State of formation, tax election, registered agent — the choices with lasting consequences, minus the boilerplate.
Formation paperwork is mechanical. These six decisions are not, and reversing them later is expensive.
State of formation
Home-state registration is usually right for operating companies; Delaware remains useful for venture-backed ventures planning institutional investment.
Tax classification
A single-member LLC defaults to disregarded; a multi-member LLC defaults to partnership. S-corporation election can save self-employment tax for profitable owners — run the numbers before electing.
Registered agent
Use a professional agent if you move or travel. A missed service of process becomes a default judgment more often than anyone admits.
Management structure
Member-managed versus manager-managed sounds academic until a hiring or financing decision splits the group.
Capital accounts and distributions
Define whether distributions follow ownership percentages or something else, and what happens when cash is tight.
Transfer restrictions
Right of first refusal provisions prevent an unexpected inheritor from becoming your new business partner.
Get these six right and the default rules can carry everything else.
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