax return.  You will have to pay quarterly estimated tax payments to the IRS, but you will simply report business income and/or losses on your personal tax return, as opposed to a corporation, which must file a separate income tax return as a completely separate entity.

 Whether your business would benefit from an LLC structure, as opposed to other types of business structures that are available, is best judged by an experienced small business attorney.  Our office will be able to evaluate your situation and advise you on the type of business structure that will best meet your needs.