Frequently Asked Questions
How many people are needed to form an LLC?
An LLC must have a minimum of one member. There is nothing specifying a maximum number of members.
What is the difference between a member and a manager?
In an LLC, the member is the owner of the company (like the shareholder of a corporation). The member has contributed to the company and has a vested interest. The manager of an LLC is someone who has been appointed by the members to handle the affairs of the business (similar to the director of a corporation). The manager may, but is not required to be a member.
Who can be the member of an LLC?
Typically, there are no restrictions regarding membership of an LLC. A member can be a corporation or other business entity. It is not necessary for the business entity to be a US business. Of course, the member can also be a natural person. If the member is a natural person, some states require that the person be 18 years or older. There is no requirement for a member who is a natural person to be a US resident or citizen.
What is a Limited Liability Company (LLC)?
A Limited Liability Company (LLC) is a type of business structure which has characteristics of both a sole-proprietorship and a corporation. LLCs are able to be treated as a partnership or sole-proprietorship for taxation purposes while offering the personal liability protection of similar to that of a corporation. Owners of an LLC are called members. Most states do not restrict ownership, and so members may include individuals, corporations, other LLCs and foreign entities. There is no maximum number of members. Most states also permit “single-member” LLCs, those having only one owner. A few types of businesses generally cannot be LLCs, such as banks and insurance companies. Check your state’s requirements and the federal tax regulations for further information. There are special rules for foreign LLCs.