Hey guys, today we're gonna talk about everything you need to know about LLC's.
From what is it - what are the advantages and how you can use it to
your advantage.
So let's get to it, LLC stands for limited liability company.
An LLC is just one of several business structures. Other common examples include
Corporations, Sole proprietorships, and Partnerships but today we're just going
to talk about an LLC. Forming an LLC is the simplest way of structuring your
business to protect your personal assets in case your business's sued. So this is
the most important benefit of having an LLC is that it protects your personal
assets so let me clarify what this means. This means that if you have any personal
assets such as having your own personal chicken account or your a home or any
kind of assets that you have either you know items or real estate or anything
like that by creating an LLC it separates your
business from you personally so that if your business gets sued then only your
LLC is responsible for that lawsuit and you yourself won't be personally liable.
Unlike Sole proprietorships and Partnerships LLC's can protect your
personal assets if your business is sued as we already
talked about. Also, for most small businesses an LLC offers the right mix
of personal asset protection and simplicity just in basically just it's a
simple structure it's the most simple a business structure. Unlike corporations
LLC's are relatively easy to form and maintain and are not subject to double
taxation we won't get into too much about double taxation but all you need
to know is that LLC's that you'll be taxed personally on your own personal
tax return you they're not subject to double taxation which is how C
corporations are usually taxed. So let's look at a breakdown of the LLC benefits
first is business duration can be perpetual so let us say by creating an LLC
if something happens to you then the business continues to live just by
something happening to you let's just say God forbid if you happen to pass
away then the business can still continues. LLC can also be owned by
another business there's no requirements for annual meetings for
an LLC there's less formalities LLC is formed on the state level and LLC owners
can report profits and losses on personal tax returns that's not the case
for corporations. Also, owners have limited library protection which we
talked about which corporations share the same benefit and LLC's can also be
kind of like to be taxed as an S corporation which basically will save
you in taxes I won't go to to into too much detail but I'm sure I'll have an
have a video that explains this as well.
LLC's can be owned by one or more people
who are known as LLC members so if you're if you ever hear about members
these are essentially just the people who own an LLC. Generally an LLC is
managed by its members known as member managed LLC. However in some cases
members will appoint a manager to handle the LLC's daily operations and this is
called manager managed LLC. So usually an LLC there's two types either member
manage which basically means that the else is run by the members themselves or
if you want exactly somebody else to run the day-to-day operations then it could
be designated as a manager managed LLC an LLC with one owner is known as a
single member LLC and then LLC with more than one owner is known as a
multi-member LLC so you may hear about single member LLC's essentially all it
means is it's a single owner who owns LLC that's all it means
so what's the point of forming an LLC forming your business as an LLC helps to
protect you against lawsuits again we talked about personnel we talked about
personal liability protection that analysis LLC also significantly cuts
down on paperwork compared to corporations and other
illegal entity types as you talked about LLC is very simple to form and it's very
easy on easy to deal with the ongoing requirements of LLC LLC prevents your
company from being taxed twice essentially corporations have this
determined as I manage this is C corporations not S corporations so by
having LLC you'll be you won't have to deal with double taxation and I'll see
also helps to present your business as more credible usually other vendor
vendors and other businesses want to deal with LLC's don't they don't want to
deal with some fighter ships so by having LC you be able to do you'll be
able to put yourself out there as a registered and business entity in
conclusion LLC is the simplest way to create a business entity in order to
protect your personal assets from possible lawsuits so yes there are other
businesses business types such as an S corporation but if you're trying to take
the easy simple way out then LLC is the best business type if you'd like to
learn more about LLC's and which business type is right for you click the
link below in the description below and if you have any other questions go ahead
and comment look forward to answering all your questions thanks