Starting a new company, but need help giving it life? Collins Legal business lawyers breakdown the important things to know about Limited Liability Companies.
Most clients come to our office with a great idea for a business; they just need help creating that business and giving it life. In Tennessee, the first step in creating any business is determining which form of business is the most appropriate. Once this determination has been made, the formation process should be initiated with the TN Secretary of State.
Determining which business formation is best for a company can be a hard decision to make without the right legal counsel. Go with a Limited Liability Company? A Corporation? A Limited Partnership? While there are many to choose from, only one is the right fit.
key Benefits of a Limited Liability Company
Currently, the most common type of business formation in Tennessee is a limited liability company (LLC). Below are the key things to know about LLCs and why they are so popular. LLCs in Tennessee are controlled by the Tennessee Limited Liability Company Act found at T.C.A. 48-201-101 et seq.
- In general, LLCs combine the benefits of a corporation with those of a limited partnership.
- LLC owners liability for the debts and actions of their company are limited, while still getting the tax benefits of a sole-proprietorship.
- In most cases, LLCs protect owners’ personal assets from claims against the business, including lawsuits.
- There can be as few as one member in an LLC or there can be hundreds.
- The initial and annual filing fees are less expensive than the other entities.
While there are many other benefits to forming an LLC, there are also benefits to other entities like partnerships, sole-proprietorships, and corporations. Consulting with your attorney and CPA about which formation best fits your company is an important step in the decision-making process.
MORE
RESOURCES
FOR
new businesses
→ ENTREPRENEUR: Why the South Is Emerging as the Next Promising Growth and Innovation Hub
→ LAUNCHTN: A public-private partnership that supports entrepreneurs from ideation to exit.
→ NASHVILLE ENTREPRENEUR CENTER:The EC is a Nashville based nonprofit organization on a mission to connect entrepreneurs with critical resources to create, launch and grow businesses.
