Limited Liability Companies

A Limited Liability Company, or LLC, is a private limited company. It combines the pass-through taxation of a sole proprietorship, with the limited liability of a corporation. Understanding when to choose an LLC over other types of business entities can be difficult. The team at SAPG Legal can help explain the benefits of and LLC and help you decide whether or not an LLC is right for you.

An LLC is a type of hybrid business entity bringing characteristics of both a corporation and a partnership or sole proprietorship. Primarily only sharing one key aspect with a corporation, its limited liability.

Unlike a corporation, LLCs are treated as a pass-through entity for tax purposes. This means that the income of the entity is treated as the income of the investors or owners. Depending on local tax regulations this structure could help to avoid dividend tax and double taxation. For this reason LLCs as a pass-through entity are considered to be “non-entities” for tax purposes.

LLC’s also have the benefit of being a fluid structure. Owners, or members, can divide the LLC into voting and non-voting ownership, working interest or just equity interest, along with other changes, which are more difficult to implement under a corporation.

Advantages of an LLC


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