Before LLCs were legally able to be established, the practical ways to organize businesses was to establish either a corporation or limited partnership.
Limited partnerships are cumbersome to maintain are are confusing when compared to LLCs.
There can be some legitimate reasons for a new business to organize as a corporation instead of an LLC for tax purposes. When organizing a new business, caution should be exercised to be sure that the business is being established in the best way possible.
Entrepreneurs and small business owners tend to organize their operations through entities such as LLCs and corporations for practicality and liability protection reasons. Before LLCs were legally able to be established (before the early 1990s), the only practical entities to organize businesses were corporations and limited partnerships.
Limited partnerships have some value in asset protection but are cumbersome to maintain and confusing to administer, especially compared to LLCs.
Read Lee’s article about using caution with corporations in the Lima News here: Legal-Ease: Caution with corporations
Source: LimaOhio.com, “Legal-Ease: Caution with corporations,” by Lee R. Schroeder, January 26, 2019
Lee R. Schroeder is an Ohio licensed attorney at Schroeder Law LLC in Putnam County. He limits his practice to business, real estate, estate planning and agriculture issues in northwest Ohio. He can be reached at [email protected] or at 419-659-2058. This article is not intended to serve as legal advice, and specific advice should be sought from the licensed attorney of your choice based upon the specific facts and circumstances that you face.