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LegalCornerTM - Sole Proprietorship F.A.Q.'s

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Q.How do I convert my sole proprietorship to an LLC?

A.Under California law, a sole proprietorship cannot be converted into an LLC, but a sole proprietor can form an LLC. No conversion takes place because the sole proprietorship is not a distinct entity. A conversion process occurs when a business was formerly operated as a partnership or limited partnership and now wants to convert to an LLC.

Formation of an LLC occurs upon the filing of Articles of Organization (Form LLC-1), which should be followed by the creation of a detailed Operating Agreement and the filing of the Statement of Information. As California now allows single-member LLCs, there is no need to add another individual to the filing, or your spouse as a member. However, if you are married it may be in your best interest to do so.

Copyright 1999-2019 Melissa C. Marsh. All Rights Reserved. All Information on this website is subject to a Disclaimer and Use Agreement. This information is provided as general information only and should not be construed as legal advice. We advise you to seek the advice of competent legal counsel to address your own specific questions, facts and circumstances.