| Is an LLC a Corporation? The answer is technically | | | | The corporation entity subjected small business |
| NO but the limited liability company offers all the | | | | owners to onerous requirements and formalities often |
| advantages of a corporation without the | | | | not needed for the typical small business. |
| disadvantages. | | | | The state legislatures recognized this and in attempts |
| The corporation is an age old legal entity that has been | | | | to further support the small business growth in this |
| around for ages primarily to afford limited liability to | | | | nation, looked to enact laws to provide for a more |
| businesses and offer them a way to eventually | | | | suitable limited liability entity for the small business. |
| become public. A corporation has shareholders as | | | | Wyoming was the first state to enact laws allowing |
| owners and issues shares of stock as ownership | | | | for the creation of the LLC and now, the number of |
| interests. | | | | limited liability formations has surpassed corporations. |
| On the other hand, the LLC, which is short for limited | | | | This is because the LLC provides more of what is |
| liability company, is a relatively newer type of legal | | | | typically needed for a small business and does not |
| entity that was not available until the 1970s. However, | | | | require anything else. At the same time, it has the ability |
| do not let the young age of the LLC fool you. | | | | to change and grow and accommodate complexity as |
| You see, entrepreneurship is the main driver of the | | | | a business grows. |
| economy in the US. Yet before the LLC, the only way | | | | Is an LLC a corporation? No, but for most small |
| entrepreneurs could obtain personal liability protection | | | | businesses, it is a better choice than a corporation. |
| was to incorporate their business with a corporation. | | | | |