Limited Liability Companies – have become increasingly popular, though they are a fairly recent creations, starting in the mid to late 90’s. Wyoming, is an exception, with their state adopting the statutes in the mid 70’s. There are some downsides with this being a new entity as it lacks the long courtroom history of precedent and case decisions, like corporations do, so there is some uncertainty on how limited liability companies may be handled under unique circumstances.

Mark J. Tarallo, Esq. is a partner in the corporate department at Morse, Barnes-Brown & Pendleton, PC, in Waltham, MA. Mark has extensive experience in the mergers and acquisitions area, representing both buyers and sellers, and has represented companies ranging in size from startups to multinational corporations across a wide range of industries.

Robert Finkel, Esq. is an AV-rated attorney who has more than 25 years experience as a tax and business lawyer, with his practice focused on the areas of individual and business taxation including tax controversy and tax litigation.

In this CLE class clip, Mark & Robert discuss the different entity choices in LLC Operations.

Limited liability companies are very flexible and offer a wide range of applicability across various industries. An LLC is a fictitious entity created by state statute offering limited liability. Given that this is a state regulated entity, you will need to check with your particular state where you want to form the LLC in order to find their specific state statutes.

Corporations, offer limited liability as well and have been around for a very long time and are a state entity. Again, you will need to find out the necessary filing statutes in the given state you wish to incorporate, in order to have a valid corporation. Institutional investors prefer corporations due to the long history of litigation. Corporations have established more case law over all of the relevant business entities.

Partnerships cover an association of two or more persons to carry on as co-owners of a business for profit and fall under both state law and common law statutes. This is a limited partnership, which means an entity, having one or more general partners and one ore more limited partners.