Ch.17 Limited Liability

Limited Liability Companies:

Company with simple management structure

LLC advantages

Simple taxation, limited liability and taxation

Disadvantages of LLC

Laws vary from state to state

Operating Agreement

The most important document for an LLC

LLC are

Fairly new; invented in 1970

Limited Liability Partnerships

were invented to help groups of professionals like lawyers doctors veterenians accountant to give them business association

Limited partnership

Is old

Limited partners

Investors; by law they can’t be part of management

General Partners

Take part in management; have no limitations of liability

Types of

• members managed

• Manager managed

Members Managed

All members/owners participate in the decision making of the company

Manager Managed

only managers are authorized to make management decisions, enter into deals, and bind the LLC to contracts.