TL;DR - LLCs limit members’ liability by separating a company’s business assets from the personal assets of the members.
Helpfulness - 3
Tags - LLC, partnership, taxes, debts, liabilities, corporation
- What is a Limited Liability Company?
- How does an LLC compare to a partnership?
- What are advantages and disadvantages of LLCs?
- Members are not personally liable for their company’s debts or liabilities (like a corporation).
- LLCs have characteristics of a corporation and those of a partnership/sole proprietorship.
- LLC regulations vary from state to state.
- LLCs can choose to list profits and losses on the personal tax returns of owner(s), and thus not pay federal taxes (like a partnership).
- Compared to a corporation, LLCs are easier to set up and provide more flexibility and protection.
- LLC members’ wages are listed as operating expenses.
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