Do I need an attorney for my LLC?
Am I required by law to employ an attorney to form an LLC?
No, an attorney is not required by law and you can form an LLC without hiring an attorney.
Can I file the necessary forms without the help of an attorney?
The LLC construction was created with the small business owner in mind and the required paper work is therefore fairly straight forward. In most states, you will only need an Operating Agreement and Articles of Organization / Certificate of Formation. If you find it complicated you can always hire an attorney or some other type of legal expert to do it for you, but many prospective business owners have formed LLC’s without any help.
Do I need an attorney to take care of maintenance work?
As mentioned above, the LLC construction was made for small scale businesses and the amount of obligatory paper work has therefore been kept down to a minimum. In most cases, you only have to fill out a one page annual statement and pay an annual fee. Most business owners can do this on their own without hiring an attorney.
Do I need an attorney to deal with the IRS?
You are not obligated by law to hire an attorney to handle your taxes, but many LLC’s do this anyway since taxation can be complicated even for a small business. Hiring an attorney is viewed as a way of safeguarding against costly mistakes.
It is also common for LLC’s to hire an attorney to look over their business and make sure that it adheres to current legislation and IRS principles for LLC’s. The reason for doing this is that the IRS can decide to tax your business as some other form of corporation than an LLC if the business does not comply with principles and legislation. Loosing the typical LLC taxation and instead being taxed like a C Corporation or similar can cause severe financial problems.
In most states, you will find four “corporate characteristics” listed in the IRS guidelines. As long as your LLC does not have more than two of these characteristics, the company will be taxed as an LLC. If you company exhibits three or four of these characteristics, it risks being taxed as a corporation. Fully understanding the four corporate characteristics and knowing how they can be avoided can be difficult and hiring a legal expert can therefore be a good idea if you feel unsure.
Are there any alternatives to hiring an attorney?
Yes, attorneys are not the only ones capable of helping LLC’s with legal matters. You can for instance contact an incorporation service, since they are experts on various types of company law and regulation. They can also be hired to serve as your registered agent instead of your attorney. It is always a good idea to compare the cost of several different incorporation services and attorneys before you make any decision, since they vary quite a lot.
