The good thing about forming Limited Liability Company is the benefits to separate and protect your personal assets. Your company also gets the potential on tax and lends the LLC abbreviation to be included on the last part of your business name. In this way you have the chance to widen the company’s credibility that may help when you apply bank loans. LLC aims not just to protect individual liability but as well as the tax treatment and easy access to potential partnerships. Read more about LLC in Sunbiz.org. But it is better before you decide to form this kind of company, you have to know what you can get from it. Below are the good and drawback sides about LLC Florida.
What good can you get from LLC?
- The pass-through taxation. All members will report individual their share on LLC for their income tax return. It does not have the double taxation incurred by the S corporation when it comes to income tax.
- Flexibility. They are more flexible than others when it comes to members being allowed to join in the company. They have the structuring management to handle the members which select various level of distribution for the profits.
- Less formalities. The company does not use the resolutions and minutes for easy member management. But when it comes to big business transactions it is recommended. Yearly meeting is also conducted.
What are the drawbacks?
- Minimal protection on case law. It is one of the newer entities on the business that is why there are still less case law inside.
- Expensive filing fees. It is expensive compared to sole proprietorships and partnerships.
- Transfer of ownership is being limited. Ownership has harder transfer than the corporation. You have to know whether the transfer needs approval from the members or can be transferred immediately.
These are what you can get from LLC. You can find more information from the Florida Divisions of Corporations and other options in case you are having second thoughts about LLC.