Is An LLC Right For You?

by | May 10, 2021 | Business Formation and Planning

Do you have a small business, or are you thinking of starting one? A Limited Liability Company (or “LLC”) could be right for you. There are many benefits to having an LLC, and starting one is a straightforward process. Iowa allows simple, low-cost LLC formation with only a few follow-up reporting or filing requirements.

In order to form an LLC, you, your business attorney, and your financial advisor must take some preliminary steps. You should choose a name for your company that is available and not too similar to another business entity. You will need to identify the names and the role of any other members – the people who are invested in your business and its success. Your attorney will draft and file a Certificate of Organization with the State of Iowa. 

With your input and insight, your attorney will also prepare an Operating Agreement tailor-made for your business. The Operating Agreement is flexible and can be amended as needed. What benefits, costs, or risks to the Members is all dependent upon the Operating Agreement that the members sign.

 

Arguably the biggest benefit to having an LLC is right in the name: an LLC limits the liability of its members. Unlike partners in a partnership, members don’t have to risk their own assets. If the LLC is sued, members can easily protect their personal assets. 

LLCs are easy to manage. Once the LLC is filed with the State, there is some minor maintenance. You, your attorney, or someone else must be listed as your Registered Agent. The Registered Agent this person receives official notices directed to the company, accepts service of process on the LLC’s behalf, and is responsible for filing your Biennial Reports and any other documents with the State. Additionally, your LLC Members must meet at least once a year to discuss basic business matters. That annual meeting is documented and added to your company’s file.

An LLC is a great legal tool to protect you and propel your business into a successful future.  If you have an Iowa-based business, your LLC should be Iowa-based, too. Your attorney will answer all of your questions, learn about your business and goals, and provide you everything you need to build and maintain a successful company.