Can I just transfer my LLC to my family member or do they have to buy me out and I close my company?

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Can I just transfer my LLC to my family member or do they have to buy me out and I close my company?

I have an LLC but my brother-in-law does all the work and is screwing me on the money. I want out. What do I need to do – close my company and make him get loans to buy the equipment from me or is there a way to transfer ownership of it to him and get my name off of everything?

Asked on February 15, 2019 under Business Law, Georgia

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 2 years ago | Contributor

You can, if he agrees, simply either sell or give/gift the company (your ownership interest in the LLC) to him--but he has to agree; you can't make someone take ownership of something against his will. You can do this, if he agrees, by a simple contract of sale and, if you have a written operating agreement, amending it if necessary to show him as owner. You'd then make the appropriate changes on the state's website where the LLC was created and any other states in which it is registered to do business, to show him as owner and contact, not you.
Two things to be aware of:
1) Transfering the business and how you do it (e.g. sale vs. gifting it to him) may have tax consequences for you and/or him; consult with CPA before doing anything.
2) Any leases or loans that you took out in your personal name for the business or which you personally guaranteed will remain your leases or loans--you will stay liable on them. Transferring ownership of the business does not affect the liabilty or responsibility for anything you signed in your personal (not LLC owner/manager) capacity.


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