6 Common Questions about LLCs

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If you are ready to start a business in the US, you may be considering forming an LLC or limited liability company. If this is a consideration, some common questions and answers about LLCs can be helpful to know before you start an LLC.

“Can a Foreign Company Own an LLC?” & Other Questions–Answered

Forming or running an LLC can be a complicated process, especially for foreign individuals unfamiliar with LLC laws. At Rooney Nimmo, we answer some of the most common questions regarding LLCs and offer legal advice to ensure you are complying with all the relevant filing laws.

1. What Does it Cost to Form an LLC?

When forming a business venture, cost is always an important consideration. To start an LLC, you will need to pay a filing fee for your Articles of Organization. While the fee varies depending on which state you’re forming your LLC in, you can usually expect to pay between $50 and $200.

2. Can You Use an LLC For Any Type of Business?

Generally speaking, yes. However, business ventures such as insurance companies or banks typically cannot operate as LLCs.

3. Can a Foreign Company Own an LLC?

Yes, a foreign company or person can own an LLC, and the owner does not have to be a US citizen or have a green card to own it. In most cases, there are no restrictions on an LLC owned by foreign corporation.

4. How Can a Foreign-owned LLC Get an Employer Identification Number?

Like any company, all foreign-owned single member LLCs can apply for an employer identification number, or EIN, by submitting an SS4 form that’s signed by a responsible party.

5. Is There a Limit on How Many Owners an LLC Can Have?

No, there is not a legal limit to how many owners an LLC can have.

6. What Happens if a Single-member LLC becomes a Partnership?

When a single-member LLC is classified as a disregarded entity—meaning it only has one member—and adds a member, it becomes a partnership. When there are at least two members and an LLC is classified as a partnership, they will now be required to follow partnership filing and reporting requirements. The owners must file for US Return of Partnership Income.

Between members, they will also have to decide who is the member manager, which means they have the continuing authority to make management decisions needed to conduct business. If a member isn’t designated to serve in this role, each owner will be considered a member manager.

Understand LLC Laws With the Help of Rooney Nimmo

At Rooney Nimmo, we can answer more of your questions around forming an LLC and guide you along your startup journey. Once you’ve established your enterprise, we’ll help you further your business objectives by providing business-focused legal services and solutions. Contact us today to see how we can help you grow your business venture.

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