Creating a limited liability company (LLC) is an ideal option for those ready to separate their business and personal assets formally but do not plan to enter the international market or attract external investment. The creation of an LLC can significantly reduce the tax burden. You need to weigh all the pros and cons of creating an LLC just for your business.
What is LLC?
It is a legal entity that has its taxpayer identification number and bank account. Also, LLC has the right to conduct business on its behalf. It can be called a kind of “hybrid” of corporation and partnership. Like a corporation, an LLC limits the legal obligations of its owners. Like a partnership, an LLC is also an intermediate subject for taxation. It means that individual members are taxed only once on any LLC profits (unless otherwise specified in the operating agreement).
Three main advantages of LLC:
Two main disadvantages of LLC:
To understand if setting up an LLC is right for your business, you will need to answer questions about your current situation and your business plans for the future.
The cost of setting up an LLC depends on the number of participants, plans for investments, and the nuances that must be provided for in the shareholder agreement. To better understand the cost for your specific situation, please consult.