An LLC in Missouri- Why One is Necessary for Small Business

by Alan Alba

Starting a new business is exciting because it is not only a way to do something you love but is also a path to financial freedom. So, if you are thinking of starting one, you are on the right track.

However, there are some risks to starting a Missouri business. One effective way to significantly reduce those risks is to create an LLC in Missouri to operate you your business.

The law that allow for a MO LLC is one of the most business friendly laws available. The major benefit is liability protection for business owners but the lawmakers went even further to encourage small business by providing other benefits.

CREATE AN LLC IN MISSOURI FOR PERSONAL LIABILITY PROTECTION

Without the use of a limited liability entity such as a MO LLC, you would be operating as a sole proprietor. In this case, everything you own or might own in the future is at risk for being lost in the event your business becomes liable for obligations or involved in a lawsuit.

Any business requires that you interact with other persons or businesses. You may need to hire employees or retain contractors. Other examples include the need to deal with suppliers, banks, governments, professionals and other businesses.

Each time there is an interaction, there gives rise to activity which could later become the basis for a claim. Before the MO LLC, the only alternative to manage this risk was to incorporate and many business owners opted not to use a corporation due to the complexity of that type of legal entity.

This changed when Missouri lawmakers enacted the Missouri Limited Liability Company Act. Now, if you create an LLC in Missouri, the law protects your from being personally liable for the liabilities of the business just because you are an owner.

The benefits of an LLC in Missouri is made very clear by researching the number of formations that have taken place. The formation of this legal entity grows in number every year and is now the entity of choice for Missouri small business.

AN LLC IN MISSOURI IS AN EASY TO MAINTAIN AND FLEXIBLE OPERATIONAL VEHICLE

The Missouri lawmakers also wanted to free up any burden on business owners with extraneous legal compliance matters. As a result, an LLC in Missouri is not required to meet many of the obligations imposed upon the MO corporation. A Missouri limited liability company is not required to have a board of directors or to hold annual member meetings.

Now, another benefit is that if a business requires some complex structuring to accommodate business ownership or other goals, the Missouri limited liability company is allowed to create its own ownership and management structure as it sees fit.

Basically, the way the LLC laws work allow a company to operate the way it wants or needs to be managed without having to fit into any irrelevant legal structures.

FILING FEES ARE AFFORDABLE FOR A MO LLC

Missouri has also agreed to keep filing and registration fees low for a MO LLC. Presently, the filing fee is $105 for a standard filing. As you can see, these costs are minimal for obtaining the blanket liability protection . It is a very cheap insurance policy for one but the LLC in Missouri also provides other advantageous features to help you build your business and keep more profits.

OTHER ADVANTAGES OF AN LLC IN MISSOURI

When starting a business in Missouri, a Missouri LLC can help in other areas as well. For one, it provides an official and trustworthy image for your new business which makes getting customers easier. Customers view legal entity businesses as more credible and professional.

Another feature is the choice of taxation structure. First, a MO LLC automatically qualifies for pass through taxation which means income is only taxed once. This is preferred by most any small business because they are able to avoid the double tax of C corporations.

However, if a particular LLC company could benefit from being taxed under corporate tax rules, it has that option. Always check with your accountant before electing a different tax treatment, but know that you have these options for your limited liability company.

In conclusion, an LLC in Missouri is the first step toward providing yourself and other owners with protection and tax leverage at the beginning of a business. This will become very important as you become more successful.

About the Author:
CLICK HERE for a COMPLIMENTARY Guide about an LLC in Missouri and a COMPLIMENTARY Name Check from Missouri Business Formation, provider of a Three Day LLC Formation backed by a compliance guarantee: http://www.MissouriBusinessFormation.com

Published by: Sarah Davidson on February 27th, 2009 | Filed under Legal



Leave a Comment

rss feed