When starting a company, one will need to decide how they will want to structure it. There are several business structure options to choose from, including a corporation, a limited liability partnership (LLP), and a sole proprietorship. An LLP is a popular choice because it allows for all of the owners, known as partners, to enjoy limited liability while not giving up any rights to run the company. Rather, all partners have the right to share in managing the company, even though they are only liable for the investment that they have made to the LLP. To function as an LLP in Pennsylvania, the company will need to register as an LLP with the Pennsylvania Department of State’s Bureau of Corporations and Charitable Organizations.
What Are the Requirements for an LLP?
In order to establish a company as an LLP in Pennsylvania, one must make sure that a number of requirements are met. The state requires an LLP have a name that contains “company,” “limited”, “limited liability partnership,” or an abbreviation of one of these words at the end. Another task that an LLP must accomplish is establishing an office in Pennsylvania where official documents intended for the LLP may be sent. If the company LLP is a foreign LLP, meaning that it is an LLP established in another jurisdiction, then the office it has in Pennsylvania must be a registered office. Additionally, an LLP needs to file paperwork in order to be officially registered as such.
What Paperwork Do I Need to Form an LLP?
You can file the mandatory paperwork with the Bureau of Corporations and Charitable Organizations by mailing in the paperwork or by filling it out online. A domestic, or non-foreign, LLP must file a Statement of Registration Domestic Limited Liability Partnership. You can complete this form by providing the LLP’s name and office address, indicating that the company is an LLP, indicating when you want the registration to become effective, and including a signature from one of the LLP’s partners.
All foreign companies, including foreign LLPs, have to fill out a Foreign Registration Statement. To properly fill out this form for a foreign LLP, you will need to indicate that the form is for an LLP. You will also be required to give the LLP’s original name, another name for the LLP if the original name does not meet the requirements, the jurisdiction where the LLP was formed, the address for the LLP’s principal office, and the address for the LLP’s registered office. Finally, you will need to indicate when you will want the LLP to be effective and sign the form.
What Benefits Does Pennsylvania Give to an LLP?
The state does offer a number of financial benefits to companies. For example, there is the Community-Based Service Credit, which provides a tax credit to businesses that make contributions to nonprofits focused on disability or mental illness. Also, the filing fee for a company is waived if the company is owned by a military reservist or a military veteran.
What Disadvantages Does Pennsylvania Give to an LLP?
Pennsylvania requires all LLPs to file a Certificate of Annual Registration that is due by April 15th each year. The filing fee associated with the annual registration is $350 times the number of partners in the LLP, which is quite high.
Should I Hire a Business Lawyer?
It is important to carefully adhere to all of the requirements when registering a company as an LLP because a single mistake can result in your company not becoming an LLP. Thus, you should reach out to a Pennsylvania business lawyer for assistance because they can guide you through the process and help you avoid any pitfalls.