Friday, July 27, 2012
Texas LLC - Limited Liability Company: A Texas limited liability company is created by filing a certificate of formation with the Texas Secretary of State. See Texas Business Organizations Code 3.005.
The limited liability company (LLC) is not a partnership or a corporation but rather is a distinct type of entity that has the powers of both a corporation and a partnership.
The owners of an LLC are called “members.” A member can be an individual, partnership, corporation, trust, and any other legal or commercial entity. Generally, the liability of the members is limited to their investment and they may enjoy the pass-through tax treatment afforded to partners in a partnership. As a result of federal tax classification rules, an LLC can achieve both structural flexibility and favorable tax treatment. Nevertheless, persons contemplating forming an LLC are well advised to consult competent legal counsel and tax advisor.
A limited liability company can be managed by managers or by its members. The management structure must be stated in the certificate of formation. Management structure is a determination that is made by the LLC and its members.
Forming a Texas LLC - General Checklist Questions for formation:
1. Will the company be governed by its Members or its Managers?
2. What is the proposed name for the LLC? It is best to provide your preferred name and two
alternatives. Limited Liability Company LLC names must include the words “limited liability
company” or “limited company” or an abbreviation such as “LLC”.
3. What is the purpose of the LLC? Most LLCs that I assist in formation are formed for “any lawful purpose”.
4. Who will be the Registered Agent for the LLC and what will be the registered office street
address for the LLC?
5. Who are the initial Managers or Members of the LLC and what are their complete addresses?
6. Are there any special clauses that need to be added to the Certificate of Formation?
7. Will the LLC need corporate books and/or Membership interest certifcates?
8. When will be the Organizational Meeting for the LLC?
9. Who will be the Organizational Meeting chair person?
10. Will the LLC have officers such as President, Vice-President, Secretary, Treasurer?
11. What are the units of membership interest (ownership) issued to each of the initial Members?
12. Does the LLC have a banking resolution?
13. How will the members vote on future issues arising with the LLC?
Contact Business Formation Lawyer – Business Formation Attorney Thomas P. Finley, Jr. to request a consultation for forming your Limited Liability Company LLC.