Author Topic: What is LLC?  (Read 1790 times)

ASHDYE

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What is LLC?
« on: April 30, 2013, 07:58:48 PM »
I know LLC stands for Limited Liability Company but I'm confused about how I go about getting it and if I really need it.
p.s I even put it on my business cards already! (MEDICAL CODER, LLC)

PMRNC

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Re: What is LLC?
« Reply #1 on: May 01, 2013, 07:11:38 AM »
A very simple explanation of an LLC is basically that your personal assets are not at risk under the LLC umbrella. You will pay more in taxes but the protection could be worth it.   

Here's How:

    Obtain a copy of your state's LLC Articles of Organization form from your state's Secretary of State office:  http://entrepreneurs.about.com/od/generalresources/a/secretarystate.htm   

When you contact them, also find out if the state in which you are incorporating requires you to post a notice in the newspaper. Also find out any specific rules regarding business names.

    Choose a name for your business  that complies with your state's rules for LLC business names. The main part of the business name is generally very flexible, but each state has a list of prohibited words, such as "Corporation", "Incorporated", "Insurance", "City", and others. Your legal name must end with an LLC designator, such as "Limited Liability Company", "LLC", etc. Also, the name can not be the same as another LLC on file in the state in which you are filing.


    Fill out the LLC Articles of Organization form. This is usually a relatively simple process, as the only things you need to notify the state about regarding your LLC are items such as name, its business purpose, principal office address, the "registered agent" for receiving any legal documents, and the names of the initial members. You do NOT have to specify at this point the ownership distribution or management structure, just the names of the LLC's members.

    Publish a notice in your local newspaper of your intention to form an LLC (if required by your state - don't waste the money otherwise). This should be done prior to filing your Articles of Organization. Currently this is only required in Arizona and New York. Check with your state's Secretary of State to be certain.

    Submit your Articles of Organization form to your Secretary of State along with the appropriate filing fee. Fees range from $40 to $900, depending on the state. Be careful: some states may have a corporate tax which is separate from the filing fee but must be paid at the time of filing. For example, California has only a $70 filing fee, but an $800 annual tax.
   
You also want to have an Operating agreement if you plan to hire employee's or are not solo owner. It's often not required by your state but is a good idea unless you are planning to stay a solo owner/operator/no employees.

The  LLC Operating Agreement spells out the financial and management rights and responsibilities of the LLC members, such as: who contributes what if the LLC needs additional capital, when and how profits from the business will be distributed, under what terms members can leave the LLC, etc. Even (or perhaps especially) among friends and family, leaving these questions unanswered can create strains on both the business and personal relationships down the road.


It's also the  best option for small businesses to incorporate in the state in which it will principally be doing business. There are some tax and organizational advantages to registering in certain states, however. Delaware, Nevada, and recently Wyoming are the most popular for out-of-state corporate registration. Consult with an attorney or research it on the web further if you are in doubt.
Linda Walker
Practice Managers Resource & Networking Community
One Stop Resources, Education and Networking for Medical Billers
www.billerswebsite.com

gurumedbill

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Re: What is LLC?
« Reply #2 on: May 01, 2013, 09:45:30 AM »
Linda briefly mentions this but I just want to reiterate that in order for you to use the business cards you must be able to get the name Medical Coder, LLC.  If that name is already taken then you will have to throw out your business cards and get some new ones.  You can't represent yourself as that company if that company already exists.  There cannot be two companies in the same state with the same name.

PMRNC

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Re: What is LLC?
« Reply #3 on: May 01, 2013, 10:41:49 AM »
Yep, AND you MUST use the LLC for EVERYTHING where your name appears. If you don't and something happens you do NOT have the umbrella of the LLC
Linda Walker
Practice Managers Resource & Networking Community
One Stop Resources, Education and Networking for Medical Billers
www.billerswebsite.com

ASHDYE

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Re: What is LLC?
« Reply #4 on: May 01, 2013, 04:35:28 PM »
Thanks a lot you guys!...sounds like "LLC" is like insurance for your business? I guess it wont hurt to get it...I thought getting my business license would be enough. :-\

davis.alexander

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Re: What is LLC?
« Reply #5 on: July 10, 2013, 05:47:59 AM »
A limited liability company (LLC) is a flexible form of enterprise that blends elements of partnership and corporate structures. An LLC is not a corporation; it is a legal form of company that provides limited liability to its owners in the vast majority of United States jurisdictions.It is a  hybrid business entity having certain characteristics of both a corporation and a partnership or sole proprietorship (depending on how many owners there are). An LLC, although a business entity, is a type of unincorporated association and is not a corporation.