In 1991, lawmakers passed the Virginia Limited Liability Company act. Also known as the Act, this law can be found in Title 13 of the state statutes and it’s now known as one of the most small-business-friendly statutes in all of Virginia.
Va has a history of passing favorable statutes and regulations to support the starting and growing of businesses. In fact, Virginia has consistently been rated #1 by Forbes magazine.
The Virginia Limited Liability Company Act is broken down into Articles and covers major matters such as formation requirements, relationships between and among members, financial matters, and dissolution.
Forming an LLC in Virginia- Key Formation Provisions
The Act makes the forming an LLC in Virginia pretty self explanatory, and the rules are very well defined. It’s vital that business operators follow the rules and regulations in order to avoid losing LLC rights and privileges.
Mandatory information disclosures are an important part of the Act. Pay particular attention to the rules involving the appointing of a valid Virginia registered agent and creating a name for your LLC. In order to be accepted, the name must be unique; if it is the same as - or even too similar to - another registered name in Virginia, it will be rejected.
Liability Protection with an LLC in Virginia
You also need to know about the liability protection law. Limited liability protection is why most Virginia business owners choose a Virginia LLC to operate their business. Section 13.1-1019 says that no LLC owner has a personal obligation for the liabilities of the LLC, regardless of how those liabilities happen, just because they are part of the company.
If there were not a provision such as this, Virginia LLC business owners would then be held liable for all debt and other business liabilities. As forming an LLC in Virginia is inexpensive, and maintaining it is easy, there is really no viable reason to risk any of the business owner’s personal assets, or to have them be liable at all.
Article 5 of the Act is also important for the new LLC business owner, not only because of the protection it provides to them, but because it addresses management issues and operating agreement matters. Here you can find what duties you have as a manager of a Virginia LLC.
When the Virginia legislature enacted the Virginia Limited Liability Company Act, its goal was to encourage entrepreneurs to start new businesses in their state.
Along with protection from personal liability, establishing an LLC in Virginia offers you as a business owner several other advantages. Creating a Virginia LLC will facilitate the process of raising capital for your business. You will also receive major tax benefits and the flexibility in ownership and management that will allow you to run your business as you see fit.
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