Ensuring business continuity should be given just as much thought as other business strategies, but it is often put off or overlooked. According to the U.S. Small Business Administration, less than 30 percent of small business owners have a formal succession plan. Given that 90 percent of U.S. businesses are family owned and less than 15 percent succeed to the third generation, the importance of a succession plan cannot be overstated.
The limited liability company (LLC) form of business organization is extremely popular and provides many advantages to its members. The benefits of this form of organization includes limited liability for its owners (known as members) and the avoidance of the double taxation which afflicts corporations. Members can also participate in the management of the entity without losing limited liability protection. With the large proliferation of this form of business organization across the United States the federal tax filing consequences of the LLC are also important to consider.