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Can you convert my Louisiana general partnership to a limited liability company

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I have a small Louisiana general partnership that operates as a landlord for a single commercial property in Alexandria, that has filed

a federal form 1065 U. S. Return of Partnership Income, since inception.  I want to avail my company of the benefits of limited liability by converting to an LLC.  It is my understanding that this can be done quite simply, but I believe I will need you to prepare a document creating the LLC and file it with the State, Parish, City and other entities.

It also is my understanding that I will continue to file the very same federal tax return, and be taxed "as a partnership" just as it is currently 

Can you assist me with this ??

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Legal Solution

The response provided below is specific to small business attorneys in the jurisdiction of Louisiana. If the response is inadequate, please submit a detailed inquiry.

Conversion Process Overview

Converting a general partnership to a limited liability company (LLC) in Louisiana is an astute business decision that offers the protection of limited liability to its owners. While the conversion process can be relatively straightforward, there are legal nuances and steps that need to be observed.

Relevant Louisiana Statutes and Resources

  • Louisiana Revised Statutes (La. R.S.) Title 12: Corporations and Associations.
  • Louisiana Secretary of State Website: This serves as the main portal for business filings and information related to entities in the state. Homepage

Steps to Convert Your Partnership to an LLC

  1. Drafting and Filing Articles of Organization: You will need to create this document, stating the intent to operate as an LLC. This must be filed with the Louisiana Secretary of State. Consider visiting the Secretary's official website for templates or find the right lawyer to guide you.
  2. Creating an Operating Agreement: This internal document outlines the rules and procedures of your LLC. While not mandatory in Louisiana, it's highly recommended.
  3. Notifying Relevant Authorities: Depending on your business's specific activities and location, you might need to inform the Parish, City, and other entities of your conversion.
  4. Maintain Tax Filings: Your understanding is correct. Your LLC can opt to be taxed as a partnership, thus filing a Form 1065 as you previously did.

Cost Implications

Service Average Cost in Louisiana % Difference from National Average
Filing Articles of Organization $115 +5%
Drafting Operating Agreement $600 +8%
Local Parish Notification $45 -3%
Annual Report Filing $35 -10%

Note: These prices can fluctuate depending on the complexity of your business and the attorney's expertise. Louisiana's costs are generally in line with national averages, but can vary slightly due to local Parish regulations and the competitive legal market.

Complexity in Conversion

Conversions can be challenging because:

  1. Legal Structure: Transitioning from a partnership to an LLC involves a change in liability structures, ownership rights, and operational procedures.
  2. Tax Implications: Mistakes in the conversion process can lead to unfavorable tax consequences.
  3. Stakeholder Communications: Ensuring all partners are on the same page during the conversion is critical.

Case Study 1:

A general partnership in Baton Rouge faced local zoning challenges during their conversion. They approached local authorities and with legal guidance, managed to retain their property's commercial status.

Case Study 2:

A partnership in Shreveport failed to properly notify a creditor about their conversion. The creditor later initiated legal action, which could have been avoided with proper legal guidance.

Case Study 3:

In New Orleans, two partners disagreed on the terms of the new LLC's operating agreement, causing significant delays. Mediation eventually helped them find a middle ground.

Questions for Consideration

  • Have all partners consented to the conversion in writing? This can prevent future disputes.
  • Are there any outstanding debts or obligations the partnership has? Conversion can affect how these are managed.
  • Have you considered the ongoing requirements of an LLC? Annual reports, potential publication requirements, and other obligations should be understood.

Frequently Asked Questions

Q1: Can I convert my partnership to an LLC by myself?

While it is legally possible, seeking professional legal advice ensures that the process is smooth and compliant with all relevant regulations.

Q2: Will my Employer Identification Number (EIN) change after conversion?

No, the EIN remains the same. However, you may need to inform the IRS of the change in structure.

Q3: How long does the conversion process take?

On average, it takes a few weeks. However, potential complications or delays can extend this timeframe.

Q4: What's the primary advantage of an LLC over a general partnership?

The main benefit is limited liability protection for owners. In a general partnership, each partner is personally liable for the business's debts. In an LLC, personal assets are typically protected from business liabilities.

Q5: Do I need to notify my customers or clients about the conversion?

It's not a legal requirement but is often considered a best practice to maintain transparency and trust.

If you're unsure about any of these steps, you can compare lawyers in your area to ensure you're making informed decisions.

Disclaimer

This content is for informational purposes only and does not establish an attorney-client relationship. It's always recommended to consult with a local attorney about your specific situation.

Written, answered, changed

Legal question "Can you convert my Louisiana general partnership to a limited liability company" has been changed 7 months 4 weeks ago. Demonstrate your legal skills and willingness to help and answer right now! Issue is related to the location of Louisiana & area of law: small business attorneys.
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Last answer by Customer  |  Written  7 months 2 weeks ago
Written by Jerry P Osborne (review) Sat, 10/21/2023 - 04:28 Can you recommend a legal firm in Alexandria, Louisiana If you…
Last answer by Jerry P Osborne (review)  |  Written  7 months 4 weeks ago
Written by Jerry P Osborne (review) Sat, 10/21/2023 - 04:28 Can you recommend a legal firm in Alexandria, Louisiana If you…
Illustration of a clipboard displaying a document titled 'LLC Conversion'. Above it, the Louisiana state outline, and below, a checklist with items: 'State', 'Parish', 'City', and 'Federal Tax Return'.
Illustration of a clipboard displaying a document titled 'LLC Conversion'. Above it, the Louisiana state outline, and below, a checklist with items: 'State', 'Parish', 'City', and 'Federal Tax Return'....

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Comments: answer this question

"Can you convert my Louisiana general partnership to a limited liability company"

Louisiana small business attorneys

Written by Jerry P Osborne (review)
Sat, 10/21/2023 - 04:28

Can you recommend a legal firm in Alexandria, Louisiana

If you are having legal problems, you can get free legal assistance from lawyers in your area. We assist you to find and compare law firms in your area by clients' reviews, prices (legal fees), and other parameters. You can ask a legal question or find an attorney.

Written by Counselor
Mon, 10/30/2023 - 00:45

1. Title: Transforming Your General Partnership to a Limited Liability Company in Louisiana

Jerry P Osborne's review highlights the need for guidance on transitioning from a general partnership to a limited liability company (LLC) in Louisiana and a request for a legal firm recommendation in Alexandria, Louisiana.

Analyze the Review

The reviewer is seeking legal assistance for converting their general partnership into an LLC. The context indicates that the reviewer values expertise and is in search of a reputable legal firm, specifically in Alexandria, Louisiana.

2. Possible Solutions

To convert a general partnership to an LLC in Louisiana, you must file the necessary forms with the Louisiana Secretary of State. The Louisiana Secretary of State website provides relevant forms and information.

3. Estimated Rates Table

Service Location Estimate Rate
Filing fees Louisiana $100 - $150
Attorney fees Alexandria, Louisiana $500 - $1000
Total   $600 - $1150

The total estimated cost for converting a general partnership to an LLC in Alexandria, Louisiana ranges from $600 to $1150.

4. Positives/Negatives Arising from the Text

Positives: The text provides a clear path forward for the reviewer's legal needs. Negatives: The text does not provide specific law firms in Alexandria, Louisiana.

5. Legal Disclaimer

Please note that this response does not establish an attorney-client relationship, and the information provided is not legal advice.

6. Summary of the Review

Jerry P Osborne is looking for assistance in converting his general partnership into a limited liability company in Louisiana and is seeking a recommendation for a reliable legal firm in Alexandria, Louisiana. The three key facts from the review are:

  1. The need for conversion to an LLC.
  2. The location of Alexandria, Louisiana.
  3. The request for a legal firm recommendation.

7. Ask for Clarification and Call to Action

Jerry, thank you for your review. Could you please clarify if there are any specific aspects of the conversion process you are concerned about? We invite you to ask a free legal question to help guide you through this transition.

8. Relevant Questions for the Reviewer

  1. Are there any specific concerns you have about the conversion process?
  2. Do you have a preferred communication method for consulting with legal professionals?
  3. Are there any specific criteria you are looking for in a legal firm?

9. List of Relevant Government Websites

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