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Your Nevada Incorporation Attorney Talks About the Reasons for an LLC Formation

man in buildingWhen you work with a Nevada incorporation attorney to decide what the most appropriate legal entity structure may be for your new business, they may recommend you consider a Nevada LLC formation. There are several reasons why an LLC may be the best option for your business among the available entity structure options.

Not Being Taxed Twice

Since LLCs are taxed in the same way that sole proprietorships are taxed, they can help you to avoid being taxed twice. Double taxation may occur with entities such as a C-corporation, because both your corporation and you will each be taxed by the IRS. An LLC can support several classes of stock, and they may be converted later if you need to change it to a corporation.

Choosing the Location for Your LLC

One nice benefit about an LLC is you can choose the state in which you want to form it. Nevada is known for its business-friendly laws, leading many entrepreneurs to choose a Nevada LLC formation, even if the owners live in different states. There are costs associated with setting up an LLC in any state, and your attorney will be able to advise you about them. While Nevada doesn’t tax LLC profits and does not have an income tax or report to the IRS, you should be aware that you will still need to pay taxes in the state in which you reside if you do not live in Nevada. The IRS is able to track profits you make from a Nevada LLC through such things as bank statements, business records, mail and credit cards in your business’s name.

Benefits of Choosing Nevada for Your LLC

Nevada has a reputation for being a business-friendly state, and with good reason. As mentioned previously, the state does not have state income tax and does not tax LLC or corporate profits. The owners of a Nevada LLC or shareholders of a Nevada corporation are also allowed to remain anonymous. In some states, anonymity is not allowed and the identities of owners and shareholders are instead matters of public record. The state also does not have a franchise tax. LLCs are allowed to issue stock for real estate, personal property, services or capital in Nevada. While a majority of states have an information-sharing agreement with the IRS, Nevada does not. There are also strong privacy protection laws in place, helping Nevada business owners to limit their exposure to potential lawsuits. While an experienced plaintiff’s lawyer will still be able to uncover the identity of a Nevada owner of an LLC, it is very hard, time-consuming and expensive for them to do so, making a lawsuit less likely.

Changes Are Easy to Make

After you have set up your LLC, you may need to make changes to it later. It is easy to make the changes you need to your LLC. For example, you may want to add a partner or sell an interest in your company. Unlike a C-corporation, minutes and board meetings are not required to make such decisions. In general, LLCs have far fewer documentary requirements than do C-corporations. Protecting Your Assets An LLC provides important protections to its owners. The structure prevents creditors of your business from going after your personal assets to satisfy debts or lawsuit judgments. If you instead run your business as a sole proprietorship, you will not enjoy this protection from liability. After your company grows and expands, you may later then choose to convert it to an S-corporation or a C-corporation. An LLC, however, offers enough protection from liability when you are first starting and growing your business.

Ease of Registration

LLCs are very easy to set up and register. They generally require filing required paperwork with the Secretary of State and paying the filing and registration fees. After you have set up your LLC, you are then able to apply for and receive your Employer Identification Number, or EIN, from the Internal Revenue Service. Getting your EIN allows you to then open business accounts and checks. The LLC’s manager may then form contracts acting as the LLC with other businesses and people, and people may transfer their patents to the LLC as well. Since changing the name of an LLC is hard, it is important to be careful when making the initial choice. The name also must be one that is not already registered with the state as another business. Your lawyer may be able to help you with the name selection for your LLC.

Why Getting Legal Advice About Formation Is Important

Even though forming an LLC is a straightforward process, it is still important for you to get professional advice. There are a variety of different types of legal entity structures through which your business can operate. The best legal structure for your business may vary depending on your business type, size and whether you intend to issue stock, among other considerations. Each provides different levels of liability protection. There are also different tax considerations and documentation requirements for the different types of corporate structures. An attorney who practices law in the area of business formation and planning may be able to help you choose the structure that will work best for you.

Contact a Nevada Incorporation Attorney

To schedule a consultation with a Nevada incorporation attorney at the Sutton Law Center, call (775) 824-0300.

Want to Form an LLC in Nevada? Let Us Show You How!

Happy businesswoman on her laptopOur experienced business attorney can help with starting an LLC in Nevada and understanding the fees that accompany it.

How Nevada Businesses Can Benefit from Forming an LLC

How to incorporate in Nevada and the details of an LLC can be confusing issues. Knowing benefits, costs and strategies for forming an LLC are keys to doing so successfully. There are many positives that come from forming an LLC. An LLC can be useful when protecting personal assets. If, for example, your business was ever confronted with a lawsuit, you would not have to worry about your personal assets being taken provided your business is an LLC or a corporation. However, if you operate your business as a sole proprietorship, then your assets will be vulnerable. LLCs are also beneficial in Nevada because you will be able to use the pass-through tax. With this, you will not need to file a separate tax return for the business. The profit and loss will be passed to your personal income tax when you file. An LLC is attractive to business owners because its structure can continue even after the owner’s death. It is transferable to a new owner if the business is sold in Nevada. There are not as many formalities when using an LLC in comparison to trying to incorporate in Nevada.

Calculating the Costs of Forming an LLC

This is one of the most important issues that people think about when considering an LLC. If you handle the paperwork on your own, you will have to pay $75 when it is submitted to the Nevada Secretary of State. It is possible to expedite the paperwork by paying $125. An Initial List must also be filed in Nevada. This must be done on or prior to the last day of the first month after you have filed your LLC paperwork. The LLC paperwork is also known as the Articles of Organization. This contains the names of your officers, directors and the registered agent. It will cost $150 and must be updated annually when the fee must be paid.

Steps to Take in Nevada When Forming an LLC

You will first have to determine whether or not you want to do the paperwork on your own or hire someone to do it. It will cost more if you decide to hire someone, but if you want to make certain it is done correctly and want to save time, it is a sound strategy. After that, you will have to register the company name. You will want to select a name that has not been used by anyone else in the state. The form for Articles of Organization can be acquired from the website of the Nevada Secretary of State. This is relatively simple to complete. Included will be the name of the business, the address, your contact information, the names of the officers, directors and your registered agent. After paying the filing fee, you might have to wait several weeks for the application to be processed. You should think about when you would like your LLC to go into effect. Many decide to apply and schedule the start date for the first day of the new year so accounting can be simplified.

Contact an Attorney About an LLC in Nevada

If you would like to start an LLC in Nevada, call (775) 824-0300 to speak to the Sutton Law Center today.

 

Wyoming LLC Incorporation Details

Wyoming LLCIf you are interested in improving the financial prospects for your company, learning how to incorporate in Wyoming may benefit you. Forming a Wyoming LLC dates back to 1977, when the state enacted the first Limited Liability Company Act in the county. The Act used features of both partnerships and corporations to create a new corporate structure. The IRS would not issue a ruling on LLC classification between 1977 and 1987.

IRS Rulings

Due to the IRS’ refusal to resolve the ambiguity surrounding national and Wyoming LLC status, other states developed similar statutes. The IRS eventually ruled in 1988 that the attributes of the company would determine its tax designation. For example, LLCs with two or more features of a partnership were treated as such, and the same was true for companies with the features of corporations. The company attribute test was eventually eliminated and it was decided that noncorporate entities could self identify for tax purposes.

Characteristics

All LLCs are created through state statute. The Wyoming LLC Act makes it possible to create an LLC or any legal purpose except insurance or banking. The business must abide by multiple statutory requirements of formation as well. It must include a form of the word limited within its name to serve as a designation of the type of entity it is. The business must also exist as a separate entity from its members, shielding them from liability for the business.

Difficulties

By 1997, LLCs were recognized around the nation. Each individual state statute was developed to work within that state’s legislature, which created a high level of diversity around the country. Out-of-state LLC acknowledgment also created legal confusion. In these situations, it is often necessary for matters to be decided on a case-by-case basis.

Changes and Uniformity

In 2000, Wyoming’s State Legislature offered the Close Limited Liability Company statutes. These statutes were designed to be an improvement on the more general Wyoming Limited Liability Company Act, offering greater restrictions. The new legislation also filed in gaps with the original Act without promoting uniformity with laws in other states. In 1996, there was an attempt to address the uniformity issue. The National Conference of Commissioners on Uniform State Laws recommended the adoption of the same law across all states, but it was not successful. The corporate climate had changed significantly throughout the years, and eventually resulted in the Revised Uniform Limited Liability Company Act. This Act was formalized in 2006 and enacted by Wyoming in 2010, repealing its existing act. These changes were made to make LLC law less confusing, especially as members of different LLCs work across state lines. When LLCs from different states work together, it is also necessary to have a standard legislation to reference when issues arise for one or more partners in the LLC. A lawyer may be able too help you determine if an LLC offers the protections your business needs.

Contact Lawyers to Incorporate in Wyoming

Call the Sutton Law Center today at (775) 824-0300 to get help forming your Wyoming LLC.

Manager-Managed LLCs

Forming an LLC in NevadaIf you are an entrepreneur and you want to learn how to form an LLC in California or Nevada, you may also want to learn about naming managers to manage your company who do not have to be included as LLC members. If your LLC will include members who will not take part in day-to-day decision-making for your company, appointing third-party managers may make sense. Members that will function as managers may also be appointed from within the ranks of the LLC members.

Decision-Making Authority

If you decide to form a manager-managed LLC in California or Nevada, only the managing members of your LLC will have decision-making authority about the important aspects of the business. This includes the ability to form contracts and enter into agreements on behalf of the business. Non-managing members of the LLC are still entitled to a portion of the generated profits as outlined in the operating agreement for the company.

Appointing Outside Investors

If you wish, you can appoint an outside investor as a manager who has some say in the company’s business dealings. They can then have a say along with the members who are managers, but they won’t be a member of the LLC itself.

Operating Agreements and Your LLC

If you decide that a manager-managed LLC is right for your company, it is important that you have an operating agreement in place. This agreement should clearly outline the vote that will be necessary among the managing members for the business to act. It should also provide the means by which managers can be removed and replaced. These agreements should also clearly state that members who are managers do not assume personal liability for the decisions that are made for the business. Finally, it is a good idea to include an indemnification provision in the operating agreement, which states that the business will be liable to pay the debts incurred by an individual manager in their business operations.

Self-Employment Taxes and Non-Managing LLC Members

While managing members of LLCs will be required to pay self-employment taxes, non-managing members will not be. For the specific tax implications, non-managing members should consult with a tax law attorney.

Securities Registration Requirements

If you have multiple members and a manager-managed LLC, it is important for you to understand the securities registration laws and the exemptions that may apply. If your non-managing members are investing money in your business, your business may be considered to be a security and thus subject to registration requirements. If these interests will be considered to be securities, it is important for you to seek an exemption from the requirements before any of the original investors invest any money. If all of the owners live in the same state, the Securities and Exchange Commission will exempt the business from registration requirements if all of the sales also occur within the state. Another possible exemption is the private offering federal exemption. In private offerings, investments are not advertised and are limited to 35 or fewer people. The exemption may also apply when the investors are people who have net incomes or assets that make it reasonably likely they will be able to take care of their own investments without the need for intervention. If you find out that you do not meet the exemptions, you must register your business’s sales of interests with the Securities and Exchange Commission as well as with the state in which it is located.

Considerations for Single-Member LLCs

If your company will either be a single-member LLC or one that is owned by you together with your spouse, it is a good idea to draft an operating agreement that appoints you as a member-manager of the company. While there may not be a large day-to-day difference in how a single-member LLC with an appointed manager and without one is run, naming yourself as a manager allows you to detail succession managers in the event you no longer wish to be actively involved in the day-to-day operations and dealings of the business. Your business law attorney may advise you on how to effective draft the operation agreement you will need for your company whether it will be a single-member LLC or one with multiple included members.

Contact an Attorney About How to Form an LLC in Wyoming or Forming an LLC in Nevada

To speak with a lawyer about how to form an LLC in California or forming an LLC in Nevada, call the Sutton Law Center at (775) 824-0300.

Protect and Grow Your Business with My Help

 Reno Corporate Services LawyerIf you own a business and don’t already have a corporation lawyer to turn to for help, it’s time to hire one. Like many business owners, you might think that legal counsel is only needed in specific instances. When it comes to keeping a business running smoothly and within the confines of the law, however, it is crucial to have a Reno corporate services lawyer like myself by your side. Such a professional provides a full array of services and advice that helps you grow your business and keep it running as smoothly as possible. I will work closely with you throughout the fiscal year with a variety of tasks. These include preparing annual state and federal filings and conducting shareholders’ meetings. Corporation attorneys like myself also have extensive contract law experience and can help you draft contracts that suit your needs and protect your interests. To run a successful business, you must maintain relationships with vendors, customers, employees and many others. Along the way, conflicts can and will arise. It is crucial to handle them properly and legally to ensure the ongoing success of your business. I can advise you when issues arise and offer solutions. I will also help you anticipate potential problems and advise you on steps that you can take to keep them from actually occurring. Skilled corporation attorneys understand federal and state laws and can help you understand how they apply to any given business situation that may develop. Their assistance in such matters will help you save untold amounts of time and money, so your business will be better for it. With their help, you can focus on what matters the most: running and expanding your business.

Hire a Reno Corporate Services Lawyer Today

Don’t go without the assistance and counsel of an experienced corporation lawyer for another day. Contact Sutton Law Center at (775) 824-0300 today to start protecting your business.

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