Is An LLC Right For Me?
When you are ready to start your Florida business, it can feel a bit overwhelming to try and determine which business entity is right for your enterprise. A limited liability company (LLC) is one of the more popular choices, particularly for businesses with multiple officers, offering many different benefits. However, there are little details involved in creating an LLC that can be easy to miss – a knowledgeable attorney is a must to have on your side, to help ensure that your business is legally sound.
Advantages: Flexibility
The main advantage of an LLC is that the business will be structured in a way that shields members and managers from personal liability. Any debt or other liability owed by the company is only collectable from the company itself, rather than from any individual actor in it. This is true even if the LLC does not observe proper formalities or registration requirements; the mere fact of intending to operate one’s business as an LLC is generally enough to receive its protections.
One of the other most appealing features of an LLC is how flexible it can be. Unlike with other business entities, an LLC needs only one member to be created. Regardless of the number of members in an LLC, though, the company has more latitude – for example, profits in a partnership are usually split 50-50, but in an LLC, multiple methods of profit sharing are possible based on the will of the members.
Disadvantages: Monetary
While there are many advantages to operating your business as an LLC, there are disadvantages as well, with perhaps the primary concern being expenses. In Florida, LLCs are required to pay more to incorporate, as well as higher renewal fees and other upkeep costs, than a sole proprietorship or partnership. In general, LLCs require more state filings and reports than other types of business – an annual report is required every September, with the possibility of dissolution if the report is not submitted.
The other major turn-off for business owners is that LLCs generally operate on what is known as ‘pass-through’ taxation. Pass-through taxation means that profits and losses are “passed through” the company, onto the federal tax returns of its members. While for some, this may be an advantage, it can be difficult for lower-income members or those with fingers in several different pies, so to speak.
Contact A Seminole, FL Business Formation Attorney
Countless businesses operate as LLCs, and indeed, this might be the right choice for your business as well. That said, a Florida business formation attorney from the Hunt Law Group can help you evaluate all your options, so that your enterprise has the best chance to flourish. Contact our office today at (727) 471-0444 to schedule a consultation.
Source:
flsenate.gov/Laws/Statutes/2021/0605.0304
