It is no surprise that the LLC has become the most popular limited liability entity to form in the U.S. The flexibility afforded by the LLC structure is attractive to many entrepreneurs, especially small businesses. There’s one important step that owners of an LLC should not overlook: drafting the operating agreement. Today’s post highlights some of the main benefits of drafting an operating agreement for your LLC.

What is an Operating Agreement?

It’s a contract between the owners of the LLC (referred to commonly as “members”) and the LLC itself. The operating agreement includes terms that detail (among other things) the management rights, distribution of cash, allocation of profits of losses, and how members can join and exit the company.

Setting Clear Management…

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Numerous small businesses today are organized as a limited liability company (LLC). An LLC offers flexibility when organizing the management and economic structure of an entity. Due in large part to this flexibility, the LLC has become the most popular choice of entity to form when seeking limited liability protection for new small businesses. Below we’ve put together some information to help you decide whether to elect to be an LLC taxed as an S corporation.

Key Distinctions between S Corporations and LLCs

When deciding how your small business should be taxed it is important to understand the distinctions between S corporations and LLCs. An S corporation refers to the tax treatment of an entity. An S corporation is not a type…

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If you’ve done any searching online, you’ve probably read that limited liability company (LLC) entity offers flexibility when organizing the management and economic structure of the company. And because of this flexibility, the LLC quickly became the most popular entity to form in order to shield personal assets from business liabilities. One of the areas where LLCs offer flexibility is how to structure payments to owners of the business. Today’s post discusses the fact that owners of an LLC can only be considered “employees” if the LLC elects to be taxed as a corporation.

Can LLC Members be Paid as Employees?

Members (owners) of an LLC cannot be considered “employees” of the business unless the LLC elects to be taxed as a…

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As a small business owner, it is important that you are aware of all mandatory regulations that affect your business. One such regulation for employers in Washington is providing workers’ compensation coverage for all non-exempt employees. Today’s post discusses some general information related to workers’ compensation insurance, and highlights certain individuals who are not required to be covered by workers’ compensation insurance.

What is workers’ compensation insurance?
Workers’ compensation provides no-fault insurance coverage for most employers and workers in Washington state. Workers that are unable to work because of a work-related injury or occupational disease may be eligible for partial wage replacement benefits and medical treatment for injuries that occur as a result of their employment. Employers are required to…

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