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 Maryland legislature enacted laws authorizing its formation, the modern LLC has become more and more popular.
Can My Business Be Formed as an LLC?
Businesses in Maryland can organize using whatever form they choose. The office of the Secretary of State is the organization that accepts filings by those who want to open LLC's. Fees are generally charged for opening LLC's, however, and Maryland law determines the costs for creating LLC's. These laws should certainly help you decide whether to organize as an LLC. The business structure that is appropriate for your business may take some effort to find, but finding the right business form can reward you with increased profitability.
Can I Change the Form of My Business to an LLC?
Under certain conditions, a business in Baltimore may change its form. Eligibility for conversion to a LLC is determined by Maryland law.
How Can an Attorney Help?
Attorneys experienced in Maryland business law can give you valuable input on whether your business would be more profitable as a LLC.