How do you set up a business in Florida – Part 6: The benefits of the LLC
The likely primary reason why the LLC has become the dominant business entity in Florida is the relative ease by which it can be managed. Our LLC laws do not require that the owners, who are either managers or members, necessarily have a written operating agreement between them, but without such governing document, the owners are essentially stuck with what the Legislature has given them, which may or may not be what they desire or intend. While the LLC is governed by an operating agreement or Chapter 605, which is Florida’s LLC laws, the governance documents used in a corporation, which is designated by “Inc.”, are bylaws and a shareholder agreement. Thus, two separate documents are required for the corporation whereas only one is needed for the LLC and the cost to the business for these is then cut in half with the LLC.
While governance documents for a Florida business, such as an operating agreement for an LLC, bylaws and a shareholder agreement for a corporation, and a partnership agreement for a partnership, enhance and guide the internal operations of the business between the “partners” in common parlance, the business can also enhance its own value and add protection to its brand through trademarks or service marks. The State of Florida has its own trademark statutes that complement the Federal trademark laws, but the Florida trademark and service mark is far less costly than a Federal mark. For start-up businesses that only plan to operate in Florida or intend to initially do so, the Florida trademark may be of great value and benefit, which is a common discussion topic between new business owners and Mr. Steinfeld in consultation meetings.