a partnership with the legal protection of a corporation. As an LLC, the business is a separate entity from the owners. The individuals may lose what they put into the LLC but the personal assets of the owners will be protected from lawsuits.
2. Avoid Double Taxation
Companies organized as a corporation are subject to double taxation: paying taxes at both the corporate and individual level. When you operate as an LLC, you can skip the agony of having to fill out a business tax return because it’s not needed. The LLC doesn’t pay federal income taxes and does not have to file a tax return with the IRS. So, you’ll be able to save on tax return preparation fees, too!
3. Pass-Through Entity
If you are the only member in your LLC, the IRS will treat your business as a single-member LLC and you will be taxed as a sole proprietor. All of your business income or losses of the LLC will be reported on Schedule C and submitted with your 1040 tax return. This “pass-through” entity feature allows profits and losses to skip the business and transfer over to the individuals.
4. No Formal Structure Required
C Corporations and S Corporations are required to form a board of directors, plan an annual meeting, and maintain meeting minutes to be legit. You don’t need a team of people and advisors to start an LLC. When you’re ready to get the