I’m proud of you for asking such a clever question. Makes me wish the answer was just as thoughtful. Alas, it’s not: there’s no difference. A shareholder in a corporation, and a member in an LLC, are both nomenclature for defining owner. In fact, LLCs are flexible enough such that they can be structured to […]
It used to mean more than it does now. California has dropped this as a concept, and where it’s still used, it’s for tax and fees purposes. Some states tax corporations based on capitalization, and they use par value to assess that tax. So you should not just “pick a number”. Some of the fees […]
Terminating an LLC in California is a pretty simple affair. I wouldn’t blame you if this is the one thing you choose to DIY, since you can do it online. There are legal issues, though, in terminating an LLC or any entity. For example, you need to make sure that the LLC’s debts are paid […]
Yes, of course. You lose the advantages of operating under the auspices of an entity, but that increased risk may be minimal. See this FAQ for a fuller discussion of pros and cons.
Though I appreciate your need to be thrifty when it comes to starting a new business, this sort of money-saving approach is inadvisable. Occasionally a company will have a “division” or some other kind of structure that makes sense by way of keeping all things under one umbrella. For example, a hardware store may open […]
You need to declare a par value only when the state in which your corporation has been filed requires it. Delaware requires it.
Limited partnerships (LP) have been the go-to entity for certain kinds of industries for years. The most prevalent use has been in real estate, where the ownership is usually made up of one person who manages the operations and the cash flow, and the rest of the partners are silent partners, or “limited partners”. Why […]
A general partnership (GP) can come in very handy when you want to be in a joint venture or some other enterprise, and liability is either not an issue, or each “partner” has their own entity for liability protection. In fact, people who start “doing something” together can find themselves in a general partnership without […]