LLCs: How to best protect your business assets

If you are the owner of a closely held business, structuring your business as an LLC gives you greater legal and tax flexibility and stronger statutory asset protections than any other business organization form, including corporations.

Attorney John Cunningham focuses his LLC practice on crafting LLC operating agreements that provide the strongest possible statutory asset protections for clients. As the principal author of Drafting Limited Liability Company Operating Agreements, a leading U.S. formbook and practice manual, he is a nationally respected expert on LLC formations and LLC law and tax.

Combined benefits of LLC protections and section 199A deductions

Properly structured LLCs can take advantage of Internal Revenue Code section 199A tax deductions of 20 percent or more of business income. John is a nationally recognized expert in section 199A deductions, giving him a rare combined expertise that is particularly beneficial to clients seeking both strong asset protection and maximum tax deductions for their businesses. Only an attorney with an in-depth understanding of both LLCs and section 199A—and how each can significantly impact the other—can provide one-stop services to clients needing this dual expertise.

Under the LLC acts of California, Delaware, Massachusetts, New Hampshire and other states, John has formed hundreds of LLCs, with initial capitalizations ranging from a few thousand dollars to $600 million and with memberships ranging from one member to over 100. He also has handled numerous statutory conversions of business corporations and other non-LLC entities to LLCs and has represented many clients in conflicts between LLC members and managers.

Comprehensive LLC services

LLC formations and operating agreements

John advises clients about whether LLCs are the best entities for them. If an LLC is the right choice, he forms LLCs and drafts operating agreements for clients. Operating agreements for single-member LLCs are typically short and simple, but operating agreements for multi-member LLCs sometimes must be lengthy and complex.

A multi-member LLC is similar to a marriage in that serious disputes can jeopardize relationships among members and lead to litigation. A well-written LLC agreement can resolve these issues in advance, providing clients with asset protection from fellow LLC members and third parties.

In forming LLCs, John’s goal is to provide the best possible tax structure and the maximum possible asset protection for a client’s personal, family, and business assets, including protection for their LLC memberships.

LLC operating agreement reviews

If a client requests, John reviews LLC operating agreements drafted by other attorneys and revises these agreements to best meet the client’s needs, including working to maximize the client’s section 199A tax deductions.

Other LLC transactions

In addition to forming LLCs and drafting LLC agreements, John handles all other types of LLC transactions, such as the sale and purchase of LLC memberships and assets, as well as LLC dissolutions.

Conversions of non-LLC entities to LLCs

When useful to enable clients to maximize their section 199A deductions, John assists clients in converting their business corporations to LLCs.

Internal LLC disputes

If internal LLC disputes arise, John represents LLC members and managers.

Dual expertise benefits clients

John is one of the few lawyers with substantial knowledge and experience in both LLCs and section 199A deductions. Maximizing Section 199A deductions is key for all LLC members, and many business owners can maximize their section 199A deductions only through the sophisticated use of LLCs. John’s expertise in both areas enables him to provide services to clients that need both LLC advice and section 199A advice. An initial consultation is free.