Incorporation
LLC
California
LLC and corporate governance?
I recently started a small business and am in the process of setting up a Limited Liability Company (LLC). I am interested in understanding the corporate governance structure of an LLC, including the roles and responsibilities of members and managers, the decision-making process, and the procedures for resolving disputes. I want to ensure that I have the most comprehensive understanding of LLCs before I move forward.
Answers from 1 Lawyer
Answer
Incorporation
California
Paul S.
ContractsCounsel verified
Those are good questions, and one of the advantages of an LLC is that you have a great deal of flexibility in structuring its management and governance.
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I am starting a public speaking consulting business with one other person. Most of our work will be done virtually and do not need an office space and will not have a physical product. We do not have investors. We have received conflicting advice about whether to form a llc or an s-corp. The s-corp has been suggested by some as the best for tax purposes, but others have warned that it is much more expensive to start and harder to maintain. What would be best for our situation?
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For a small service business with no outside investors, the LLC form probably offers you more advantages than the corporation. (For example, LLCs offer greater flexibility, fewer corporate formalities, and pass-through taxation which is especially beneficial in the early stages of an LLC if you have other income sources.) The S-Corp election does not affect your choice of entity (LLC or corporation). Either kind of entity can make the S-Corp election, which just tells the IRS how you should be taxed. You can form an LLC at the beginning and make the S-Corp election for that LLC in the future, if and when it makes sense (you will still be an LLC then, but an S-Corp for tax purposes only). The S-Corp election only makes sense to do once your net profits reach a certain level. The purpose of the S-Corp election is to reduce your taxes. Filing the S-Corp election is not itself very expensive, but you will need to incur the costs of running payroll. (LLCs don't have to run payroll.)
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LLC and subsidiary formation?
I am in the process of starting a business and am looking to form a Limited Liability Company (LLC). I plan to have a subsidiary company, and am looking for advice on the best way to structure the LLC and subsidiary. I am also interested in learning what other legal considerations I should be aware of when setting up the LLC.
Gagandeep K.
If you are interested in forming a series LLC (SLLC) in which a group of LLCs are owned in a tiered-down structure such that the top tier LLC owns the lower-tiered LLCs, then you have to from the SLLC in another state. A SLLC cannot be formed in California. You must register with the foreign SLLC with the California Secretary of State (SOS) before they start doing business in California. In California, LLCs can have one or more members. A member can be an entity or an individual. So if you are forming the LLCs in CA, then one LLC can own another LLC. There are various considerations when forming a LLC in California such as filing the appropriate documentation with the CA Secretary of State (e.g., Articles of Organization, Statement of Information), and having an Operating Agreement to govern, among other things, the LLC's business; LLC's management; members' rights, financial obligations and managerial duties; allocation of profits, losses, and distributions; tax implications; admitting new members or transferring interest; dissolution and winding up of the LLC.
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LLC and member liability?
I am interested in forming a limited liability company (LLC) and am seeking legal advice regarding the protection of my assets and the liabilities of the LLC members. I am concerned about the potential risks associated with being a member of an LLC and would like to understand what kind of protection I can expect.
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In general, there are benefits and drawbacks in the LLC structure so it is important to weigh these in deciding if an LLC makes the most sense for your business. Some of the benefits to the LLC structure are limiting personal liability, tax advantages, and flexibility in the structure, among others. There are also some limitations to the LLC structure such as in raising investment and limitation on liability protection. You can learn more about the LLC structure, protections, and risks here https://www.contractscounsel.com/t/g/us/llc/13. For specific questions about an LLC structure as it applies to you business, please consult an attorney.
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I am in the process of forming a Limited Liability Company (LLC) and I am looking to understand how the management structure will be set up post-formation. I have a business partner who will be a co-owner of the LLC and I am interested in learning the best way to ensure that both of our interests are represented in the management structure. Furthermore, I am interested in learning what type of documentation will be needed to ensure that our management structure is properly set up and in compliance with applicable laws.
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What are the key steps and legal requirements for forming a multi-member LLC in the state of California?
I am currently in the process of starting a new business venture with two other partners, and we have decided to form a multi-member LLC in the state of California. However, I am not familiar with the specific steps and legal requirements involved in this process, and I want to ensure that we are following all necessary procedures to establish the LLC correctly and avoid any potential legal issues in the future. I am seeking guidance from a lawyer who can provide clarity on the key steps, documentation, and legal obligations that need to be considered when forming a multi-member LLC in California.
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Hello! Here are the steps: 1. Reserve a name. The state says - For general information about name reservations and name style requirements relating to limited liability companies, please refer to our Name Reservations webpage. 2. Create your Articles of organization. You should also create an operating agreement. We can do this for you. 3. You need an agent for service of process 4. You need to identify manager or member-managed 5. Then you then need to fill out and file form LLC-1. The instructions are listed at this link - https://bpd.cdn.sos.ca.gov/llc/forms/llc-1.pdf Within 90 days of forming a California LLC, you’ll need to file an Initial Statement of Information. This form is free to file You can file this all online by the link - https://www.sos.ca.gov/business-programs/bizfile/file-online Best of luck! Dolan
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