Typical LLC Structures
LLC business models are often one of the most common business structures found in America. LLCs are popular for their safety and asset protection. In a lawsuit, personal assets of the members are shielded from the liabilities of the business. LCCs also are used for their flexibility with taxation methods. Owners can choose to tax the LLC as a corporation or sole proprietorship. The flexibility of an LLC has made it one of the most desirable organizational methods in most states.
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Partnerships
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LLCs can be organized under a partnership and operate with multiple owners. Partnerships are a common structure in LLCs due to the ease of funding and revenue-sharing. Partnerships do lose the option of allowing the funding to flow through the owners income tax and are subjected to double taxation. All revenue is taxed at the corporate level and again at the personal income level.
Single-Member
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Single-member LLC structures are ideal for business owners who are looking to increase the size of their sole proprietorship and protect themselves from some of the risks of the business. In single-member LLCs, owners can choose to tax the business as a sole proprietorship and reduce the amount of taxes that they would have to pay as a corporation.
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Married Couples
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Married couples can create an LLC as a single member and have the revenue flow through their personal income. This method for LLC organization helps create a business structure that allows husbands and wives to run a business with liability protection and avoid the double taxation of a corporation. This business model also allows preexisting businesses that are being run by husband and wife to upgrade their business model and keep the organization simplistic.
Managers
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LLCs are set up with managers, defining those managers and their functions in the LLC's articles. The method for adding a manager should be clearly defined in the business articles, along with their functions and rights. Most LLCs have a few managers and are one in the same with the owners of the LLC. Most LLCs are organized as manager-operated organizations and transfer the decision-making power to the managers. The LLC's organizational paperwork should also describe how meetings of the managers should take place, along with the method for how decisions are made.
Member
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LCCs also have the option of adding members, who will have the ability to handle formal business for the LLC and can be relayed special rights and abilities. Members'
functions should also be clearly identified in the business's organizational articles.
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References
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