What is an LLC?
What is a Limited Liability Company?
An LLC is short for limited liability company. An LLC is a legal entity having one or more individuals or entitles that come together to do business. We refer to LLC owners as “members”.
How does an LLC protect you?
The LLC member(s) are limited in their personal liability for judgments, debts, obligations or LLC liabilities. This liability protection is one of the reasons why people decide to set up LLCs to run a business. The goal is to shelter your personal assets from any liability that may emerge from the business.
For example, John sets up a legal entity, or LLC, to operate his dog grooming business. If John harms a client’s dog which results in a lawsuit. John is limited to his membership interest in the liability. So John has segregated his personal assets from his business liability.
So, an LLC is a great asset protection tool. However, some business are better suited for LLC structure whereas others are not. It is always best to consult with our office prior to deciding whether an LLC structure fits your business needs.
And of course must establish your LLC correctly. It is imperative that you establish your LLC with the requisite legal requirements including a detailed operating agreement that provides the legal limitations to protect your personal assets.
So, if you are an individual with a business venture and want to form an LLC, contact our office for a consultation. We can help you with your asset protection planning.
Feel free to contact our office for a free consultation to discuss your asset protection need and the establishment of a limited liability company.