Limited Liability Companies (LLC's)
Limited liability companies (LLCs) are important legal structures for forming a business. Limited liability means that the assets and debts of the business remain separate from the personal assets and debts of the company's owners. LLCs also have several beneficial features including simplified taxation and a relatively straightforward
Limited liability companies (LLCs) are important legal structures for forming a business. Limited liability means that the assets and debts of the business remain separate from the personal assets and debts of the company's owners. LLCs also have several beneficial features including simplified taxation and a relatively straightforward process to establish one. This is part of the reason why LLCs are the most common type of business in the U.S.
A limited liability company, or “LLC”, is a type of business structure commonly used in the United States. LLCs can be seen as a hybrid structure that combines features of both a corporation and a partnership. Like a corporation, LLCs provide their owners with limited liability in the event the business fails. Like a partnership the LLC'
A limited liability company, or “LLC”, is a type of business structure commonly used in the United States. LLCs can be seen as a hybrid structure that combines features of both a corporation and a partnership. Like a corporation, LLCs provide their owners with limited liability in the event the business fails. Like a partnership the LLC' will “pass-through” their profits so that they are taxed as part of the owners’ personal income.
The LLC has two main advantages:
First, it prevents its owners from being held personally responsible for the debts of the company. If the company goes bankrupt or is sued, the personal assets of its owner-investors cannot be pursued.
Second, it allows the profits to be passed directly to those owners to be taxed as personal income.
This e
The LLC has two main advantages:
First, it prevents its owners from being held personally responsible for the debts of the company. If the company goes bankrupt or is sued, the personal assets of its owner-investors cannot be pursued.
Second, it allows the profits to be passed directly to those owners to be taxed as personal income.
This essentially avoids "double taxation" of both the company and its individual owners.