| First of all, if you're new to the realm of official | | | | 4) Tax flexibility- Ability to receive Sole Proprietor, |
| company formation and incorporation, LLC stands for | | | | C-Corporation, or S-Corporation status with the IRS |
| "Limited Liability Company". Some people mistakenly | | | | The standard LLC is recognized as a partnership by |
| say "Limited Liability Corporation". A LLC is technically | | | | the IRS, however you can also elect to be considered |
| not a "corporation", but it is a legal business entity | | | | a Sole Proprietor if only one person, or a |
| providing liability protection to it's owners. | | | | C-Corporation or S-Corporation for tax purposes. |
| So, what are the 5 Reasons for starting your own | | | | 5) Flexible ownership structure |
| business as a LLC formation? | | | | A LLC Formation has more flexibility than a |
| 1) Reduced Liability | | | | corporation in the ownership and organizational |
| One of the most important reasons to form a Limited | | | | structure that you want to establish. It's up to you how |
| Liability Company is the reduced liability owners have | | | | much ownership and control you want to give to each |
| for the risks of the business. Protect your and your | | | | person. |
| family's finances by legally starting your business as a | | | | Those are 5 Reasons to start your own business as |
| LLC (Sole Proprietors do not enjoy this liability | | | | a LLC formation. I hope you find this list informative and |
| protection). | | | | useful. As always, be sure to educate yourself with |
| 2) No double taxing | | | | good research, surround yourself with professional |
| A standard LLC is a "Pass-Through Entity" as far as | | | | advice, and think through the options carefully before |
| the IRS is concerned. This means that the company is | | | | making such an important decision with your business. |
| not recognized for taxes. Only the "members" pay | | | | Thanks for reading about why to incorporate your |
| taxes on the income that comes to them (or count as | | | | business as a LLC formation! |
| deductible any losses incurred). There's no "double | | | | (While the above is intended to help educate you to |
| taxing": the company paying taxes on profit then the | | | | make an informed decision and written to provide as |
| individuals paying taxes on their income. | | | | accurate and valuable information as possible, please |
| 3) Can be Formed in Any State | | | | do not consider any of the above as professional or |
| You can choose in which state you want to form a | | | | legal advice. Always be sure to get advice from |
| LLC based on what's best for your situation. Many | | | | authorized professionals whom you know to be |
| people recommend Delaware or Nevada as two of | | | | trustworthy. |
| the most favorable to businesses. | | | | |