Nolo's Guide to Single-Member LLCs: How to Form and Run Your Single-Member Limited Liability Company PDF
Preview Nolo's Guide to Single-Member LLCs: How to Form and Run Your Single-Member Limited Liability Company
“In Nolo you can trust.” NEW YORK TIMES 2ND EDITION Nolo’s Guide to Single-Member LLCs How to Form & Run Your Single-Member Limited Liability Company Attorney David M. Steingold Free Legal Updates at Nolo.com Download Forms on Nolo.com You can download the forms in this book at: www.nolo.com/back-of-book/SMLLC.html We’ll also post updates whenever there’s an important change to the law affecting this book—as well as articles and other related materials. More Resources from Nolo.com Legal Forms, Books, & Software Hundreds of do-it-yourself products—all written in plain English, approved, and updated by our in-house legal editors. Legal Articles Get informed with thousands of free articles on everyday legal topics. Our articles are accurate, up to date, and reader friendly. Find a Lawyer Want to talk to a lawyer? Use Nolo to find a lawyer who can help you with your case. Th e Trusted Name (but don’t take our word for it) “ In Nolo you can trust.” THE NEW YORK TIMES “ Nolo is always there in a jam as the nation’s premier publisher of do-it-yourself legal books.” NEWSWEEK “ Nolo publications…guide people simply through the how, when, where and why of the law.” THE WASHINGTON POST “ [Nolo’s]…material is developed by experienced attorneys who have a knack for making complicated material accessible.” LIBRARY JOURNAL “ When it comes to self-help legal stuff , nobody does a better job than Nolo…” USA TODAY “ Th e most prominent U.S. publisher of self-help legal aids.” TIME MAGAZINE “ Nolo is a pioneer in both consumer and business self-help books and software.” LOS ANGELES TIMES 2nd Edition Nolo’s Guide to Single-Member LLCs How to Form and Run Your Single-Member Limited Liability Company Attorney David M. Steingold LAW for ALL 2ND EDITION OCTOBER 2019 Book & Cover Design SUSAN PUTNEY Proofreading ROBERT WELLS Index SONGBIRD INDEXING SERVICES Printing BANG PRINTING Names: Steingold, David M., author. Title: Nolo’s guide to single-member LLCs : how to form and run your single-member limited liability company / Attorney David M. Steingold. Description: Second edition. | Berkeley, California : Nolo, 2019. | Includes index. | Identifiers: LCCN 2019017901 (print) | LCCN 2019020101 (ebook) | ISBN 9781413326963 (ebook) | ISBN 9781413326956 (pbk.) Subjects: LCSH: One-person corporations--United States--Popular works. | Sole proprietorship--United States--Popular works. | Private companies--United States--Popular works. | One-person corporations--United States--Management--Popular works. | Sole proprietorship--United States--Management--Popular works. | Private companies--United States--Management--Popular works. Classification: LCC KF1380 (ebook) | LCC KF1380 .S74 2019 (print) | DDC 346.73/0668--dc23 LC record available at https://lccn.loc.gov/2019017901 This book covers only United States law, unless it specifically states otherwise. Copyright © 2016, 2019 by Nolo. All rights reserved. The NOLO trademark is registered in the U.S. Patent and Trademark Office. Printed in the U.S.A. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise without prior written permission. Reproduction prohibitions do not apply to the forms contained in this product when reproduced for personal use. For information on bulk purchases or corporate premium sales, please contact the Special Sales Department. Call 800-955-4775 or write to Nolo, 950 Parker Street, Berkeley, California 94710. Please note We believe accurate, plain-English legal information should help you solve many of your own legal problems. But this text is not a substitute for personalized advice from a knowledgeable lawyer. If you want the help of a trained professional—and we’ll always point out situations in which we think that’s a good idea—consult an attorney licensed to practice in your state. About the Author David M. Steingold is a private attorney currently based in Michigan. His practice covers multiple areas including business law. He has been an author for Nolo since 2012. Table of Contents Introduction: Your Single-Member LLC Guide ...............................................1 1 LLCs and Business Structure Basics ...........................................................................3 Why an LLC? .................................................................................................................................4 Protection From Personal Liability ..................................................................................6 The “Novelty” of Single-Member LLCs ..........................................................................9 Business Structures and Personal Liability .................................................................11 2 Taxation of SMLLCs ................................................................................................................17 Default Pass-Through Tax Treatment...........................................................................18 Electing Corporation Tax Treatment............................................................................25 Electing S Corporation Tax Status .................................................................................28 State Income and Franchise Taxes .................................................................................30 Employer Taxes .........................................................................................................................31 Sales and Excise Taxes ...........................................................................................................37 LLCs Owned by Spouses in Community Property States .................................39 3 Forming Your SMLLC: An Overview .......................................................................41 Can I Form a Single-Member LLC?.................................................................................42 Naming Your SMLLC .............................................................................................................43 Managing Your SMLLC .........................................................................................................45 Articles of Organization ......................................................................................................50 The Operating Agreement .................................................................................................55 Getting an Employer Identification Number ...........................................................57 Professional Limited Liability Companies (PLLCs) .................................................58 Additional Resources ............................................................................................................62 4 Financing, Conversion, and Dissolution .............................................................65 Capital Contributions and Capital Interest .............................................................66 Distributions ..............................................................................................................................69 Converting a Preexisting Business to an SMLLC .....................................................70 Dissolving and Winding Up Your SMLLC ...................................................................75 5 Liability Concerns for SMLLCs ....................................................................................79 Piercing the Limited Liability Company Veil ............................................................81 Distinguishing Yourself From the Business ..............................................................82 Fraud or Injustice.....................................................................................................................88 Are SMLLC Assets Protected From Personal Creditors? ....................................89 6 Running Your SMLLC: Additional Tasks .............................................................95 Establishing a Business Bank Account .........................................................................96 Filing Annual Reports ...........................................................................................................97 Paying State LLC Taxes .........................................................................................................99 Business Permits and Licenses .......................................................................................100 Fictitious or Assumed Name (DBA) Certificates ................................................103 Trademarks and Service Marks .....................................................................................104 Liability Insurance ................................................................................................................105 Doing Business in Other States ....................................................................................110 Employees .................................................................................................................................112 7 Financial Record Keeping and Written Resolutions .............................115 Financial Record Keeping .................................................................................................116 Other Records ........................................................................................................................123 SMLLC Meetings and Resolutions ...............................................................................125 Why Keep Good Records? ...............................................................................................128 Appendixes A Sample Operating Agreement for a California Single-Member Limited Liability Company (Manager-Managed) ...........................................................................................................131 1. Preliminary Provisions ................................................................................................133 2. Management Provisions ............................................................................................134 3. Membership Provisions .............................................................................................136 4. Tax and Financial Provisions ...................................................................................138 5. Capital Provisions .........................................................................................................139 6. Dissolution Provisions ................................................................................................140 7. General Provisions ........................................................................................................141 8. Signatures of Members and Spouses of Members .....................................143 B Resolutions for a Single-Member LLC ................................................................145 Written Consent for Sole Member to Open a Bank Account and Borrow Money ......................................................................................................147 Written Consent Granting Authority to Sole Member to Purchase Real Estate ..............................................................................................149 Written Consent of Sole Member Granting Authority to Another Person .........................................................................................................151 Written Consent of Sole Member Rescinding Authority ...............................153 Written Consent of Sole Member Delegating Authority to Rent Business Space ...............................................................................................155 C Using the Downloadable Forms on the Nolo Website .......................157 Editing RTFs .............................................................................................................................158 List of Forms Available on the Nolo Website ........................................................159 Index ..........................................................................................................................................................161
The list of books you might like
