What is Limited Liability Company?

What is LLC? Well, LLC stands for limited liability company and the difference it has from other companies is that it’s not a corporation or partnership business or even does not hold any shareholders

There are members for this company and these members take up all the decisions regarding this institution. Such a company is known as Limited Liability Company.

A limited liability company incorporates both the aspects of corporation and a partnership business making it more flexible and less formal than usual conventional Corporation but offers a lot more protection as well as has a lot of advantages in them. One of the advantages of this limited liability company is that none of its members are held responsible if the company faces any debt. The personal assets of the members do not merge with those of the company and once the company faces any debts, the personal property of members cannot be seized.

Another benefit of this limited liability company is that it’s taxation that is based on a partnership model that has flown through taxation brings in a lot of benefits as the members are supposed to pay their taxes based on the earnings, instead of paying both corporate and personal taxes.

A limited liability company can include as many members it wants and does not have a limited member restriction on the membership of the company. This company does not need any meetings, recording of minutes or any bylaws that speaks about joining of a member. These types of companies are more in demand since the risk factor involved is comparatively less.

In a usual Corporation, shareholders can transfer their stock of ownership but in a limited liability company members cannot do the same. Transferring of individual stock or share depends on the approval of all the other members involved. Moreover if a member of a limited liability company passes away, or it goes bankrupt then the company usually dissolves unlike the conventional corporations which are not restricted with such circumstances.

Articles of organization is the first step to form an LLC which should be filed in accordance to the specific guidelines of the state and all the other fees pertaining to the same should be paid in full. The secretary of state is where articles of organization is to be filed, or you may either hire an attorney to do all the paperwork and file the documents are and can be done by yourself also. In fact these forms are readily available on the Internet, and there is a lot of software to help you do the necessary forms according to the state regulation and this makes it a lot easier.

Hiring an attorney will be the best idea when you need help to set up an LLC. This way you do not have to take up any pressures on yourself and can save yourself a lot of errors and mistakes in the initial phase.

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