LLC Incorporation
LLC Incorporation may be something you have been searching for. Or maybe it was LLC corporations, LLC incorporating or how to incorporate LLC and you have not been finding much information. There isn’t much available on LLC corporate information because an LLC is not a corporation. It is a Limited Liability Company.
The letters LLC stand for Limited Liability Company. While there are some similarities between a corporation and an LLC, it is important to recognize that LLCs and Corporations are two different types of business entities and there is no LLC incorporation.
Because LLCs and corporations run businesses and offer liability protection there are a number of similarities between the two. To run a business a small businessman requires asset protection. That is why both entities are used for business. That may be why some confuse the two businesses and use the word LLC incorporation. While the terms to the entities differ, both entities are organized by written documents filed with the state.
Why an LLC Incorporation is Incorrect
The corporation has Article of Incorporation, while the LLC has Articles of Organization. Both organizations are then operated from written documents. The corporation is run from it’s Bylaws while the LLC has an Operating Agreement. The corporation has officers and directors while the LLC has members and managers.
Both entities require some maintenance, including the requirement that you hold company and corporate meetings and keep minutes. All business resolutions for both entities need to be documented.
The corporation has a strict tax structure. One of the first things we learn in business law is that the owner of a corporation is taxed twice, once at the personal level and once at the business level. On the other hand, the owner of an LLC can choose how to be taxed. This choice can be very beneficial.
Limited Liability Companies (LLCs) are probably the most flexible asset protection entity of the two. They give you much better asset protection than a corporation. They give you accounting options a corporation doesn’t even approach. The LLC is a lot easier to maintain than a corporation.
There are reasons to use corporations, but your first thought when you think business entity should be “LLC.” Just take time to study it out. It is important to understand all the disadvantages, as well as the advantages, because you need to know the whole truth about any legal structure you use.
