In what situations, in summary, is the Limited Liability Company best suited?
An LLC is best used when two or more people are considering a business or investment venture. The LLC provides significant advantages over both general partnership and limited partnership structures. Similar to an S corporation, it does not have its restrictions. LLCs are available to professionals and may be advisable in place of a Limited Liability Partnership because more states recognize LLCs than LLPs for the protections discussed here.. They should not be used when a regular “C” corporation would be able to utilize the corporate reorganization tax provisions or the ability to have separate classes of stock. It is particularly appropriate for real estate ventures containing corporations, trusts or foreign investors or new business ventures involving existing corporations. The LLC is a fine tool as an estate planning entity for investments between an individual and his or her family corporation, trust or partnership.
