A Limited Liability Company, or LLC for short, is a type of business organization that is used widely throughout the United States. For many people, LLCs can provide substantial financial and legal benefits, without all of the complexity associated with corporations. But how can an LLC potentially benefit your company, and is it right for your business?
What is an LLC?
In simple terms, an LLC is a type of unincorporated business organization that, as the name suggests, helps to protect its owner or owners from legal and financial liability related to its business activities. Because it is unincorporated, it is not considered a separate legal entity from its owners. However, it must still operate according to certain rules defined by the laws of the state where it is organized.
How Does an LLC Work?
When you create an LLC, either because you just started a business or because you are reorganizing an existing company, you may operate similarly to a partnership, with profit divided among all members. Similar to a corporation, you must file certain documents to legally operate as an LLC, known as articles of organization. This document outlines the basic rules about how your company will operate, including its ownership (known as “members”) and any initial bylaws related to its day-to-day functioning.
What Are the Benefits of an LLC?
There are two primary benefits to an LLC that most people consider when deciding to organize their business. First, if the company ever faces legal or financial liability, any costs from that liability are taken from the company’s income and holdings, rather than from the personal assets of the members. Second, the legal requirements for operating an LLC are much more loose compared to corporations, meaning you need to worry less about failing to uphold specific rules or regulations.
What Should You Do?
The question of whether an LLC is potentially right for you depends on your personal circumstances. That is why you should speak to a lawyer with experience handling business law matters, including business organizations. They can consult with you to determine what is best for you and your business, and guide you through the process of starting or reorganizing your company.
If you have an employment issue, give the Law Office of Andrew Ross Sack a call. Andrew Ross Sack is a New York and New Jersey employment lawyer who has considerable experience in handling the many aspects of labor and employment law. To schedule a consultation with New York City/Long Island/Westchester employment lawyer Andrew Ross Sack, call (516) 526-3319 or visit his contact page.
