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Maryland Limited Liability Companies (LLCs): Frequently Asked Questions

The Kramer Law Firm specializes in the formation and corporate governance of LLCs. For many businesses, an LLC is the most beneficial form of organization.

What is an LLC?
A limited liability company (LLC) is a statutory business organization. LLCs are called limited liability companies because an LLC confers limited liability on its owners (members).

An LLC is considered a separate legal entity from its members. This makes the LLC liable for any acts of negligence, and shields its members from personal liability for claims against the LLC. The individual members' personal assets are protected.

Are there any other advantages to forming an LLC?
An LLC is a simple and flexible business entity. Because the LLC Act allows for flexibility in organization, an LLC can be structured in the way that best meets the needs of a particular business.

  • LLCs must have one member, but an LLC may have multiple members. There is no upper limit on the number of members.
  • Management of an LLC may be done by members or by hired managers. It is up to the members to decide which structure best fits the needs of their business.
  • An LLC does not require directors, officers, by laws, or stock certificates.
  • Members of LLCs have broad contractual freedom. Nearly all the rules in state LLC acts which govern members and managers are default rules that members may alter when forming their own LLC agreement.

What kinds of business can be conducted by an LLC?
LLCs may be used to conduct every type of business except for those barred under the applicable state LLC act. Generally, LLCs may not be used for banking, utilities and for certain trust activities.

LLCs are also used for charitable organizations and other non-profits. LLCs may be formed solely for the protection of business assets. They may also be formed by individuals or families for the protection of estates and personal wealth.

How can The Kramer Law Firm help to start an LLC?
At The Kramer Law Firm, the formation and management of LLCs is our forte. If you are starting a business, we can help you determine if an LLC is the most advantageous form of organization for your business, or if another business entity such as a sole proprietorship, general partnership, limited partnership or corporation would be more beneficial. We can also help you determine the most favorable jurisdiction for your new business.

If an LLC is the best option for you, we can help structure the LLC to minimize federal, state and Social Security taxes. We can draft an LLC operating agreement to ensure that the on-going governance of the LLC is consistent with the company's objectives. We can help anticipate future problems and plan for the protection of assets.

With our legal help, you can focus on building your business.

My current business is not an LLC. Can I convert to an LLC?
Yes. The Kramer Law Firm regularly performs the conversion of existing non-LLCs to LLCs. Our corporate governance lawyer can help you determine whether converting your company to an LLC is the best way to protect your company's assets and to promote future growth.

Contact The Kramer Law Firm to learn more.



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The Kramer Law Firm LLC represents small business clients throughout Washington, D.C. and Montgomery and Prince George's Counties in Maryland, including the communities of Bethesda, Bowie, Chevy Chase, Gaithersburg, Germantown, Laurel, Potomac, Rockville and Silver Spring and all of the surrounding areas.

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