Myths about Limited Liability Companies
Limited Liability Companies (LLCs) are a form of business enterprise that contain elements of both business partnership and corporate structures, a unique blend which allows LLCs to be both more flexible and potentially more stable than either of these types of business arrangement. For this reason, many business owners may have an interest in forming their company as an LLC. However, doing so requires knowledge of the legal requirements and processes involved.
If you or someone you know is interested in forming an LLC, an experienced professional can help to ensure that the process runs as smoothly as possible. Contact the Texas business formation experts of Texas Legal Entities today at 512-472-2431 to discuss your situation.
LLC Myths
The following are some of the most common current myths and misconceptions about LLCs and LLC formation:
Myth: Corporations provide more liability protection to business owners than LLCs.
Fact: Not only do LLCs provide comparable liability protection to business owners as corporations do, but because of the reduced level of legal maintenance involved in an LLC, they may in fact safer than corporations.
Myth: LLCs are taxed the same as corporations.
Fact: One of the most important benefits of organizing a business as an LLC is that it can be taxed in a number of different ways. If the LLC is a sole proprietorship, it would be a “disregarded entity” and the owner would simply report its income on their tax return. If it is a partnership, it will be taxed as a business partnership. Additionally, the members of an LLC can choose to be taxed as a corporation, as well.
Myth: LLCs are only for small businesses.
Fact: Because of their considerable flexibility, LLCs are an attractive structure for small businesses. However, by no means does this exclude larger businesses from enjoying its benefits. Some larger companies that are organized as LLCs include Amazon.com and Chrysler.
Contact Us
If you are interested in forming a company as an LLC, you should discuss your situation with a party familiar with these matters. Contact the Texas business formation experts of Texas Legal Entities at 512-472-2431 to speak with one of our knowledgeable consultants.
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