The Limited Liability Company - Benefits And Advantages
The Limited Liability Company - Benefits And Advantages
By Business Editor
The limited liability company, or LLC, offers some attractive alternatives to incorporation ...
Any company, regardless of size, should look into forming some type of the limited liability company, or LLC, rather than the more common incorporation, etc. This business structure has only recently been adopted by all 50 states and offers some attractive alternatives to incorporation.
This business structure combines the best aspects of incorporation with the tax advantages of partnership, without the red tape of either. Experts have said that anyone starting a new business must separate their personal life and assets from their business ventures, in order to avoid any personal liability. A limited liability company is personal protection in its purest form. As a business owner, you need to avail yourself of any and all laws that are designed to provide any type of protection. Whatever form of business structure is selected, whether corporation, partnership, LLC, etc., it needs to be well thought out and put in place at the beginning.
The limited liability company does have the benefit of simplicity in its operation and understanding. It was designed with the small business owner in mind and once in place it does not require ongoing, high maintenance. When you form a limited liability company you have the added benefit of it being easily modified, to reflect any changed objectives or circumstances.
Most states do require an LLC business to have an Operating Agreement of some sort between the owners/members, with regard to how it will be operated. It covers many different areas of operation, including management, distribution of profits and losses, termination, admission of new members and any special allocations. It also contains certain things that qualify it for the quite beneficial partnership tax agreement. If the document is not drawn up correctly, then of course the LLC will not qualify and will be taxed as a corporation. The individual state statutes are classified as "flexible" or "bulletproof." A bulletproof statute requires that the operating agreement have certain provisions that will allow them to qualify for partnership taxation. Flexible statutes allow the drafting of the Operating Agreement up to the individual organizers. Although not all states have adopted it, there is a process called "Check the Box," wherein the LLC organizer can just elect what tax treatment is preferred. If you are unsure as to whether or not this is an allowable option for you, then the safest way to organize is to comply with the original guidelines of the corporate characteristics.
The simplicity involved when forming a LLC is one of the advantages that attracts business owners, and another is the "freedom of contract" principle, which allows the owners/members of the limited liability company to form and run the company in any way they see fit. The actual paperwork is fairly simple as well. Most states only request filing two forms, one is the Articles of Organization and the other is an annual report that updates basic information to the state. There are filing fees required for these forms, but the amount varies from state to state.
The Complete Business Plan Secrets Revealed Business Plan Manual
Learn how to find investors for your business with insider truths about raising money through business plans. This 135 page Business Plan manual teaches you step-by-step how to create and market a Business Plan that attracts investors and key players.
LLC Explained
You may have seen it in many different places; it has become so common you may not even notice it anymore. Normally denoted by L.L.C. or LLC, the acronym refers to "limited liability company." Business... LLC - Answers To Common Questions
LLC may not be a term that you are familiar with but it is a term that you need to be in great understanding of if you are a business owner. It is important to the liability and safety of your company.... About Small Business Startup Grants
Small business startup grants are an ideal way for a person with the dream of starting a small business to achieve that dream. Although many people choose to fund their new business with bank loans or...
Recommended Business Resources
For more information about Business Startup-related resources, see our Business resources section, subscribe to our Business Newsletter containing news, updates and insider tips, or go to more articles about Business Entity.
***
Related Topics ...
***
Search for more information on "business entity" below:
You are here: Home » business-startup » The Limited Liability Company - Benefits And Advantages
Get Regular Business Information And Insider Tips
Receive free practical Business tips delivered to your email box with contributions from business writers, experienced business coaches and trainers, marketing experts and successful business owners. Also receive free business resources as our gift to you.
Email Instructions:
Fill-in your First Name and primary Email below to claim your FREE gifts and stay up-to-date with the latest exciting news and information on Business!
Your privacy always comes first and your email address is never shared with anyone ever.
Business Startup Facts & Tips
Unfortunately, gender discrimination is still alive in the 21st century. Women still have to work harder to prove their worth in the primarily male-dominated world of finance. It is critical for female business owners to provide an excellent sales pitch, coupled with an impeccable business plan, in order to secure funding. Women must also be careful not to undersell themselves. Studies have shown that women tend to ask for less money than their male counterparts do.
Business Startup Resources:
The Complete Business Plan Secrets Revealed Business Plan Manual
Business Startup Product Review
Business Plan Secrets Revealed ... How To Write And Market A Business Plan
This 135 page Business Plan manual teaches you step-by-step how to create and market a Business... The E-Myth Revisited: Why Most Small Businesses Don't Work and What to Do About It
Recommended Business Resource - The E-Myth (Revisited)
The E-Myth (Revisited) - Why Most Small Businesses Don't Work And What To Do About It by Michael E. Gerber
The "E-Myth" is without a... Easy Photography Home Business
Home Based Business Opportunity - Product Review
How To Start A Lucrative Home-Based Photography Business
If you're searching for a fun and profitable way to make money with your digital camera,...