Starting your own business can be an exciting time. The prospect of being your own boss and putting your years of experience to work can instill an exhilarating feeling. It can also, however, provoke certain thoughts of uncertainty. After all, entrepreneurship is not without a degree of risk. As a business owner, the onus is on you to do whatever you can to mitigate any potential pitfalls. One way in which many opt to accomplish this to start an LLC company. In fact, Limited Liability Companies (LLCs) are incredibly common legal structures among business owners, and as you will learn, for good reason.
There are, of course, many different modes available for structuring a business or organization. There are S- and C-corporations, Sole Proprietorships, General Partnerships, Limited Liability Partnerships, and more. In your time in the working world, you have probably observed that LLCs are a popular choice. Once you can gain an understanding of the perks of an LLC, you might find that it is the right maneuver for your business.
What Is a Limited Liability Company?
A Limited Liability Company is a legal formation that allows its members to enjoy the privilege of “limited liability.” Under this concept, if your business is facing bankruptcy or ruinous lawsuits, the members of the LLC cannot be found liable. This means that you and the other members of the LLC can protect your personal assets against any potential legal judgments. Since this takes a great deal of risk off the table, it is an especially enticing factor for business owners.
In an LLC, your business is treated as a pass-through organization by the Internal Revenue Service (IRS). This status means that profits made by your business are not taxed off top, rather they pass through to the individual members of the LLC, who will then pay taxes on their personal income. As you can likely deduce, that is a considerable financial benefit for any business, and it is a key draw for entrepreneurs.
How to Start an LLC Company
LLCs are available to business owners in all 50 states, which is not true of LLPs. While individual state requirements will vary, you will generally need to submit what are called “Articles of Organization” to your state’s Secretary of State office. This document should contain some basic information about your business, its address, and the contact information for the members of the LLC. You will also need to appoint a registered agent. The role of this individual is to handle all legal, government, and tax correspondence on behalf of your business.
We Can Help You Form Your LLC Online
If you browse the side navigation of our website, you will see that we offer business formation forms for all 50 states. If you are interested in forming an LLC, using one of our streamlined web templates can save you considerable amounts of time and energy. If you would like to learn more, please contact one of our helpful customer service agents by phone or email today.