Limited Liability Corporation and Partnership

Essay by nikkielliott1104University, Bachelor'sA+, January 2014

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Limited Liability Corporation and Partnership

B. Nikki Elliott

FIN/ 419 - Finance for Decision Making

Thien NGO

Limited Liability Corporation and Partnership

Business are being started every day in all parts of the world. The majority of the business started are done so in the form of sole proprietorship as well as general partnership. When businesses are started this way all it means is that the liability of the business falls directly on the owners involved. To be protected from this the owners have the limited liability corporation (LLC) and the limited liability partnerships (LLP). Discussed further will be the difference in both and how they are involved in business decisions.

Limited Liability Corporation

When forming a LLC the owner much file all of the proper paperwork and pay the required fees in whichever state the business will operate or whichever state the main office will be. A huge benefit a corporation has is the ability to raise capital which will benefit the company to making a larger profit.

The only negative that comes with a corporation is that they are subject to government fees and regulations as well as they have to share all of the financial records of the company with the public.

Using a LLC while a business grows will help the business owner to limit the amount of liability that the owner is responsible with. The great thing about an LLC is that it is a complete separate entity from the owner and allows the owner to only be held accountable for what they actually invest into the company. The LLC helps keep the owner out of the law's ways, from being sued, since the corporation is a separate entity it can be sued by other parties. The LLC allows for the corporation to continue to...