Nolo’s Guide to Single-Member LLCs Second Edition

Book Preface

It’s a great time to be the sole owner of a small business. That’s because changes in business laws have made the single-member limited liability company (SMLLC) an option in every state. In addition, when Congress passed the Tax Cuts and Jobs Act at the end of 2017, it included a new deduction for people who earn money through pass-through entities like SMLLCs. For SMLLC owners, the deduction could equal up to 20% of their SMLLC income.

This book will give you an overview of what is required to create and operate an SMLLC. The first chapter provides a general explanation of what an SMLLC is and why it may well be the best choice for your small business. Subsequent chapters cover things like formation, taxation, financing, protection from personal liability, and record keeping. Among other matters, this book will tell you:

• what forms and documents you need to create an SMLLC
• how to initially fund an SMLLC
• what your options are for managing an SMLLC
• how to prepare taxes for an SMLLC
• what forms and documents you have to file once your SMLLC is up and running
• what kinds of records you need to maintain for your SMLLC
• how an SMLLC will protect you in the event your business is sued
• what you need to do to maintain limited liability protection for your SMLLC, and
• what liability issues apply specifically to SMLLCs.
Throughout the book you’ll find tips, examples, and sample documents that help clarify the most important points.

This book strives to be both relatively compact and reasonably comprehensive. However, you may have additional questions or there may be issues specific to your situation that are not covered here. If so, you may want to consult with a legal or tax expert. Expert advice can help ensure that an SMLLC is the best choice for your business and that you have considered all the legal and tax issues that might apply to your particular situation. If you decide you want to form an SMLLC but you don’t want to do the paperwork and filings yourself, Nolo has an online LLC formation service that will take care of everything for you, including creating a customized SMLLC operating agreement.

Whether you have already taken the plunge and created your SMLLC or are still deciding whether an SMLLC is right for you, this book has all the essential information you’ll need about what it takes to form, own, and operate an SMLLC.