LLC

Furby · March 31, 2004, 04:18:10 PM

I am looking for information on setting up a LLC in Michigan.
Can any of you provide me with links and/or info from your own setups?

chet · March 31, 2004, 04:30:26 PM

There are links from the michigan.gov site that will provide you with the forms that you need to file with the state. Or you could do as I did an talk with an accountant. They will set you up with the forms and even help you to fill them out if you would like. I would recomend just filling out and sending in the forms yourself "articles of organizations" they are called. By filling out the forms yourself you will not have to pay the accountant, only the $50 filing fee with the state. Hope this helps...

Jeff Swenski
Swenski Construction, LLC

oakiemac · March 31, 2004, 04:54:05 PM

Hi Furby.

When I set up my LLC, I had an attorney do it. But if I were to do it again I'd set it up myself. Having said this, I will also say that I am the sole owner and operator. If you are going into buisness with a partner then you probably want an attorney to set things up and make it all legal.

Norm · April 01, 2004, 04:36:26 AM

Furby I'll have Patty add to this as she did some research about settin up an LLC for our farm. Go to your secretary of states' web site for Michigan and they most likely have the forms and some intructions on how to set one up. If your setting one up for a business with other people involved then have a lawyer with a business background help. They have experience setting em up so you have some protection. A better question is if you really need one. Sometimes settin up incorporation papers and such is more hassle than it's worth. A common misconception is that it will shield your personal self from the corp, not true.

redpowerd · April 01, 2004, 05:15:25 AM

im confused as to how an LLC operates, instead of a partnership, theres shareholders?

how can one be independant and still have an LLC tagged onto their farm?

what happens when shareholders leave?
they just sell out, or a new LLC set up?

this is important around here, as farmers are getting more competitive for acres. anyway to have an edge without loosing your shirt.

Ga_Boy · April 01, 2004, 05:24:21 AM

Tom/Jeff,

I hope one of you are watching this.

What about a forum for Management & Business questions. I know for folks like me who are just staring out I have a lot of questions with no specific place to post them.

Just a thought.

Ga Boy

Brian_Bailey · April 01, 2004, 05:38:08 AM

Redpower,

Here is a link to the types of businesses that can operate in NY.
Legally anyways :D :D

http://www.dos.state.ny.us/corp/formbus.html#llc

redpowerd · April 01, 2004, 05:52:08 AM

:D :D
thanks for this link, brian, but it answerd NONE of my questions. thats NY for ya. wait, thats the states for ya. wish i could pick up my farm and move it to brazil! :D

Tagerts_crossing · April 01, 2004, 06:05:24 AM

Regarding the issue of shares that red asked. Their can be Two or as many as you want. You can hold them all or if you have two, one in your name and one in your wife,father,son or Buss. partners name. Not sure if this is what you were looking for or not. We are in Indiana and went with the c corp. and then changed to the s corp. later.

Brian_Bailey · April 01, 2004, 06:42:15 AM

Redpower,

Here's a link to all your answers ;).

http://assembly.state.ny.us/leg/?cl=57

redpowerd · April 01, 2004, 07:33:42 AM

very funny, brian ;D

questions answerd for me

now, wheres the advantage?

Brian_Bailey · April 01, 2004, 09:27:44 AM

Redpower,

Nothing funny about it, thats the law concerning LLC's in NY. Tells ya everything ya need to know.

Advantage ?? That's up to you to decide if an LLC is right for ya ;).

Ga_Boy · April 01, 2004, 09:37:55 AM

Have ya considered do'in an S Corp?

Not sure the benefits to LLC over S Corps, the LLC are kinda new so all the laws ain't finished working them self out yet. :P

Furby · April 01, 2004, 10:02:35 AM

This is my problem, is it all worth while?
All the info I can find is vague.
I was told by a friend at work that if I'm going to do work for anyone, as income, and not be an employee of that person, I should protect my personal assets with an LLC.
I'd also like to be able to purchase equipment and be able to write part of it off.
I don't want this getting to big and expensive, then it would defeat the purpose, right?
I plan to be sole owner.
So, any ideas?

Ga_Boy · April 01, 2004, 10:19:19 AM

From what I know, which ain't much I want to be an S Corp. Cause this way if I get sued for some reason they can't touch my house. They can only go after what is owned by the S. Corp.

DanG lawyers!

redpowerd · April 01, 2004, 11:21:22 AM

brian, i was only jokin' ;D
im with furby, as worth-whileness, and vagueness ;D
just wondering on first-handedness, and tidbits like ga boy gave, conversation ;)

Furby · April 01, 2004, 11:31:06 AM

Ga_Boy,
It's my understanding that is what the LLC does. The S Corp is a little more complexed.

Ok, they're all complexed! :

Norm · April 01, 2004, 11:50:14 AM

An LLC will not protect your personal assets house included, nor will a corporate designation. It is a common misconception but I can tell you from experience that if someone sues you and you are the primary owner all of your assets are fair game. Each state has different rules regarding how to set up a business. For what you want to do Furby it sounds like a sole proprietorship would be better with less hassle. But your asking a question that would be better answered by a lawyer that specializes in business.

ADfields · April 01, 2004, 12:06:31 PM

LLC = Limited Liability Corporation and that is just what it is for. You become an LLC so if you lose a lawsuit at your business you wont lose your home. Now they could muddy up the waters if they "name" you and your LLC when they sew and it was your fault it happened and not your employees fault but this stuff gets WAY complex!! :

You become an employee of the LLC not the guy that owns a house and a sawmill/farm.

There are also tax advantages to it and some tax bad points. But in 5 years or so the Corp can have it's own credit and you have a firewall around you as a person so if your business credit is damaged yours is not, and if your corp is bankrupt you don't need to go with it.
Andy

Patty · April 01, 2004, 12:29:37 PM

I have been studying business law for awhile :

and each state has their own rules as to what is legal and how to set it up. As far as protection from lawsuits, if the guy suing you has any kind of a lawyer, you are not protected in any way, the corporation, or limited liabilty company will just slow em down a bit, and just a tiny bit at that, since you would be listed as one of the officers or partners. With that said, Norm & I have our business registered with the state of Iowa as an S-Corp. This was done for tax purposes which is another long subject altogether.
Some protection is offered if you file as an LLP (limited liability partnership), but that protection is not from lawsuits so much as protection for the partners themselves.
Any accountant can give you the proper forms to fill out, and a GOOD accountant can give advice as to what you should do to fill your needs as far as taxes go, but a business lawyer would be able to answer questions about what type of a set up you need for your business, or if you should just set up as a sole proprieter. One way to find a lawyer who knows business law is to call the local junior college, and ask for the lawyer who teaches the classes. Or, if you have the time, take the business law classes yourself, if the instructor is any good at all, you will leave with a wealth of information. Norm and I owned a business several years ago, that required the use of a lawyer quite frequently. I learned then that a few classes myself would save thousands of dollars in attorney fees and give me peace of mind. Something to consider if you are interested in setting up a business.

Patty · April 01, 2004, 12:36:40 PM

Andy is correct in that you can become an employee status of the corp and be protected some, but the officers are ultimately responsible, and that is who the lawyers will go after, in addition to the corp itself.
In theory the corp becomes its own entity, with its own credit etc, however the lawyers will go beyond that, if it is a serious lawsuit, and go after the officers in a personal way too. If it is just a minor lawsuit, and the corp can pay it off if necessary, then the officers won't be tapped, but if it's more than the corp can handle, then the lawyes will go after everybody involved.

oakiemac · April 01, 2004, 12:43:58 PM

When I set up my LLC I asked the lawyer if it sheilds my personal assets from the companies. He replied yes and showed me the michigan statutes that applied.
I relize that anybody can sue anybody for just about anything and nothing will protect you 100%, but Michigan law has the LLC just for this purpose.

Brian_Bailey · April 01, 2004, 02:50:18 PM

redpowerd,

Ya, I know, I could feel the tugging on my leg :D :D.
Since you asked some very important questions and you're in NY, I thought it best to point you to the law.

I looked into this subject for my business awhile back and was advised to stay a sole proprietor.
I was told the only reason to go into a LLC or S structure is for the tax advantages in doing so.
Structuring your business as a LLC for the purpose of protecting your personal assets in case your LLC is sue'd won't hold up in court.
I was also advised it would be better to just purchase additional liability insurance (umbrella coverage).

Everyone has a different set of circumstances and should seek professional advice to see what's best for them.