What are the advantages of organizing a business as a limited liability company?
There are several advantages inherent to the limited liability company structure. The primary advantage is the combination of tax and liability treatment enjoyed by these companies. Limited liability companies are taxed like partnerships, meaning that income is only taxed once. But the limited liability company members are shielded from company liability in much the same way that corporate directors and shareholders are shielded. Thus, the company enjoys one of the most important benefits of corporate structure without one its most significant liabilities. Note, however, that like corporations, members and officers are not shielded from personal liability for their own negligence, recklessness or criminal activity. Another advantage of the limited liability company structure is that the company can distribute its profits to its members in any manner it wishes, without strict correspondence to the percentage of the company owned by each member.
