Kelan Roy CPA - LLC Limited Liability Company

Kelan Roy CPA .Com

Limited Liability Company

	HOME

	TAX SERVICES

	BUSINESS SOLUTIONS

	TECHNOLOGY MANAGEMENT

	TREATY TRADER/ INVESTOR VISAS

	FAQ

	FIRM PROFILE

	CONTACT

	UNDERSTANDING THE CPA CLIENT RELATIONSHIP

	LINKS

Limited Liability Company (LLC) is a hybrid between a corporation and a limited partnership. Members are afforded the limited liability of corporate shareholders and the pass through tax advantages of a partnership without the restrictions imposed on limited partnerships and Subchapter S corporations. Management and ownership may be structured in any fashion as specified in the Operating Agreement, thereby allowing for total flexibility in income distribution.

Advantages of a Limited Liability Company
The entity may have any number of stockholders, unlike a sub S corporation that is restricted to a maximum of 75 investors. In addition, corporations, partnerships, certain kinds of trust, and non-resident alien individuals are prohibited from being shareholders of a sub S corporation. Limited Liability Companies are not subject to these restrictions.

Limited Liability Companies do not required the appointment of a generalpartner with unlimited liability as in a partnership structure. The manager of a Limited Liability Company does not have to maintain a percentage interest in the entity; therefore the personal assets of the manager can be shielded from creditors seeking payment of a Limited Liability Company debt. Limited Liability Company members also enjoy limited liability for any debts of the company.

Limited Liability Companies can specifically allocate any distribution ofincome, gain, deduction, or loss among its members. Whereas corporations organized under Subchapter S of the Internal Revenue Code are limited to distributing items on a prorata per share per day basis.

Whereas a general partner may not be removed by members of the Limited Partnership, an LLC is not required to declare a general partner. Managers designated by members of an LLC may be subject to removal if desired.

Flexibility of the structuring of the LLC’s management and ownership can be a great asset in planning for closely held and family owned businesses.
The ability to chose the federal tax treatment of the LLC as either a pass thru entity or corporation.

Back to Tax Services

HOME TAX SERVICES BUSINESS SERVICES TECHNOLOGY MANAGEMENT CPA FIRM PROFILE

CONTACT INFORMATION:

Kelan Roy, CPA MT

Certified Public Accountant
Midland, Texas
Email Kelan