The LLC, or Limited Liability Company, is a business structure that was invented to offer an array of benefits typically provided by 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 New Jersey legislature enacted laws authorizing its formation, the modern LLC has become more and more popular.
Can My Business Be Formed as an LLC?
In New Jersey, 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 generally charged for opening LLC's, however, and New Jersey 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 Salem may change its form. Eligibility for conversion to a LLC is determined by New Jersey law.
How Can an Attorney Help?
Whether it would be favorable for your business to form or convert to a LLC is a difficult decision. An attorney practicing business law in New Jersey can give you valuable advice.