New Jersey Statutes Limited Liability Company Act

By Joseph Scrofano

New Jersey permits business owners to form limited liability companies, or LLCs, and any substantive legal issues relating to LLCs are governed by state law. The New Jersey Division of Revenue enforces the laws surrounding the formation and dissolution of LLCs in the state. While many states LLC laws share similarities, certain requirements are unique to New Jersey.

Name

Like most states, the New Jersey Limited Liability Company Act prohibits LLC organizers from forming an LLC with the same name as another registered business entity in the state -- unless the LLC organizers obtain written consent from the business. An LLC in New Jersey must contain the phrasing “Limited Liability Company” or the initials “LLC.”

Certificate of Formation

Under the New Jersey LLC Act, one or more persons who have authority to organize the LLC must file a Certificate of Formation with the New Jersey Department of Revenue. In this filing, the organizers must include the name for the LLC, whether the LLC will dissolve on a certain date, and the LLC’s registered agent’s name and address. A registered agent is someone the LLC grants authority to accept important mail like correspondence with the state and other legal notices. The Certificate of Formation must also state that the LLC has at least one member.

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Other Issues

An operating agreement sets forth the rights and responsibilities of the individual members. It sets policies for the management and operation of the company, as well as the members' voting rights and initial contributions. New Jersey law does not require that LLC members file an operating agreement with the Department of Revenue. For tax purposes, New Jersey LLCs are usually treated like partnerships where the gains and losses from the LLC “flow through” to the individual members’ personal tax returns. However, in some cases, LLC members can elect to be taxed as a corporation or sole proprietorship. New Jersey LLCs also limit the personal liability of individual members in most cases.

Dissolution

The New Jersey LLC Act only allows members to dissolve an LLC under certain circumstances. If the members state the LLC will dissolve on a certain date in the Certificate of Formation, the LLC will dissolve on that date. If the members list -- in the operating agreement -- specific events that will trigger dissolution, then the LLC's members may dissolve the LLC if such an event occurs. All members may provide written consent to dissolve, or a court may order the LLC to dissolve. Finally, if the LLC loses all of its members -- to retirement, death or otherwise -- then it will automatically be dissolved within 90 days of losing all members, unless it acquires at least one new member during that time.

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What Happens When a LLC Dissolves?

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California LLC Laws

A California limited liability company (LLC) is a type of business in which the owners, who are called members, have only a very limited personal liability for any company debts or court judgments against the company. Limited liability companies can also offer tax advantages for members such as allowing members to report the LLC's profits and losses on their personal tax returns. In California, LLCs are governed by the laws in the California Corporations Code.

What Does an Automatic Dissolution of an LLC Mean?

An LLC, or limited liability company, is a business structure that protects the owners, known as members, from personal liability. In other words, should the company fail to pay its debts, only the assets of the business are subject to collection activities initiated by creditors. However, as the term implies, protection from liability is limited. Certain events can trigger an automatic dissolution of the business entity, possibly placing the personal assets of its owners at risk.

Illinois LLC Operating Agreement

Illinois state statutes 805 ILCS 180 Limited Liability Company Act Sec. 15-5 defines the operating agreement as the agreement concerning the relations among the members, managers, and limited liability company. Illinois statute permits, but does not require, the members of an Illinois limited liability company to enter into an operating agreement. If created, the operating agreement can generally contain any terms and conditions that do not conflict with the Illinois Limited Liability Company Act.

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