Setup an LLP - Limited Liability Partnership
Setup a U.S. LLP - Limited Liability Partnership - LLPs can be a good choice if you plan on going into partnership with people in a business venture. LLPs protect you and your partners from personal liability in most instances and provide a good foundation for regulating profit distribution with business partners.
The Advantages of Setting up an LLP
Since the 1990s, a limited liability partnership (LLP) has become a popular form of business organization for many licensed professionals, such as lawyers, doctors, architects, dentists, and accountants. LLPs are creatures of state statutory law and may be formed by two or more partners. Texas became the first state to adopt a law permitting the creation of LLPs and about forty states now formally recognize LLPs. A number of states may limit which types of professions may create an LLP so your state laws will impact whether or not you are eligible to form an LLP. With all of the different types of business organizations to choose from, you may wonder why to choose an LLP over other forms of business entities. Here are some of the key advantages of an LLP.
Limits Potential Legal Liability - A main benefit of creating an LLP is a balance of management control with reduced liability exposure. Similar to a general partnership, an LLP permits eligible parties to form a business entity that allows its partners to actively participate in the operation of their business. Unlike general partners, partners in an LLP usually possess some form of limited potential personal liability for the debts, negligence, or wrongdoing of other partners in the business organization. Typically, LLP partners may only risk their capital contributions and do not face unlimited personal liability for another’s mistakes. However, LLP partners are still liable for their individual mistakes or intentional misdeeds, including failing to exercise reasonable care in their professional activities and not properly supervising their employees or agents. An LLP often must carry minimum amounts of liability insurance and/or may be required to post a bond or other form of financial security to help protect the general public from possible liability claims.
Allows for Flexible Roles for Partners - In an LLP, each partner has the right to manage the business entity and retain flexibility in shaping their role in business operations. The LLP partners have a great deal of freedom in determining how the LLP will be managed. The LLP partners can agree to delegate daily business operations to a managing partner or to a committee made up of partners. Alternatively, LLP partners may decide to divide up duties based upon expertise, experience, or personal interest. To avoid confusion, it may be useful to develop an LLP agreement to outline each partner’s role in the business.
Provides for Relative Ease of Formation - As stated previously, state law controls the requirements for LLP formation. But generally it is relatively simple for eligible parties to create an LLP. LLP partners often must complete a registration form and file it with the relevant state agency, such as the Secretary of State’s office. State statutes may also allow existing general partnerships to convert their partnership to an LLP. As indicated above, it may be helpful to develop an LLP agreement to spell out each partner’s roles and to identify each partner’s financial contributions and attendant profits and losses.
Offers Possible Pass-Through Tax Relief - Typically, the LLP shares the limited liability of a corporation, but avoids the double taxation associated with a corporation under IRS rules. Each partner files their share of LLP profits and losses on their individual federal tax returns. As independent professionals, LLP partners normally pay self-employment taxes. For tax purposes, an LLP is often not taxed as a separate business entity under federal tax laws. Yet certain state statutes may not permit pass-through taxation and may impose a state franchise tax on the LLP business entity. Your local tax professional can help you sort out these complex tax issues.
We provide fixed business address services in any of the 50 states, often with multiple options to choose from. Our virtual address service offers a permanent business street address for registering your company.
Setup an LLP
Setup an LLP (Limited Liability Partnership) - An LLP lets you take advantage of the benefits of both the corporation and partnership business structures. LLPs protect you from personal liability.
Once we have your company formation complete and have your articles back from the state, alongside your EIN tax ID IRS letter, we can put you in touch with our banking partners to get your account setup.
For step 1 in your company formation, we will use an online notarization service to validate your identity as the company founder or representative. To complete this simple process we use a online notarization platform provided by our partner, NotaryCam, the online notary public.
US Business Address
To open a company in the United States, you are required to have a US business address in the state of incorporation. Once step 1 has been completed, we will obtain a registered business address for you in the state of your company formation. This address serves as a business address and registered mail forwarding address.
Filing Documents with State
For step 3 in your company formation, the filling of incorporation documents with the state or federal government is required. As part of our U.S company formation services we will file these documents on your behalf. This is part of our incorporation service.
Obtaining an EIN Tax ID
An EIN Tax ID is required by the IRS and U.S Banks to track your business associated income and operate your business legally. As part of our U.S business formation services we will obtain an EIN on your behalf. This is part of our incorporation service.
Registered Agent Services
If you’re forming a corporation or a limited liability company, you’ll need to select a registered agent for your business and provide the agent’s name and address on the formation documents you file with the state. We can provide this service on your behalf. We offer registered agent services in 50 states.
Bylaws and Resolutions
Bylaws and resolutions are the initial decisions of your corporation’s board of directors and basic "operating rules" of your corporation. As part of our U.S company formation services we will provide initial drafts of these on your behalf. This is part of our incorporation service.
U.S Business Bank Account
Foreigners (non-U.S. residents) can open a U.S. business bank account for their company. You don’t have to be an American or a U.S. resident to open a business bank account in the U.S. There are 2 main options for foreigners who need to open an account, in person or via an international branch.
International Docs Delivery
As part of our service for international clients, where you select the option for a corporate kit, we will deliver your business incorporation documents, EIN tax ID forms and any additional selected supplements to you anywhere in the world as part of our service offering.
Download our Platform Services Brochure
Access our 25 page brochure on setting up a company in the United States as a non-resident - A step by step overview of our LegalTech company formation platform and services