Lawyers and Limited Liability Entities

Attached are the statistics for LLC’s in Wisconsin for December 31, 2010. 84% of the new entities formed in Wisconsin were LLC’s in 2010 with 10% as corporations. 5% were non-profits and the balance LP’s and LLPs. As of December 31, 2010, 59% of all entities now in Wisconsin were LLC’s with 38% corporations and the balance non-profits, LP’s and LLPs. Wis LLC Stats Dec 31, 2010

There are some excellent reference materials. The first is the Seminar for the ABA Tax Section from February 17,2010. It is entitled Impact of New Tax Rates of Entity Issues Moderated by Atty Tom Nichols of Meissner Tierney Fisher & Nichols of Milwaukee, Wisconsin. It shows what might happen to entity choice with what were proposed tax changes. Now that the existing tax cuts have been extended one must carefully review these materials. But there are several tax comparisons among entities that are still valid. Suggest anyone wanting to look into the tax reasons for one entity versus another review these materials.

There is an excellent checklist for forming LLC’s that was prepared by the ABA Section on LLCs, Partnerships aned Unincoporated Business Entities . It is available if you are a member of the ABA and join this section. I highly recommend it for serious students of business entities This checklist is outstanding.

On September 15, 2010, the State Bar of Wisconsin through its Inside Track published an article I co-authored with my colleauge Attorney Jennifer Knudson entitled “Choosing a limited liability entity: Which form is best for your law firm?. It highlights the various options for lawyer including LLC’s. Note the specific requirements for Wisconsin lawyers includes: registration with the state bar; purchasing a minimum level of malpractice insurance; and client notification.

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