The Charging Order and Limited Liability Companies.
Creditors have to satisfy themselves with a 'Charging Order' .
This gives them the rights to any distributions made by the LLC to that particular member, but little else. In such instances, creditors may find themselves with more problems than profits. Since an assignment of the rights of income under a charging order may also mean an assignment of the liability for taxes, the creditor may be given a K-1 form reflecting the taxable income allocated to the charging order . In the real world this may cause the creditor to want to either drop the lawsuit or settle for pennies on the dollar. No matter what the situation, you are always at the mercy of the judge.