LLC Business Structure

A limited liability company (LLC) is a popular business structure because it combines the liability protection offered by incorporation while retaining some of the tax advantages of a partnership or sole proprietorship. They are relatively easy to form and tax obligations (at the Federal level) flow through to the owners (members) and are paid as personal taxes (instead of corporate). Learn the basics of LLC, limited liability company structure and let this guide your decision to company business formation in Wyoming.

Form an LLC online or Call us to place your order by phone: Toll-Free 1-877-239-2608

A Limited Liability Company (LLC) is quite often the best choice for a business. The LLC offers simplicity, flexibility and limited personal liability from business creditors.

• Number of owners. An LLC may have one or more owners.
• Less costly creation and maintenance. Formally created under State of Wyoming law, an LLC is less costly than a corporation to create and maintain. Relaxed and less burdensome rules governing operation compared to a corporation.
• Less liability exposure. All of the owners have limited liability for the business's debts. Plus, the business interests of the owners of an LLC are protected from the claims of the owners' personal creditors. This advantage is not enjoyed by a corporation or a Limited Liability Partnership (LLP).
• Tax consequences. An LLC, by default, is treated like a partnership for federal tax purposes and is not a separately taxed entity. Income is reported on the owner's personal tax returns and does not require the filing of a separate tax return when there is only one owner. A multi-member LLC can elect to be taxed as a corporation, which would require a separate tax return.

Single member LLC vs. multiple member LLC

The single member LLC business structure emerged in the 1990s. Over time, it has become recognized in all States. As the name implies, a single member LLC has a single owner. Because income from an single member LLC isn't divided in the same way as it is for a partnership or a multiple member LLC, there are no separate taxes to file with the IRS. The IRS treats a single member LLC just like a sole proprietorship.

Member managed LLC vs. manager-managed LLC

A member managed LLC is run by the owners of the company. This is the typical structure. Another structure, the manager-managed type, which, as the name implies, has a separate manager responsible for daily operations.

The managers are named in the operating agreement, which all owners sign. Manager-managed LLCs set out certain rights and responsibilities for the named managers that can differ from other owners. A manager is usually one of the owners of the LLC. Mangers usually have voting rights and the ability to negotiate loans or handle other business operational and financial tasks. Non-managing members are still owners, but they most often removed from the direct operations of the business.

This often works quite well if an LLC is started with investors who, by their nature (family members or silent partners) would prefer to reap the rewards of their investment without being directly involved. Another advantage of the member-managed structure is that the LLC is more easily identified as a business separate from the owners and recognized as a legal entity by a court in the event of a lawsuit.

Domestic LLC vs. Foreign LLC

Domestic and foreign in this context refers to the State where the LLC is created. A company which is registered in Nevada and which does business in Nevada is operating as a domestic LLC. If the same company is doing business in Oregon (has a physical presence), it is operating as a foreign LLC in the other State (Oregon).

This commonly comes up when LLCs are created in States with business-friendly tax laws but does business in their home State. It may also occur when a business starts expanding into other States. A foreign LLC is required to register with the Secretary of State in the foreign State. The LLC certificate of good standing issued by the home State will be needed. To register your out of state company to transact business in Wyoming, you'll need to file a Certificate of Authority.

The purpose of registering is to meet regulatory and tax requirements of the foreign State.

How do you know if you're operating in a State?

Are you:

• Selling products or services in that State through some party directly tied to the LLC (a distributor or rep).
• Owning property (real estate or a fleet of trucks or example) in the State.
• Having offices or facilities in the State.
• Having a bank account in that State.

Our fees for forming an LLC start at $275. including state filing fees

This is substantially lower than what an attorney might charge for the same service. Registered Agents of Wyoming LLC and it's experienced staff of business formation specialists are ready to make your LLC formation FAST, RELIABLE, AFFORDABLE and is backed by a 30 Day Money Back Guarantee.

Form an LLC online or Call us to place your order by phone: Toll-Free 1-877-239-2608

Got questions?

Email us at agents@mywyomingllc.com or call toll free today (877) 239-2608