What Are Limited Liability Corporations?
A limited liability company, or LLC, is a corporate structure used by many small businesses to help eliminate the owner’s personal responsibility for business debts or lawsuits against the business. An LLC requires more paperwork to establish than a sole proprietorship or partnership, but the liability protection gained makes the time spent well worth it for many small business owners. Limited Liability Limited liability companies are named for the primary business reason for the structure–protecting an owner’s personal assets from business creditors and lawsuits. In the case of a lawsuit or bad debts, only the assets of the LLC can be used to pay creditors or judgments, except in certain cases. If the owner personally signed for business loans or lines of credit, that owner can be held personally liable for the debt. If the owner failed to deposit payroll tax withholdings with the Internal Revenue Service and the state, he can be held personally liable for the amounts due. If the own
