The legal business form of the LLC, or Limited Liability Company, offers the benefits of several other traditional business forms. An LLC has the same advantage of limited liability that a corporation does, but without being taxed as its own entity. Instead, it's taxed more similarly to a sole proprietorship or partnership. Like a corporation, a LLC can have unlimited shareholders, called members. But a key difference is if one of these shareholders dies or files for bankruptcy, the LLC is dissolved and will stop operations unless the remaining members form a new LLC. For hundreds of years, limited liability has been a primary goal of some business forms, but since the Massachusetts legislature enacted laws authorizing its formation, the modern LLC has become more and more popular.
Can My Business Be Formed as an LLC?
In Massachusetts, a business can be formed using the form that it chooses. Opening an LLC simply requires that the business founders file a form with the Secretary of State. Fees are often charged for opening LLC's, however, and Massachusetts law determines the costs for creating LLC's. In deciding whether you should organize as an LLC, you should consider carefully the applicable laws. Finding the right business structure for your company can lead to increased profits, but the process may take some time.
Can I Change the Form of My Business to an LLC?
Under specific conditions, a business in Somerville may change its form. Eligibility for conversion to a LLC is determined by Massachusetts law.
How Can an Attorney Help?
A lawyer versed in Massachusetts business law will be able to advise you of the benefits and costs for forming and maintaining a LLC.