If you have decided to start your own LLC but need assistance, you have come to the right place. From understanding the legal requirements to filing the necessary paperwork, our team is here to provide you with the support you need.
Why Should You Start an LLC?
- Smaller Operations
- Limited Liability Protection
- Flexible Ownership and Management
- Taxation Options
Smaller Operations
LLC business structure is quite popular among small businesses. If you plan to operate as a closely held company or a family business without immediate plans to seek venture capital, forming an LLC would be an optimal choice.
Limited Liability Protection
LLC business structure provides the liability protection of a corporation with the advantage of being treated as a partnership. In such a business structure, each partner is granted the liability protection typical of a corporation, meaning an individual is never solely financially liable for the other members of the firm or the firm’s debt. However, owners of the business can claim the debt against their incomes when filing taxes. This type of tax break is similar to those offered in a partnership.
Flexible Ownership and Management
An LLC’s members have the legal authority to manage the company’s operations. However, it is within the LLC’s power to specify that managers will be in charge instead through its operating agreement. This means the members can opt for a “member-managed” format, in which each member has equal rights in the management and conduct of the company business. Alternatively, if the LLC is “manager-managed,” the managers have the exclusive authority to manage and conduct the company business.
Taxation Options
The LLC business structure provides pass-through income taxation to its members, which is one of its principal advantages. According to IRS regulations, an LLC with more than one member will be treated as a partnership unless it elects to be taxed as a corporation; otherwise, it will be disregarded for tax purposes. If it is considered a partnership, the LLC’s profits will be distributed to its owners and taxed at their personal tax rates, comparable to a limited partnership’s tax treatment. However, It can elect to have corporate tax treatment, in which case it will be taxed as a corporation.
Contact us today to learn more about how we can assist you in setting up your LLC!
