Our business law attorneys have assisted our clients with choice of entity to reach their business, asset protection or tax goals. They have formed hundreds of Arizona entities being mindful of the client's goals.
Several factors may influence this choice. There are other tax and non-tax issues to consider, such as self-employment tax liability, potential taxes if entities are combined and whether there is any plan to "go public" in the future. Decisions may have unintended consequences and require thoughtful consideration. Our business law attorneys assist clients in reviewing plans to make the optimal choice for reaching both personal and business goals.
A limited liability company or LLC, as it is commonly referred to, is an entity in which the members generally have limited personal liability for company obligations. Members are the owners of the LLC; similar to shareholders in a corporation or partners in a partnership. Managers and members of an LLC generally are not liable for the LLC's obligations solely by reason of being managers or members. There is single-member, multiple member and member managed LLCs. Our business law attorneys have formed hundreds of Arizona limited liability companies and understand the nuances of LLC creation.
A corporation is an entity in which the shareholders have limited personal liability for corporate obligations. The shareholders are the owners of the corporation. At annual meetings, shareholders elect directors, who manage the corporation, elect and authorize officers to carry out corporate policies. Shareholders are generally not liable for corporation's obligations; however, there are circumstances where the corporate veil of limited liability may be "pierced" and the shareholders held liable for corporate obligations. The corporation is a separate taxpaying entity. Jaburg Wilk business law attorneys have extensive experience assisting clients with corporate formation.
There are four types of partnerships - general partnerships, limited partnerships, limited liability partnerships and limited liability limited partnerships. A general partnership is created by an agreement between persons to carry on business together for a profit. In general partnerships and limited liability partnerships, each partner has the authority to bind the partnership. With limited partnerships and limited liability limited partnerships, however, there are two classes of partners - general and limited - with only the general partners having the authority to bind the partnership. Profits and losses in a partnership, regardless of type, are allocated to partners based upon their partnership percentage or in accordance with the partnership agreement. Personal liability of the partners for the obligations of the partnership varies depending upon the type of partnership.