LLCs

Steve Scott

Attorney at Law

Serving Landlords, Individuals
and Small Businesses

Vanessa Reynolds

Legal Assistant

LLCs

A limited liability company (LLC) is a relatively new form of business organization allowed in Missouri.

In concept, an LLC functions much like a partnership, but it has most of the advantages of a corporation in terms of limiting the individual liability of its owners for business obligations.

An LLC is formed by filing Articles of Organization with the Secretary of State. The owners of the LLC, who are called members, manage the company unless they agree in the Articles of Organization to provide for centralized management by a manager.

Some advantages of an LLC as compared with a corporation are:

	Many of the on-going formalities required in a corporation are not required of an LLC.
	An LLC is treated much like a partnership for tax purposes, whereas a corporation must make a special Subchapter S election to achieve similar tax treatment. An LLC does not pay tax itself, but reports its income (or loss) on an informational tax return which also allocates the income or loss to the owners. The owners then report the income or loss on their personal tax returns.

Some disadvantages of LLCs as compared with corporations are:

An LLC is more expensive to set up initially. This is because the higher degree of flexibility in organizing an LLC requires a more complicated organizational document which must be tailored to meet the organizers’ particular desires.

Because LLCs are a relatively new phenomenon, there are many unresolved questions about how particular legal issues will be resolved by the courts when they arise through litigation. In particular, there are lingering questions about how much individual liability insulation an LLC gives to its owners. In contrast, most such questions about corporations have already been answered through many years of court decisions.

Scott Law Firm organizes LLCs and provides continuing legal representation for them. Flat fees are charged for simple LLCs. For more complicated LLCs, charges are based on hourly rates.

[ Home ] [ Up ]

Inquiries about legal representation and comments about this web site may be emailed to sscott@scottlawfirm.com. We will endeavor to respond promptly but will not provide specific legal advice by email except to established clients. Please see our Notices and Disclaimers. Except as otherwise noted on particular pages, this entire web site is Copyright © 1998-2007 by Scott Law Firm Professional Corporation, Columbia, Missouri, U.S.A. Except as otherwise authorized with respect to landlord forms, site visitors may reproduce materials on this site for personal use only. All copies of copyrighted pages must include our copyright notice.