Updated: Dec 27, 2022
One of the most important steps to take when starting a business is deciding what kind of business structure suits you the best. A limited liability company (LLC) is one of the most popular business structures for small businesses because they offer a number of potential advantages over other business structures like sole proprietorships and corporations.
What is an LLC? A limited liability company (LLC) is a business structure in the U.S. that protects its owners from personal responsibility for their debts or liabilities. Every state has its own regulations and regulations to follow. There are also types of businesses that cannot be LLCs like banks, insurance companies, and real estate agents. There are a few more so check with your state to see if your business idea can become an LLC.
Things To Know!
Unlike sole proprietorships, your business are separate entities. If your company has a debt or liability, a court cannot sue you as an individual.
Having the letters LLC at the end of your business name adds credibility to your business.
For example. “Julia Writing Services LLC” sounds more credible than DBA “Julia Ramirez Services”
Being an LLC comes with some identity protection since you do not have to release your name when conducting business.
Reference: NOLO Working for yourself guide, IRS - LLC Section
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