What Is a Limited Liability Company (LLC)?

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One of the most important aspects of business ownership is trying to determine what type of entity you should file. In fact, it's one of the most asked questions that MyLLC.com receives. It is imperative that you first seek counsel from your tax adviser and lawyers prior to making any major decisions regarding your business. With the understanding that MyLLC.com does not give legal or tax advice, this is a broad-stroke definition of LLCs, which is the type of business entity that most people are familiar with.

According to IRS.com, "A Limited Liability Company (LLC) is a hybrid type of legal structure that provides the limited liability features of a corporation and the tax efficiency and operational flexibility of a partnership." The owners of an LLC are referred to as "members." Depending on the state, the members can consist of a single individual (one owner), two or more individuals, corporations or other LLCs.

Essentially, LLCs offer the best of both worlds — the pass-through taxation and hassle-free maintenance of a partnership, and the limited liability protections for the owners and operators that a corporation offers. This is why it is quickly becoming the most popular business structure available today.

If you have determined that an LLC is the right entity for your business, MyLLC.com is ready to assist you with the entire process. Let's get started!

What Are the Advantages of an LLC?

• Personal liability protection. Any creditors who come knocking or lawsuits filed against your business can't affect you personally. You can rest assured that no matter what happens in the business, your family's assets are safe.
• Business liability protection. An LLC is one of the only entities that prevents personal lawsuits and creditors from liquidating your business.
• No separate tax returns. With a standard LLC, the business's profits and losses are reported on your personal tax returns.
• No double taxation. With a standard LLC, the business's profits and losses are reported on your personal tax returns.
• No ownership restrictions. You can have as many owners as you need. Even other entities can be owners!
• No management restrictions. Owners can manage and managers can own - you decide.
• Flexible tax status. You can choose from a multitude of ways to be taxed, depending on what works best for your situation.
• Flexible profit distribution. You decide what percentage of the profits to give to whom - no matter how much of the company the person actually owns.