Legal Forms: Limited Liability Companies/Partnerships

Limited Liability Companies and Partnerships

Definition: Separate legal entity created by Ohio statute that combines both corporate & partnership attributes

Key Points

  • Formed by one or more “members” who manage the LLC
  • Must file articles of organization with the Ohio Secretary of State
  • As a separate legal entity, it can sue & be sued

Advantages of LLC

  • Can have unlimited number of members
  • All members of LLC have limited liability
  • There is no restriction on types of members (i.e., corp, partnership can be a member)
  • LLC is considered a “pass through” entity for federal income purposes, meaning the entity does not pay taxes
  • Can have more than one broker affiliated with an LLC; salespersons & non-licensed persons can be a member

Disadvantages of LLC

  • Because it is a separate legal entity, governing documents must be prepared by an attorney & filed with Secretary of State
  • If there is only one broker affiliated with the LLC, the business must cease upon death of that broker or suspension of his license