Starting a business may afford you the chance to run things your way, but before launch, you have to develop a solid plan for legal incorporation. A popular classification for new business ventures is the limited liability company or LLC.
While the IRS sets out general guidelines for the difference between business incorporations, Indiana law governs the specifics of incorporating an LLC. Discover some of the basic requirements and benefits this type of company classification may grant to see if your business fits the mold
What does an LLC designation do?
As with other business classifications, an LLC indicates the type of business structure you utilize and how you pay taxes. An LLC requires very little as far as filing. You have the option to incorporate your business in this way under any state’s laws, which may or may not afford you tax advantages. One of the benefits of an LLC is that it keeps your personal finances safe from penalty should your business face a lawsuit or file bankruptcy.
What do you need?
To incorporate an LLC, you need business formation documents. An LLC structure only requires a single member, and there is no maximum. Regardless of the number of members, you need to appoint a designated representative and create articles of organization and an operating agreement. You then need to file these with the state to establish your business.
Who is not eligible for an LLC?
Most businesses are eligible to form LLCs; however, there are exceptions. If you start a bank or insurance company, you may incorporate it as an LLC. The government monitors these businesses differently, and the oversight requires more complex legal formation.
Before opening your doors to the public, you need to get all your foundational elements in place to set yourself up for success.