Q: I am rebranding my company and I am deciding between making a new LLC or amending the current one.

A: For your situation, when creating a new LLC and transitioning from an older company, there are a few considerations to keep in mind:

If the older LLC has any existing debts, obligations, or contracts, it’s important to ensure those are properly addressed so they don’t carry over to the new entity. Depending on your state and circumstances, there may be tax filings or obligations related to the dissolution of the old LLC or the formation of the new one. Consulting with a tax professional can help clarify this. If the 20% owner of the previous LLC has rights or claims under your operating agreement or other business arrangements, it might be worth reviewing those to avoid potential disputes. Starting fresh with a new LLC and brand is generally straightforward, but make sure you properly transfer or register any necessary licenses, trademarks, or permits under the new entity. You may also want to ensure your new LLC is registered with the appropriate state and local agencies to collect sales tax (if applicable) and file income taxes.

It might be helpful to consult an attorney or accountant to review your specific situation to avoid potential complications.

A: Forming a new LLC for your rebrand is a great way to start fresh as a 100% owner, free from any liabilities, debts, or obligations tied to the old company. This approach ensures your new brand aligns with your vision and target market without being influenced by the history of the prior LLC.

Before dissolving the old LLC, ensure all tax obligations, including income taxes, sales taxes, and annual reports, are up to date. You’ll also need to work with the 20% minority owner to settle any remaining assets, liabilities, or distributions as outlined in the operating agreement.

Creating a new LLC avoids the need to amend the old company’s name, ownership, or target market, which could confuse clients or stakeholders. Additionally, it simplifies tax filings, as the new LLC will have its own Employer Identification Number (EIN) and clean financial record. Consulting an attorney or CPA is recommended to ensure compliance with tax and legal requirements during the transition.