Below you will find helpful and informative Rhode Island business law articles by a Rhode Island Corporate attorney. Please read these carefully and do not hesitate to contact a RI business law lawyer for help with all your legal needs in RI and MA.
Business law articles by a business lawyer in RI:
Operating & setting up a Limited Liability Company (LLC) in RI- This business law post was authored by a Rhode Island corporate lawyer. This commercial law post explains the process of organizing and operating an LLC in RI. This informative legal article discusses the numerous benefits of a limited liability Company. These benefits include the limited liability of the members of the LLC for the debts of the limited liability company. Also members of an LLC have no personal liability for personal injury, truck accident, car crashes and slip and fall claims caused by other agents, employees or member of the company.
This Rhode Island law article explains the necessary documents and fees required by the Rhode Island Secretary of State. Most small businesses and real estate holding companies in Rhode Island should be an LLC. One of the most crucial reason for forming an LLC is that the owners of the limited liability Company, who are referred to as members, are not liable for the debts of the company. A limited liability company provides many legal benefits and advantages which are set forth in this business law post authored by a Rhode Island corporate lawyer at Slepkow Law
RI Corporations, Partnerships, Limited Liability Company (LLC), Small Business Law RI Corporate law FAQS by East Providence lawyers concerning corporations, llc’s and partnerships. 1) Should I protect my primary residence and personal assets by incorporating my business? 2) What is the difference between a corporation and an LLC in RI? 3) What will my business law lawyer need to know at our first meeting in order for him to incorporate my real estate business? Both corporations and an (LLC) provide asset protection against many personal injury claims and most contract claims against your personal assets. The primary difference between the two types of legal corporate entities involve the treatment of profits and losses for income tax purposes.
Legal references concerning business law:
The US Small Business Association States: “A limited liability company is a hybrid type of legal structure that provides the limited liability features of a corporation and the tax efficiencies and operational flexibility of a partnership. The “owners” of an LLC are referred to as “members.” Depending on the state, the members can consist of a single individual (one owner), two or more individuals, corporations or other LLCs. Unlike shareholders in a corporation, LLCs are not taxed as a separate business entity. Instead, all profits and losses are “passed through” the business to each member of the LLC. LLC members report profits and losses on their personal federal tax returns, just like the owners of a partnership would.” SBA
Resources:
The IRS states: “When beginning a business, you must decide what form of business entity to establish. Your form of business determines which income tax return form you have to file. The most common forms of business are the sole proprietorship, partnership, corporation, and S corporation. A Limited Liability Company (LLC) is a relatively new business structure allowed by state statute. Legal and tax considerations enter into selecting a business structure.” IRS
“Unlike shareholders in a corporation, LLCs are not taxed as a separate business entity. Instead, all profits and losses are “passed through” the business to each member of the LLC. LLC members report profits and losses on their personal federal tax returns, just like the owners of a partnership would.” US Small Business Association
Incorporating a business offers several legal benefits to entrepreneurs and business owners. It’s important to note that the specific advantages can vary depending on your jurisdiction and the type of business entity you choose (e.g., corporation, LLC, etc.). Here are some common legal benefits of incorporating a business:
- Limited Liability Protection: One of the most significant benefits is limited liability protection. When you incorporate your business, it becomes a separate legal entity from its owners. This means that the owners (shareholders or members) generally have limited liability for the company’s debts and legal obligations. Personal assets are typically shielded from business creditors in the event of lawsuits or financial difficulties.
- Perpetual Existence: Corporations and certain other business entities have perpetual existence, which means the business can continue to operate even if the ownership changes or if one of the shareholders or members passes away.
- Easier Access to Capital: Incorporation can make it easier to attract investors and raise capital through the sale of stocks or shares. This is particularly beneficial for businesses with ambitious growth plans.
- Tax Advantages: Depending on your jurisdiction and the type of entity, there may be tax advantages to incorporating your business. For example, corporations often have more options for managing and deferring taxes. Consult with a tax professional to understand the specific tax implications for your situation.
- Credibility and Professionalism: Operating as a corporation or LLC can enhance the credibility and professionalism of your business, which can be appealing to customers, clients, and partners.
- Ownership and Transfer of Shares: Incorporation allows for the easy transfer of ownership through the sale or transfer of shares. This can simplify succession planning and ownership changes.
- Centralized Management: Corporations typically have a clear management structure with a board of directors and officers, which can streamline decision-making and provide for a clear chain of command.
- Regulatory Compliance: Many jurisdictions have specific regulations and reporting requirements for incorporated businesses. While this may involve additional paperwork, it can provide a clear legal framework for operating your business and help you maintain compliance with state and federal laws.
- Intellectual Property Protection: Incorporation can provide a legal framework for protecting your business’s intellectual property, such as trademarks, patents, and copyrights.
- Contracts and Legal Obligations: When you operate as a corporation or LLC, contracts and legal obligations are typically entered into by the entity rather than the individual owners, providing a level of separation between personal and business affairs.
It’s important to note that while incorporating a business offers many legal benefits, it also comes with additional administrative and compliance requirements. You should consult with legal and financial professionals to determine the best legal structure for your business based on your specific goals and circumstances.
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