A Limited Liability Company, or LLC, is a type of business structure that combines the flexibility of a partnership with the limited liability protection of a corporation.
It protects its owners from personal liability for the company&#39;s debts or legal actions.
LLCs serve a broader range of businesses than LLPs, which are mainly for professional partnerships.
Unlike corporations, LLCs require less paperwork and are subject to fewer regulations and formalities, making them easier to manage and operate.
Let&#39;s consider five people starting a pet grooming business called Furry Friends LLC. All five entrepreneurs are considered members who hold ownership interests in an LLC.
The LLC does not pay taxes. Instead, the members pay individual taxes for their share of profits and are only taxed once for federal income tax purposes.
If the business fails, the personal assets of members, such as their houses or cars, will not be at risk.
LLCs are a popular choice among small business owners because of their safety and flexibility.
However, LLCs find it harder to get external investment, which might make it more challenging for them to grow and expand.

limited liability company

A Limited Liability Company (LLC) offers flexibility and protection for business owners. Unlike sole proprietorships or partnerships, LLCs shield their members&#39; personal assets from company debts and legal issues, which is essential for safeguarding personal wealth.
The management structure of an LLC is adaptable, permitting either member management or appointed managers. This flexibility allows owners to choose the best management style for their business needs. To register an LLC, the registrant must select a unique business name, file the necessary paperwork with the state, and pay the required fees. This process officially establishes the LLC.
&#34;Eco-Friendly Cleaning LLC,&#34; established by three friends, is an example. This LLC structure allows them to manage the business collectively while protecting their personal assets. They filed the required documents and now run their business smoothly.
LLCs also have fewer compliance requirements than corporations, with less frequent meetings and simpler record-keeping. Although attracting large investors can be challenging LLCs remain popular for small business owners due to their simplicity and protection.

Limited Liability Company

A Limited Liability Company, or LLC, is a type of business structure that combines the flexibility of a partnership with the limited liability protection ...

Business

JoVE Business

Finance

Unit 1

Introduction to Business Finance

KEY TERMS AND CONCEPTS

understanding finance

Understanding Finance

Finance involves understanding how individuals and companies manage money to achieve their objectives.
At its core, finance includes saving, lending, and ...

areas of finance

Areas of Finance

Finance includes various areas for managing funds and assets effectively.
The three prominent domains within finance are business or corporate finance, ...

introduction to financial management

Introduction to Financial Management

Financial management in a company is crucial for overseeing its monetary resources to efficiently achieve financial objectives.
This process includes ...

introduction to financial accounting

Introduction to Financial Accounting

Financial accounting is the foundation for effective financial management, providing organizations with a systematic way to track, analyze, and report ...

accounting vs. finance

Accounting vs. Finance

Accounting and finance are two crucial functions that work hand in hand to ensure the success of any business.
Accounting is the process of recording, ...

financial management decisions

Financial Management Decisions

Financial management involves decisions related to the financial resources of an organization to achieve its objectives.
There are three main types of ...

internal and external users

Internal and External Users

Users of financial information include individuals, groups, or entities that rely on financial data to make decisions about a company&#39;s financial ...

role of financial managers

Role of Financial Managers

Financial managers play an essential role in companies by managing finances effectively to ensure sustainable growth and profitability.
They are ...

profit maximization vs. wealth maximization

profit-maximization-vs-wealth-maximization

Profit Maximization vs. Wealth Maximization

The profit maximization goal focuses mainly on increasing the amount of profit earned by a business.
It typically emphasizes short-term gains and is ...

forms of business organization

Forms of Business Organization

When starting a business, one of the critical decisions is choosing the correct form of business organization.
The choice of a business organization ...

sole proprietorship

Sole Proprietorship

A sole proprietorship is a business owned and managed by a single person.
The owner has complete control over the business and its operations.
Meet Sarah, ...

partnership

Partnership

A partnership is a form of business where two or more people join together to achieve common goals.
Each partner shares the responsibilities, profits, and ...

limited liability partnership

Limited Liability Partnership

A Limited Liability Partnership, or LLP, is a business structure that combines elements of partnerships and corporations.
Both partnerships and LLPs ...

corporation

Corporation

A corporation is a form of business recognized as an independent entity, separate from its owners.
When a business entity incorporates, it is ...

features of a corporation

Features of a Corporation

A corporation is a legal entity distinct from its owners, offering several key features.
Let&#39;s consider Nike Inc. as an example.
One of the main ...

s corporation

S Corporation

An S corporation is a type of business entity that allows companies to enjoy the legal protections of a corporation while being taxed like a smaller ...

non-profit organization

Non-profit Organization

Non-profit organizations or NPOs are organizations that serve the public interest or a specific social cause without the goal of making profits for ...

key terms and concepts

58 Views. A Limited Liability Company (LLC) offers flexibility and protection for business owners. Unlike sole proprietorships or partnerships, LLCs shield their members' personal assets from company debts and legal issues, which is essential for safeguarding personal wealth. The management structure of an LLC is adaptable, permitting either member management or appointed managers. This flexibility allows owners to choose the best management style for their business needs. To register an LLC...

Video: Limited Liability Company - Concept

finance

Jove Business Finance provides easy-to-understand animated lessons that explain how to apply finance principles in real-world scenarios. It explores the role of finance in business and delves into various aspects of financial decision-making. It also demonstrates methods for managing, investing, and allocating financial resources effectively. Through these lessons, learners gain insights into the basic concepts of finance and its importance in financial planning and analysis.

1.14 : Limited Liability Company

1.14 : Limited Liability Company

1.1 : Understanding Finance

1.2 : Areas of Finance

1.3 : Introduction to Financial Management

1.4 : Introduction to Financial Accounting

1.5 : Accounting vs. Finance

1.6 : Financial Management Decisions

1.7 : Internal and External Users

1.8 : Role of Financial Managers

1.9 : Profit Maximization vs. Wealth Maximization

1.10 : Forms of Business Organization

1.11 : Sole Proprietorship

1.12 : Partnership

1.13 : Limited Liability Partnership

1.15 : Corporation