The Business Formation Question: Corporation or LLC
Is a Limited Liability Company (LLC) better form for your business than a corporation?
The advantage of a Limited Liability Company is it allows management flexibility, and has potential tax benefits for the members. In addition like the name states a LLC limits the business owner’s personal liability.
In short, an LLC allows your business to have the limited personal liability of a corporation as provided by Florida state law and be treated as a partnership for purposes of Federal tax laws. The tradeoff is there is no free transferability of ownership and the business cannot be owned by a single individual like a corporation.
Growth and the Limited Liability Company (LLC)
A limited liability company usually has a shelf life of so many years or a specified event. A Corporation is more a fit for if your business plans include raising capital, adding partners or the going for the IPO. An LLC restricts the transfer of ownership interest to focus on the Partnership for Federal tax laws.
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Business owners like the LLC structure because it gives a great deal of flexibility in allocating profit and loss. In addition, a Limited Liability Company also allows the owners flexibility in the business management team and what each owner’s management duties are in the company.
Business formation whether a Corporation or a Limited Liability Company is an important decision that can affect the business now and in the future. If you have questions call the experienced business law attorneys at Campbell Law Office in Miami Florida. Our lawyers will discuss all of your options and work with you and your accountant to make the right decision for your business.