Internet business getting LLC soon

**AcidRain0** · 06-22-2010 01:03 AM

I started an online marketing business with someone i've known many years on the internet. This person i've come to trust quite a bit, but i've never actually met them. We do everything 50/50, profit, losses, etc. We have not incorporated or gotten an LCC yet, but our business has been pretty successful within the last couple months and we are ready to take that step.

two questions: He has some experience filing LLC paperwork and wants to go ahead and do it in his state. If he does this, are there going to be any disadvantages to me? Will the business be registered in his name only?

my second question: incorporating and LLC are two different things, right?

**KyleXY** · 06-22-2010 01:38 AM

1. Depends. Which state are you both in? Anyone can file an LLC but not everyone does this properly. I would generally advise you two to seek an attorney to ensure it's done correctly and not just simply filing the basic registration. For that matter, also to help select the proper entity.

2. Yes, they are different.

**AcidRain0** · 06-22-2010 03:04 AM

im in PA and he's in TX. my question was mainly geared toward trying to find out if he can take things over and we wouldn't be 50/50 owners.

**KyleXY** · 06-22-2010 04:07 AM

Well if he's registering the business of course he can register it under his name alone. Obviously you would want this done correctly hence the reason I said have an attorney do it. This way it ensures there are bylaws created to reflect two owners and equal partnership. Also each member that have ownership is added to what's called the K1 schedule. If your friend has no clue on these basics step, he's in no position to do this. A simple registration won't do anything and worse case scenario he would include only his name on there. Even if he does register both your names, nothing specifies percentage of ownership through a simple registration.

BTW, neither of those states are that great for an online business but again, best to consult an attorney directly for advice for YOUR particular case.

**jonn655** · 06-29-2010 02:30 AM

And as far as investment is concerned, is the percentage of ownership related to the amount of investment? How does this criteria define a business partnership?