Prime Corporate Services, LLC, provides comprehensive consulting related to the planning and setup of business entities. Prime Corporate Services can help a business understand the various advantages and limitations of forming a limited liability company, or LLC, as opposed to a corporation, and to decide whether or not to choose that particular structure.
An LLC simultaneously incorporates aspects of a corporation, a partnership, and a sole proprietorship. Most LLCs closely resemble a partnership or sole proprietorship in matters of taxation, in that the owners report profits and losses on their own individual tax returns and pay the taxes instead of the entity. However, owners of an LLC may choose to have the entity taxed as a corporation, in which case the business must follow all relevant corporate tax regulations.
Owners of an LLC also do not shoulder responsibility for any debts or lawsuits that the entity incurs. If anyone files a lawsuit against the LLC, the courts may not force the owners to use their personal assets to pay a settlement. Relatedly, when an LLC goes through bankruptcy, creditors may not seek repayment from the individual owners.
However, an LLC does have its limitations, including the inability to issue shares of stock.
Although it is possible for aspiring business owners to decide independently which type of entity is the most appropriate for their enterprise, many seek out professional guidance.
