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?
A business in New Jersey can be organized using the form that it chooses. If the founders want to organize as an LLC, all that is required is filing the appropriate form with the Secretary of State. However, there may be an additional fee required for forming your LLC, determined by New Jersey laws that govern the formation and actions of 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?
Businesses in Washington may sometimes change form. A company is eligible for conversion to an LLC if its situation falls under circumstances that are detailed by New Jersey law.
How Can an Attorney Help?
Attorneys practicing business law in New Jersey can advise you on whether it would be favorable for your business to form or convert to a LLC.