Frequently Asked Questions
What is a LLC?
LLC is the short term for a “Limited Liability Company”. Limited Liability means that the owners financial liability is limited to their investment in the company. For example, if someone sues a business with limited liability, they can generally only sue the company, not its owners or investors. Investors or owners won’t have to pay out-of-pocket to cover lawsuits or other debts. However, investors may lose the value of their investment in the company.
An LLC does not issue shares, but it can have multiple owners who all share a percentage of the company. The ownership, management and profit distribution structure of a LLC is listed in the Operating Agreement of the company.
A single person owned LLC is a generally registered as a pass-through business entity for federal income tax purposes. LLCs can also be taxed as an S Corporation or C Corporation. No other entity has this flexibility.