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As you correctly noted an LLC is a very flexible structure and it allows you to assign various degrees of ownership and profit sharing.
when starting a new business it is the perfect opportunity to grant your children equity in the company. You can do it as following:
either assign yourself a small equity portion and a large profit share and assign them a larger equity portion and a small profit share. If you do that you would need to make sure that you retain management rights in the company so retain at least 51%
or you can do the above and designate yourself as a managing member and them as 'regular' members. You would also need to assign the managing member the necessary management rights to make sure that you retain control of the company until the time that you are ready to pass it on to them
this is done through careful drafting of the operating agreement of the LLC
If I control the LLC from a management standpoint as a managing member could I designate salary to myself along the way unless I don't want to receive anything?
I would really rather own about 1% but have control until I give it up. How do I keep control as the manager but not have the percentage control in the equity?
I presume it's a matter of drafting my powers as the managing member in such a way that it accomplishes what I'm after.
The issue of payments to the members of an LLC is fairly complex. The decision of whether to issue a guaranteed payment (it's an IRS) which is defined as payments to a partner in his or her partner capacity for services or the use of capital if determined without regard to the income of the partnership or whether to classify them as distribution depends on the positions of the members, the revenue of the LLC and amount that is being distributed etc.
as far as control, you would designate yourself as the managing member and give the managing member all management decisions
those duties are defined in the operating agreement
because this is not the ordinary LLC multi partner situation this would require the involvement of an accountant and an attorney to structure the payments properly and to draft the operating agreement in a way that would give you operational freedom
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