LLC is an abbreviation for a limited liability company. This is a kind of business structure that is mainly used in the united states of America. Private corporations commonly use this type of business structure.
A limited liability company has the combination of the elements of a partnership, sole proprietorship, and that of a corporation. This fascinating combination ensures the safety of the company owners’ assets when the company falls in huge debts.
A limited liability company doesn’t pay taxes like other business corporations. A person starting a business for the very time would instead benefit hugely from this. In an LLC, the taxes are paid by the company members who are also the owners of the company.
Limited liability company offers the owner and the members of the company also the benefits of a corporation. The owners and members of the company are protected from the threatening legal problems which the company faces. They cannot be held personally liable for the damages that occurred.
Keep track of the income.
The income made by the company can be tracked with ease. Any checks written for an LLC are done in the name of the company. And when there are expenses, the money is taken from the company’s account and not from an owner or a member’s account. The owner of a company can write himself any number of checks from the company’s account. It can also achieve by LLC filing services.
An LLC is primarily governed with regards to the laws of the state in which the company is registered in. The laws of each state in the united states of America differ drastically. In some states, when a member of an LLC corporation dies or decides to leave the company, according to some state laws, the company may get dissolved, but in some states, the share of that member may be passed on to other members of the company.
Even though the LLC provides a safety net from corporate taxation, it doesn’t provide benefits for personal taxes. Since a member is seen as self-employed, he is required to pay self-employment taxes on medical care and social security accounts.