Published Feb. 8, 2013
Q: What are limited liability companies (“LLCs”), and what should businesses know
about them?
A: LLCs are a new type of business entity that emerged in the early 1990s. They have many important legal and tax characteristics, but the key ones are these:
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Liability shield. LLCs provide their owners (called “members”) with a statutory liability shield that is essentially identical to the corporate shield.
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About the Author
John Cunningham is a N.H. business lawyer whose practice is focused on LLC law and tax. He chaired the N.H. Business and Industry Association committee that drafted the Revised New Hampshire Limited Liability Company Act, a radical revision of New Hampshire LLC law that went into effect on January 1st. LLCs are, by a wide margin, the entities of choice for N.H. business start-ups.
As a small business owner, being under- or uninsured can cost you your company and land you in jail. Greg Bivona, a retired insurance industry executive who now helps entrepreneurs as a SCORE mentor, recalls a 2005 case in which a Bloomfield, Conn., trucking company owner met both those fates when one of his uninsured dump trucks caused a catastrophic accident that resulted in 5 fatalities. Yahoo! Small Business Advisor asked Bivona for a quick insurance tutorial like one he offers small business owners in local SCORE workshops.
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