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When starting a new business venture, there is a lot to do and a lot of questions. From the legal side, which entity is right for me? Does it provide enough protection? Do I really need an entity, or can I get by without one? Hopefully, the information below will help you gain a basic understanding of the subject. And, as always, please call our Las Vegas, Nevada, law office for a free consultation to go over your specific situation.
Can a Las Vegas Business Lawyer Help You Set Up an LLC, Series LLC, Articles of Organization, and Operating Agreements?
LLCs and Series LLCs are set up the same, for the most part. The difference between a regular LLC and a Series LLC is that a series provides more asset protection because you can designate equipment, accounts, or property into separate series that, from a liability standpoint, are separate from each other. It is like each series acts like its own LLC from a liability standpoint while only having one company to file with the State for licenses and only one tax return to file. It truly is the best of both worlds.
That being said, the Series LLC may not be the end all be all. If you do a lot of business out of state, it may not work because most states don’t recognize Series LLCs. Also, in some cases, including tax, it might make sense to separate the businesses out.
LLCs, in general, are a great estate planning and asset protection tool. They are the most versatile of all of the entity structures because they can be taxed as a partnership or S-Corp while maintaining that vital Limited Liability to all of the partners. Hence the name Limited Liability Company.
How Can a Nevada Business Attorney Help You Set Up a Corporation (C-Corp and S-Corp) with Bylaws, Minutes, and Articles of Incorporation?
Besides partnerships, Corporations are the oldest business entity structure. They were first formed back in the 1600s to protect those who invested in trade shipping. Today, when most people hear of a corporation, they think of the big ones on Wall Street. The thing is, most corporations are much smaller than that. You can have single-owner corporations or many owners. There are C-Corps and S-Corps. This is one area where we would definitely want to work side by side with your accountant or CPA to make sure that the corporation setup makes sense not only on the liability side but also on the tax side.
Also, with corporations, we can set up special “Professional Corporations” for those of you who have credentials after your name, such as doctors, attorneys, dentists, CPAs, and so on.
What is Las Vegas Business Succession Planning?
Have you ever thought about what will happen to your business when you are ready to retire or if you die? Can you sell the business? Who can take over? What legal requirements do you need to worry about? Do you want it all just to disappear because you are done working in the business? Do you work with a partner in your business? Have you ever thought about what would happen if your partner died? If you don’t have any documentation in place, then when your partner dies, you could be in business with their spouse or kids or both. What if that partner holds a special license to operate the business? Can you get the license to keep the business going? We know these are all terrible situations to think about, but the reality is things happen, and if you don’t plan ahead, then everything you’ve worked so hard to build may be gone either because of death or because of a forced sale.
To learn more, contact our Las Vegas business law firm to schedule your free 30-minute case evaluation today.
What Are Buy-Sell Agreements?
One way to plan for the unexpected in business with a partner is through a BUY-SELL agreement. This is where both you and your partner agree that if either of you dies, the survivor or the business has the first right to buy the deceased partner’s share of the business and that the deceased estate, spouse, kids, or trust must sell it to the business.
This ensures that the business can continue and that the surviving partner does not have to be partners with a deceased person’s spouse, kids, trust, or estate. Think of this like a will for your business. You are laying out exactly what you want to happen upon your death, this time specifically for the business.
The buy-sell doesn’t just have to be about death either. What about if a partner becomes disabled? Do they still retain ownership, receive a salary, or do they get bought out? The nice thing here is it can be as flexible or airtight as you want. We can also include terms about if a partner wants to leave in the beginning when the foundation is being laid. Typically, incentives to stay are such that if a partner leaves in the first five years, they get a percentage reduction in the amount to be paid for their shares. For instance, if the business is worth $100,000 with two partners, each a 50% owner in the company, and the buy-sell agreement says that the partner leaving only gets 80% of his fair market value in the stock. This would mean that the partner selling would only get $40,000 from his partner instead of the full $50,000 value.
Just like with Trusts, you can be very creative and specific here. The buy-sell agreement can lay out ahead of time how value is to be determined, what interest rate will be paid, and if life insurance is to be paid for by the company to cover the purchase price of the ownership interest.
Schedule a Free Case Evaluation with Experienced Las Vegas Business Attorneys Today
If you are a Las Vegas business owner with legal questions or concerns, we would gladly lend legal assistance. Our law firm, which is conveniently located a short 11-minute drive away from Harry Reid International Airport (LAS), prides itself on providing communicative and comprehensive legal services to clients in need. We have extensive experience in Nevada estate law, business law, and corporate law. Whether you are drafting an employment agreement or confidentiality agreement, looking after the interests of your investors, protecting your intellectual property, entering into a partnership agreement for a new or existing business, contending with business litigation, or have other business-related concerns entirely, we want to be there throughout the entire legal process.
To learn more about our legal services and how we can assist you, please contact our Las Vegas, NV, law firm to schedule your free consultation today at 702-664-8858.