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BL-Chapt37 - Print Chapter Page 1 of 17 Limited Liability...

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Limited Liability Companies and Special Business Forms Chapter Introduction 37-1 Limited Liability Companies 37-1a Evolution of the LLC 37-1b The Nature of the LLC 37-1c LLC Formation 37-1d Jurisdictional Requirements 37-1e Advantages and Disadvantages of the LLC 37-1f The LLC Operating Agreement 37-2 Management of an LLC 37-2a Participation in Management 37-2b Operating Procedures 37-3 Dissociation and Dissolution of an LLC 37-3a Effect of Dissociation 37-3b Dissolution 37-4 Special Business Forms 37-4a Joint Venture 37-4b Syndicate 37-4c Joint Stock Company 37-4d Business Trust 37-4e Cooperative Chapter Recap Page 1 of 17 Print Chapter 2010-8-30 http://atext.aplia.com/controller/ChapterPrint.aspx?isbn=0324655223&mod=0&ch=37...
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Chapter Introduction In the preceding chapters, we have examined sole proprietorships, partnerships, and several forms of limited partnerships. Before we move on to discuss corporations, one of the most prevalent business forms, we pause to examine a relatively new form of business organization called the limited liability company (LLC) . The LLC is a hybrid form that combines the limited liability aspects of the corporation and the tax advantages of a partnership. Increasingly, LLCs are becoming an organizational form of choice among businesspersons–a trend encouraged by state statutes permitting their use. In this chapter, we begin by examining the LLC. After looking at the LLC form of business in some detail, we describe a number of business forms that can be used for special types of business ventures. Page 2 of 17 Print Chapter 2010-8-30 http://atext.aplia.com/controller/ChapterPrint.aspx?isbn=0324655223&mod=0&ch=37...
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37-1 37-1a Limited Liability Companies Legal Conflicts in Business: Corporation or LLC: Which is Better? What's the best organization method for Wizard Internet? Evolution of the LLC Taxation of the LLC Ask the Instructor Video: LLCs/LLPs: Why would a Limited Liability Company ever choose to be taxed as a corporation, rather than as a partnership? Isn't the main advantage of an LLC the ability to avoid corporate double taxation? Limited liability companies (LLCs) are governed by state LLC statutes. These laws vary, of course, from state to state. In an attempt to create more uniformity among the states in this respect, in 1995 the National Conference of Commissioners on Uniform State Laws issued the Uniform Limited Liability Company Act (ULLCA). To date, fewer than one-fourth of the states have adopted the ULLCA, and thus the law governing LLCs remains far from uniform. Some provisions are common to most state statutes, however, and we base our discussion of LLCs in this section on these common elements. In 1977, Wyoming became the first state to pass legislation authorizing the creation of an LLC. Although LLCs emerged in the United States only in 1977, they have been used for more than a century in other areas, including several European and South American nations. For example, the South American limitada is a form of business organization that operates more or less as a partnership but provides limited liability for the owners.
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