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Types of Legal Structures - Limited Liability Company

03 Jun 2020 2:12 PM | Cordina Charvis (Administrator)

Limited Liability Company

A limited liability company (LLC) is a business whose members are protected from personal liability for the acts and debts of the company in the same way as a corporation but can opt to be taxed as a partnership.

For limited liability companies:

  • Members do need to file organization papers with the state.
  • An operating agreement governs the rights and responsibilities of the members and how the business will be run.
  • The LLC can choose to be taxed as either a partnership or a corporation.
  • The SBA notes that LLCs provide the benefits of limited liability and less recordkeeping than corporations, but members may have to deal with dissolution if a member leave or dies, although the operating agreement can be drafted to address this situation.

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