A limited liability company is also known as LLC is the most popular way of incorporating new business start-ups and small businesses. According to Piloto Asia, registering as LLC protects the owners from the liabilities of the company as the company is regarded as a separate legal entity.. The incorporation procedures are simple and registering an LLC provides ease in management of the day-to-day operations of the company. The tax treatment of these companies is also simple and flows through the returns of the owners. Owing to a lot of benefits and simplicity in a registration process, many new entrepreneurs prefer to incorporate their business as LLC. If you are a new entrepreneur and want guidance in incorporating your business as LLC in New York, contact Windsor corporate services.
Features of an LLC
- Registering as an LLC creates a separate legal identity for the business. An LLC is a different entity from its owners. It can buy and sell properties, add and delete members and contract employees to carry on its day to day functions. The laws governing LLCs vary from state to state but an LLC continues to exist even if the members withdraw from the board.
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- Since the LLC is a separate entity, the income, and expenses, assets and liabilities of the company are of the company alone. The owners, members, and employees of LLC are not liable to clear the debts or liabilities of the company in the case of the company going into losses. This limited liability protects the owners of LLCs as they will not be obliged to sell their private properties to clear the liabilities of the company. Any lawsuits on the LLC are in the company alone and the owners are protected from them.
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- The income of the LLCs flows through the returns of its owner. This income is shown as the normal income of the member. This flow-through mechanism avoids the double taxation that takes place in the case of INC and makes it simple for the members to file the returns. If the LLC has many members, they have the flexibility to choose the form of taxation between S Corp and C Corp rules.
- The process of registering and operating an LLC is simple. To register an LLC, the members need to fill the articles of organization with the State of New York. They can also fill the form online with the help of Windsor corporate service at https://windsorcorporateservices.com/form-an-llc-in-ny/. The corporate service company also helps the new entrepreneurs with other key formalities like correspondence with taxation and legal authorities and meeting the publishing requirements. They also help to submit a registered address and an operating agreement detailing the key issues in the functioning of LLC.
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- There is no compulsion for an LLC to appoint a board of directors and conduct the annual general meeting yearly. The members of the LLC can appoint managers to look of the regular operations of the business by mentioning about it in the operating agreement. The LLC can also add and delete members with simple alterations in the operating agreement. An LLC is also spared from the stringent rules and regulations to be followed by an INC like the filing of minutes, strict book keeping measures and accounting practices.
Owing to these advantages, incorporating their business as LLC is most suitable for new entrepreneurs running a small business. They get the required protection with limited liability along with ease in operating the day to day transaction of the business and simplicity in taxation procedures.