Limited Liability Company

Definition

LLC. A type of company, authorized only in certain states, whose owners and managers receive the limited liability and (usually) tax benefits of an S Corporation without having to conform to the S corporation restrictions. An LLC is an unincorporated association, is relatively flexible and simple to set up (making it appealing for small businesses with only one owner), and allows for pass-through income taxation. LLCs were not widely used in the United States until the early 1990s.

For more information, see The Difference between an S Corporation and an LLC.

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They were a limited liability company and I didn't think they would be, since our state did not authorize it.

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The Limited Liability Company operated in a special way that took on some risk but hedged their potential losses individually.

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The idea of setting their business up as a limited liability company, with less restrictions, was very appealing to the couple who were planning on starting their own business.

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