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Limited Liability Corporation (LLC)

Thinking of forming a LLC?
A Limited Liability Corporation (LLC) is often referred to as a combination of a corporation and a partnership. It offers the liability protection of a corporation while providing tax advantages and management flexibility of a partnership.

LLC offer many benefits beyond providing tax advantages.

  1. Limited Liability

    Owner/Members has/have limited liability for business debts, so that personal assets find protection from lawsuits. 

  1. Pass-Through Taxation

    This avoids double-taxation. Since LLCs are not considered taxable entities, the IRS automatically taxes a Single-Member LLC as a sole proprietor, and a Multi-Member LLC as a partnership. Thus, business income and losses are reported and taxed only on the owner(s) individual tax return(s), and not additionally on the company’s corporate return. 

  1. Citizenship

    Neither citizenship, nor permanent residency is required to form a LLC. 

  1. Management Flexibility

    Management by owner(s) or hired, qualified staff is possible. Also, there are no restrictions as to how many owners a LLC may have. 

  1. Simple Recordkeeping

    No annual meetings, or draft meeting minutes are required. However, an operating agreement has to be written up and filed with the Secretary of State.  

  1. Deductable Expenses

    Normal business expenses can be deducted from the profits before income allocation for tax purposes takes place. 

  1. Flexible Profit/Loss Allocation

    Also referred to as “Special Allocation”. Profits and losses can be allocated as owner(s) may see fit – regardless of ownership/member interest. 

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