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October 25, 2010
LLCs Taking Over?
The North Dakota Secretary of State's office provides a list (pdf here) of business entity statistics -- seven biennial histories -- for the years 1995, 1997, 1999, 2001, 2003, 2005, and 2007. I was curious how LLCs and for-profit corporation compared over the last two time periods, to see if the LLC explosion was a reality here in North Dakota. I'd say it is.
In 2005, there were 12,849 "Domestic (in-state) Chartered Corporations." In 2007, there were 13,211, which is a net increase of 362 corporations or an increase of 2.7%. As for in-state limited liability companies (LLCs), in 2005 there were 3362 LLCs; in 2007 there were 4833. This is a net increase of 1471 North Dakota LLCs, and increase of 43%. The growth pattern for LLCs is quite recent, and quite remarkable -- in 1995 there were only 366 LLCs (340 of which were new registrations).
If the rates from the last-reported biennium hold, LLCs will pass corporations as the North Dakota entity of choice by 2013. Not bad for an entity that didn't exist in the state until April 12, 1993.
--Joshua Fershee
October 25, 2010 in Government and Business, Musings | Permalink
Comments
The tax drawbacks of corporate status are well known In general it was worth paying the price to gain the advantage of limited liability, but lawyers were always looking for a better way to avoid the corporate tax negatives. Subchapter S was a clumsy and limited substitute, which didn't solve all of the problems; limited partnerships were even clumsier as vehicle for operating a business. In most cases the LLC is by far the best vehicle for providing limited liability with generally more favorable tax treatment.
Posted by: Arthur O. Armstrong | Oct 26, 2010 9:52:29 AM
, which didn't solve all of the problems; limited partnerships were even clumsier as vehicle for operating a business. In most cases the LLC is by far the best vehicle for providing limited liability with generally more favorable tax treatment.
Posted by: uk dress | Oct 28, 2010 5:45:37 PM
