Limited Liability Company

 

Virginia lawmakers passed The Virginia Limited Liability Company Act (the "Act') in 1991. This law is located in Title 13 of the Virginia statutes and it generally known as one of the most small business friendly set of laws in Virginia.

The State of Virginia historically has favored this type of legislation. Forbes magazine regularly rates Virginia as #1 in enacting laws which support the creation and maintenance of businesses.

The Virginia Limited Liability Company Act is broken down into Articles and covers major matters such as formation requirements, relationships between and among members, financial matters, and dissolution.

Important Virginia LLC Formation Requirements

The Act makes the forming an LLC in Virginia pretty self explanatory, and the rules are very well defined. It's vital that business operators follow the rules and regulations in order to avoid losing LLC rights and privileges.

The Act sets forth a list of mandatory information disclosures. The two areas to focus on include appointing a valid Virginia registered agent and including an LLC name which is available and will be accepted as part of your filing. The name cannot be the same as or too similar to another name registered in the state.

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Liability Protection for Owners of a Virginia LLC

You also need to know about the liability protection law. Limited liability protection is why most Virginia business owners choose a Virginia LLC to operate their business. Section 13.1-1019 says that no LLC owner has a personal obligation for the liabilities of the LLC, regardless of how those liabilities happen, just because they are part of the company.

Absent the protection of LLC limited liability provisions, the business owner is personally responsible for all debts and other liabilities incurred by his/her business. As a business owner in this situation, you place all of your personal assets at risk. Since you can form a Virginia LLC for a low cost and this legal entity is quite easy to maintain, it makes no sense for you to risk your personal assets when the option of an LLC is available to you.

In Article 5 of the Act you will find important information regarding operating agreements and matters of management. Article 5 sets forth the rules regarding your duties as the manager of a Virginia LLC.

When the Virginia legislature enacted the Virginia Limited Liability Company Act, its goal was to encourage entrepreneurs to start new businesses in their state.

In addition to protection, a Virginia LLC offers major tax benefits, flexibility when it comes to ownership and management and it facilitates the raising of capital.

Click Here For a FREE Guide and More Details about Forming an LLC in Virginia