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Monday, February 11, 2013

Limited Liability Company Potpourri (I hate the smell of potpourri, but I like the word.)

Finally, the Author can dig in to legislative proposals that directly affect Indiana small businesses and small business law. Several proposals, some housekeeping, some material, to the Indiana Liability Company law, Ind. Code 23-18.

Of course we know that the LLC is the dominant small and sometimes large business organizational model. It combines limited liability with the benefits of “pass through” tax treatment. Millions of businesses can file their taxes on a Schedule C.
WHERE DID THIS GREAT IDEA COME FROM?

It seemed to the Author that LLC’s came from nowhere. It was 1993 or 1994, and there they were. Out with the S-Corp forms, in with the LLCs. The first state to pass an LLC law was Wyoming in 1977. The Author does not think of Wyoming as a leader in anything, except range wars, shot-up road signs, and density of cattle per acre. And no, The Wyoming Legislature did not invent them.
The Author went online and expected to find that LLCs were the brainchild of some leading American corporate law professors and some model acts from the 1960s. Nope, nothing like that. The LLC, with only a slight American gloss, came from that socialist paradise that the Club for Growth calls Western Europe.

The LLC, then known as Gesellschaft mit beschrnkter Haftung, was invented in Germany in 1892. After this, LLC laws were passed in Europe, then later in South and Central America. 
The Indiana LLC laws were enacted in Indiana in 1993, only 101-years late, long before Daylight Savings Time.

STAY TUNED
The Author will hit some of the LLC proposals over the next few days.

As always, contact me with questions, comments, or to demand retractions that will never be made.

 

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