Limited Liability Companies are a relatively new form of business entity that state legislatures, including Georgia’s, began to enact laws for in the early-to-mid 1990s.  Georgia’s LLC Act borrows some aspects of the traditional corporate structure and some aspects of the traditional partnership structure, creating a “hybrid” entity under Georgia law.  It can be said that the LLC has some of the “best” qualities of each of these traditional forms of business.

Here are Ten Advantages of LLCs, which may benefit for your new business:

  • Personal Liability Protection

    An LLC provides its members protection against personal liability from the debts and liabilities of the business.

  • Protection of a Single Owner

    An LLC can consist of only one member, who may still enjoy the protections against personal liability.

  • No Restrictions of Amount of Members

    An LLC can have an unlimited number of members, whereas burdensome restrictions are placed on corporations exceeding 100 shareholders.

  • Flexibility Through Contract

    The LLC form allows members wide-discretion to contractually agree upon the terms of their business through an Operating Agreement.

  • Structural Flexibility

    Members of an LLC may select various forms of distributing profits, unlike traditional partnerships where profits are split 50-50.

  • Tax Elections

    An LLC with multiple members will be taxed as a partnership or they can elect to be taxed as a corporate entity.

  • Less Formalities

    An LLC is not required to have the formalities and maintenance requirements that a corporation must have to exist.

  • Diversity of Ownership

    Non-U.S. citizens/residents can be members of LLCs; S-corporations may not have non-U.S. citizens/residents as shareholders.

  • Flexibility in Management

    Owners of an LLC may manage the LLC themselves, elect other members to manage or chose to have managers manage the LLC.

  • Entity Ownership

    A corporation or partnership may be an owner (“member”) of an LLC.