New York § 508 - 508Limitations on distributions
Full text of New York New York Consolidated Laws § 508 — 508Limitations on distributions, with citation guidance and answers to common questions.
§ 508. 508Limitations on distributions
§ 508. Limitations on distributions. (a) A limited liability company shall not make a distribution to a member to the extent that, at the time of the distribution, after giving effect to the distribution, all liabilities of the limited liability company, other than liabilities to members on account of their membership interests and liabilities for which recourse of creditors is limited to specified property of the limited liability company, exceed the fair market value of the assets of the limited liability company, except that the fair market value of property that is subject to a liability for which the recourse of creditors is limited shall be included in the assets of the limited liability company only to the extent that the fair value of such property exceeds such liability. (b) A member who receives a distribution in violation of subdivision (a) of this section, and who knew at the time of distribution that the distribution violated subdivision (a) of this section, shall be liable to the limited liability company for the amount of the distribution. A member who receives a distribution in violation of subdivision (a) of this section, and who did not know at the time of the distribution that the distribution violated subdivision (a) of this section, shall not be liable for the amount of the distribution. Subject to subdivision (c) of this section, this subdivision shall not affect any obligation or liability of a member under the operating agreement or other applicable law for the amount of a distribution. (c) Unless otherwise agreed, a member who receives a wrongful distribution from a limited liability company shall have no liability under this article or other applicable law for the amount of the distribution after the expiration of three years from the date of the distribution.
Frequently Asked Questions About New York § 508
What does New York Consolidated Laws § 508 cover?
Section 508 ("508Limitations on distributions") is part of the New York Consolidated Laws, the codified statutory law of New York. It sets out the legal rule or procedure described in the text above. Statutes are amended regularly, so always verify against the official source.
How do I cite New York § 508?
A common citation format is "New York Consolidated Laws § 508" (New York). Legal writing may require the code abbreviation, section number, and year or edition. Match the style required by your court, professor, or publisher.
Is this the official text of New York law?
No. This page is for research and education and may not include the most recent amendments. For official current law, check the New York official source linked on this page or consult a licensed New York attorney.
How does New York § 508 apply to my situation?
Statutes are interpreted in context, and application depends on your specific facts. Only a licensed attorney in New York can advise on how this section applies to you. Contact your state or local bar association for a referral.
Sources & Verification
Not legal advice. Verify against the official source and consult a licensed attorney in New York.