There are varied types of methods under which you can register your company. Amongst of which private firm, public company, sole proprietorship, limited liability company LLC , one person company, section 8 company are well popular in the corporate sector. Different company has different structure as per which it can decide its form of corporate. Similarly; different forms of corporate generally constitutes different rules and procedures for getting registration. Besides these; there is also a provision under which you can easily transfer one form of corporate to another; means if you have registered your company under sole proprietorship and need to convert into LLC then there is a provision in following which you can easily perform your task of converting a business into a limited liability company.
- Taxation benefits,
- Funds and Capital Issue,
- Partnership Agreement Matter,
- Management and Finance Issue
Or many more..
That can make able to convert his or her form of company into another form. Here, under this section we bring you with how to change a business to a LLC where you can enjoy the benefit of separate legal entity that's generally absence in prior one.
Steps / Procedure for Convert a Business to Limited Liability Company
- Get LLC form and fill an application for registration of an existing business. It is similar like when you register a new business.
- New LLC needs separate unique identification number where directors of an existing business need to apply for a new federal tax identification number that is popularly known by an EIN.
- Need to open new bank account with new EIN number for carrying proposed limited liability company transactions and close the previous bank accounts of existing business.
- Transfer all the assets, property, equipment, vehicle, real estate or other machinery to the new LLC that is separate legal entity where your personal belonging will not get included during the liquidation process. It is one of the unique features that generally absence in other forms of corporate.
- Alter all the insurance policies and other legal documents and certificates from exiting business to new limited liability company. So, that in case of any emergency you can reap out of it.
- Draft a new agreement under new proposed LLC, be ensure to alert your potential customers, suppliers other corporate associates, partners and clients in order to maintain your reputation and goodwill in the market.