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Even today, there are still residual side effects from the Great Recession, which peaked in 2008. While this is true, people are still more optimistic about the overall business client in the U.S., even though a large amount of the weather hasn’t spread to the nation’s middle or poor class.
Even though this is true, approximately 27 percent of people recently surveyed believe that today, economic conditions are good to excellent. As a result, many of these individuals are using the improved economic market as the opportunity to begin an all new business.
If you have decided that owning a business is the right option for you, you have to consider the type of corporate structure you want to set up. One option is the LLC, or the Limited Liability Corporation. Here you can learn more about LLCs and why this business structure may be right for you.
- Avoid Issues Related to Double Taxation
Depending on how your company is established and the total number of investors/employees there are, you can start a small business as an LLC and avoid double taxation. In most cases, this occurs if you opt for a C-Corp business structure, where the business and owner are taxed separately.
With an LLC, you can prevent this situation. Instead, you will be taxed the same as a sole proprietorship. This is especially beneficial if you are planning to use a startup accelerator.
- Ability to Choose Your LLC Location
Another question you have to answer is what state you will establish your entity in. While Delaware has been at the forefront of incorporation due to the low costs, there are a number of states that are following this state’s lead. This is beneficial if you want to incorporate your business as an LLC closer to your home.
It may be a good idea to consult with a professional before moving forward. They can help you with this and ensure you are doing what’s best for your newly formed business.
- Make Changes with Ease
Another appealing benefit of an LLC is that once you have set it up, there’s very little maintenance. Even more importantly, it’s simple to add new partners to your company or sell interest or even the entire entity to another person/company.
This is a more relaxed structure than a C-Corp because you don’t have to have minutes or go to the board for important decisions. With an LLC you will have fewer restrictions, which makes it a popular option.
- Easily Protect Your Assets
There are some startup owners who create an LLC structure to help protect their personal assets from lawsuits that are directed at the business or company. In many cases, sole proprietorships are risky because if a lawsuit is filed, a person may lose everything – including their home and other personal assets.
With an LLC, it is limited what can be include in the lawsuit, adding more protection to the owner.
- Register Your Company with Ease
LLCs are ideal because the process of getting it set up and filed is simple and fast. You can even do this without hiring an attorney – for example by filing the paperwork yourself or hiring an online LLC service. This makes it an appealing option for a wide array of business types.
As you can see, setting up your business as an LLC makes sense in several different ways. If you are considering opening a business, be sure to consider the information here. This will ensure you make the right decision for your newly formed company.