GLOSSARY · TAX & ESTATE
Charging order
A court order that lets a creditor of an LLC member or partner receive any distributions the entity pays that owner, without gaining any vote or control. Where it is the creditor's only remedy, it discourages collection against business interests. Its strength depends on state law, and single-member LLCs often get weaker protection.
Also called: charging order protection, charging lien
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CHAPTER · WEALTH PROTECTION FUNDAMENTALS · FOUNDATIONSLLCs, Family Partnerships and Protection TrustsRELATED TERMS
SOURCES
- Uniform Limited Liability Company Act (2006, amended 2013), section 503. Uniform Law Commission.