Home
Small Business Blog
Asset Protection
Business Law
Business Startups
Corporation by State
Debt Solutions
Drugs Online
Financing
Health Links
Home Business
Home Business Tax
LLCs
LLC States
Marketing
Mortgage Types
Online Jobs
S-Corp by State
Tax Updates
Whey Protein
Women in Business
Site-Map

[?] Subscribe To This Site

XML RSS
Add to Google
Add to My Yahoo!
Add to My MSN
Add to Newsgator
Subscribe with Bloglines

LLC Advantages Disadvantages



LLC Advantages and Disadvantages



LLC Advantages Disadvantages - The LLC is a relatively new type of hybrid business structure that is now permissible in most states. It is designed to provide the limited liability features of a corporation and the tax efficiencies and operational flexibility of a partnership. Formation is more complex and formal than that of a general partnership.

The owners are members, and the duration of the LLC is usually determined when the organization papers are filed. The time limit can be continued if desired by a vote of the members at the time of expiration. LLC's must not have more than two of the four characteristics that define corporations: Limited liability to the extent of assets; continuity of life; centralization of management; and free transferability of ownership interests.

LLC Advantages Disadvantages

LLC Advantages

  • Owners have limited personal liability for business debts even if they participate in management
  • Profit and loss can be allocated differently than ownership interests
  • IRS rules now allow Limited Liability Corporation (LLC) to choose between being taxed as partnership or corporation

LLC Disadvantages

  • More expensive to create than partnership or sole proprietorship
  • State laws for creating Limited Liability Corporation (LLC) may not reflect latest federal tax changes

Professional Limited Liability Company

 LLC Advantages
  • Same advantages as a regular limited liability company
  • Gives state-licensed professionals a way to enjoy those advantages
LLC Disadvantages
  • Same as for a regular limited liability company
  • Members must all belong to the same profession


Limited Liability Partnership

 LLC Advantages
  • Mostly of interest to partners in old-line professions such as law, medicine, and accounting
  • Owners (partners) aren't personally liable for the malpractice of other partners
  • Owners report their share of profit or loss on their personal tax returns
LLC Disadvantages
  • Unlike a limited liability company or a professional limited liability company, owners (partners) remain personally liable for many types of obligations owed to business creditors, lenders, and landlords
  • Not available in all states
  • Often limited to a short list of professions.


LLC Advantages Disadvantages
| Business Partnerships | S Corp vs C Corp | Sub S Corporations | LLCs Listed by State
| Business Deductions | LLC vs S Corp | CORP vs Part/Sole Part | LLCs Taxes
| Business Formation | ICs and IRS | Piercing the Corporate Veil | How to Incorporate
| Delaware Corporation | Corporations Listed by States | S Corporations Listed by States

Home | Site-Map