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Changes in Tax Laws and Business: Is an LLC Still the Right Structure for You?


4/16/14

Fifteen years ago, tax law changes encouraged the utilization of Limited Liability Companies (LLCs) and, as such, many construction companies chose to operate their businesses as LLCs. However, times have changed – and so have tax laws, operations, and the business environment. In fact, on March 1, 2014, New Jersey passed legislation that changes some of the rules and regulations that effect the operations of limited liability companies in the state. While none of the actions and provisions set forth below are in and of themselves necessarily earth-shattering, they offer construction company owners an opportunity to reflect on the current state of their businesses and offer more reason to evaluate the direction they have taken over the last 15 years. In light of continuous tax law change, now is a great time for construction company owners to review their business’ status as an LLC and whether or not an LLC structure is still the most effective way to operate. It also provides a great opportunity to re-evaluate your estate and succession plans.

What Does CohnReznick Think?
It is important for businesses to collaborate with their trusted advisors, attorneys, accountants, and insurance agents to review their current business and family plans compared to where they were when the entities were initially formed and to determine whether value-added modifications are in order.

Click here to access the CohnReznick alert outlining the New Jersey LLC tax law changes.

Contact

If you have any questions related to entity structure, please contact Jack Callahan, Partner and Construction Industry Practice Leader, at 732-380-8685.

To learn about CohnReznick’s Construction Industry Practice, visit our webpage.


Circular 230 Notice: In compliance with U.S. Treasury Regulations, the information included herein (or in any attachment) is not intended or written to be used, and it cannot be used, by any taxpayer for the purpose of i) avoiding penalties the IRS and others may impose on the taxpayer or ii) promoting, marketing, or recommending to another party any tax related matters.

This has been prepared for information purposes and general guidance only and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is made as to the accuracy or completeness of the information contained in this publication, and CohnReznick LLP, its members, employees and agents accept no liability, and disclaim all responsibility, for the consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it.

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