You’ve reached the point where you’re able to start your own business. Now you must decide what type of business entity you should create. One option you have is to form a limited liability company, or LLC.
A limited liability company can be a great choice for small businesses. However, each business entity has its own benefits to take into consideration. Here are some benefits a LLC can offer:
While the above can be good benefits of LLCs, they do have some drawbacks. Members pay self-employment taxes based on the net income of the business. This can mean paying more taxes than as the owner or shareholder of a corporation.
Also, LLCs also only stay alive if the members stay with them. Having a member leave can mean the dissolution of the business.
An LLC is one form of business entity. It may not be right for every business. Always consult a lawyer and accountant when deciding on the best entity for your business.
Choosing a LLC for your business entity can provide you certain benefits. LLCs are generally easy to set up and manage. They offer different tax options that can save you money. And they protect your personal assets from creditors or lawsuits.