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LIMITED LIABLILITY COMPANY
THE BEST FEATURES OF A CORPORATION AND A PARTNERSHIP
The limited liability company is a hybrid of a corporation and a partnership. It takes the liability protection of a corporation and combines it with the relatively simple organizational structure of a partnership.
Michigan allows both single member and multiple member limited liability companies.
A Limited Liability Company is a relatively new form of business organization. Prior to the early 1990s the only methods of corporate organization were Sole Proprietorships, Partnerships and Corporations.
Sole Proprietorships and Partnerships were for individuals wanting to give a name to their business (sometimes called a DBA). Partnerships allowed two or more people to form a business and sign an agreement that detailed the relationship between the partners. While sole proprietorships and partnerships provided a relatively simple way to organize a business, they did not provide any liability protection for their owners.
A Corporation provided liability protection for the individual owners of the business (the shareholders) but created a fairly complicated organizational structure. The shareholders elected a board of directors and the board of directors elected officers. The shareholders, directors and officers where each required to hold annual meetings and publish minutes of those meetings. If the corporation had only a handful of shareholders, the three tiered organization is very cumbersome. If the corporation fails to satisfy all of the paperwork obligations its shareholders could lose their liability shield.
The Limited Liability Company takes the simplicity of a partnership and the liability protection of a corporation. The individual owners are called "Members". There is no need for officers, but they are allowed, and the annual paperwork requirements are much less than that of a corporation. The owners of the limited liability company can spend their time running their business rather than holding corporate meetings and drafting corporate minutes.
You can prepare your Michigan Limited Liability Company Online quickly, easily and affordably with the confidence that comes from the assistance of a licensed Michigan Attorney.
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