Filing my first LLC towards a wholesale business

[Jeremy Davis]

Hey BP,

I'm sitting here, stuck on pause, while filling out my first LLC here in Utah. Everything was going smooth, all questions easily answered, and then BOOM! They ask me for my BASIC nature/purpose of business, followed by DETAILED nature/purpose of business, and then followed by an even MORE DETAILED nature/purpose of business, all of which have a code associated.... It gives me drop down menus for each, followed by further definitions as I go down to the next drop down menu.

So I'm stuck. Would I be filing as "Wholesale Trade, Real estate/rentals leasing, education, information, professional/technical services, or "other"?

Thanks everyone

[Alan Taylor]

I would seriously consider going through an attorney experienced in real estate here, rather than a DIY filing.

If you're going through a DIY site, then the questions you are trying to answer are essentially taking a formulaic approach to creating the 'operating agreement' that will define your LLC.

Why go with an attorney?   

The operating agreement from a 'DIY' site will make you 'official', but it won't necessarily stand up in court -- especially if there is a slight mis-alignment  between the purpose of your business, and what is said in your LLC operating agreement.   Let's hope your company never faces litigation -- but in the unlikely event that you are up against a plaintiff with deep pockets and an iron-clad animus, their legal representation will be going through your Operating Agreement with a fine-tooth comb -- and going through a "DIY" site stands a high risk of leaving more 'chinks' in your armor than going through a real estate attorney. 

One more thing to consider -- if you plan on using your legal entity for a while, or if you are simply using it as a liability shield while you assign contracts, you might consider going through Anderson Advisors, and setting up a land-trust kit.  This might be something to consider down the road, as it's about $5,000 up front, but it streamlines a lot of the process where a double-closing might otherwise be needed.