1.14 : Limited Liability Company

A Limited Liability Company (LLC) offers flexibility and protection for business owners. Unlike sole proprietorships or partnerships, LLCs shield their members' personal assets from company debts and legal issues, which is essential for safeguarding personal wealth.

The management structure of an LLC is adaptable, permitting either member management or appointed managers. This flexibility allows owners to choose the best management style for their business needs. To register an LLC, the registrant must select a unique business name, file the necessary paperwork with the state, and pay the required fees. This process officially establishes the LLC.

"Eco-Friendly Cleaning LLC," established by three friends, is an example. This LLC structure allows them to manage the business collectively while protecting their personal assets. They filed the required documents and now run their business smoothly.

LLCs also have fewer compliance requirements than corporations, with less frequent meetings and simpler record-keeping. Although attracting large investors can be challenging LLCs remain popular for small business owners due to their simplicity and protection.