The Close LLC is designed with small businesses in mind. The Wyoming LLC Act allows close companies to sidestep onerous formalities while otherwise keeping the benefits of a Wyoming LLC. Generally, the designation is for single-member LLCs and for when members are close to one another, i.e. family and close friends.
The unique relationship between members results in the Close LLC being allowed to operate with fewer bureaucratic hurdles - somewhat akin to a partnership. Close companies may also be used to enhance asset protection and for estate planning purposes. Those benefits are discussed further below. Note, this entity is sometimes referred to online as a "Closed LLC". However, there is no "Closed" designation - only "Close".
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Close LLC Benefits
Wyoming LLC Benefits
Close companies have desirable benefits and are becomingly increasingly popular among small businesses. Be aware of potential disadvantages, though, which include:
The Internal Revenue Service considers Close LLCs to be regular LLCs. The default taxation is as a pass through entity. You may also elect for either "C-Corp" or "S-Corp" taxation if you prefer.
Wyoming Close Corporation
Wyoming's close designation is not limited to the limited liability company. You may also form a close corporation in Wyoming. The benefits of a Close Corporation are more marked only because the operating requirements of a corporation are more onerous to begin with. Corporations in other states can be required to not only hold quarterly meetings, but to keep copies of the records at their place of business. For times when a c-corp is required, regulations such as those just mentioned make a Wyoming Close Corporation that much more appealing.
Close Wyoming LLC Summary
We encourage our clients to form close LLCs whenever feasible. Their reduced complexity comes with little if any trade off for most. They are also ideal for subsidiaries of holding companies where holding an annual meeting for each would be superfluous. Learn more about Wyoming LLCs here.