4 Reasons Why an LLC is Right for Your Business

Forming a limited liability company or LLC can have many benefits for a wide range of businesses. There is a whole host of positives to forming your organization under this umbrella so understanding how different corporate structures could affect how your company operates. Today I will be covering an LLC. I am going to give you four reasons why an LLC is right for your business.

You Can Choose Your LLC Location

Because of the flexibility that comes with the title of an LLC you can choose your business location. This is improving because of the tax structures surrounding your business. Start-ups often create an LLC, with the help of companies like Inc Authority, because it helps avoid double taxation and can still support multiple classes of stock if needed. You might ask yourself, “how can you get double taxed?” Well, this happens because when an entrepreneur chooses a C-Corp business structure the company and the owner are both taxed separately at the end of the tax year.


Having an LLC does not let this happen, as it is taxed more like an individual proprietorship. Whilst this is better for the business, it might be confusing for the owner who is trying to report their taxes. For those business owners who aren’t confident with tax, it might be worth contacting a tax preparation company like H&R Block to see if they could help. There are even coupons from Raise to save people some money when they use H&R Block’s services. Perhaps that’s worth doing, especially now that your tax strategy will be a little different. It is a stress-free experience to change to a corporation somewhere down the line as well. So, there are basically no downsides when you are just starting out if you decide you would like a change.

Asset Protection

Many new businesses make the LLC structure to protect their personal assets against lawsuits directed at the company. Starting a sole proprietorship can be full of risk at the start. With possibly more risk involved than a general partnership. When an LLC gets to a certain size, most convert to either an S-Corp or a C-Corp. This is because there are limitations on mergers and acquisitions for LLCs. For those who have only just begun their journey into the business world, it would be great.

Simple Registration

An LLC is ideal for a startup company structure because it is simple and fast to set up. You often do not even need an attorney. You usually will register with your state, then you can get an employer ID Number (EIN) from the IRS, get business bank accounts and business checks. And just like that, you are in business.

In the state of Oregon, the cost of filing an LLC is only $100. The price will vary between states but with such an attractive low cost to start out, it can be easy to see why so many aspiring company owners adopt this strategy early on.

Fewer Regulations

Typically, LLCs have fewer regulations they must adhere to then corporations. For example, LLCs are not required to hold a shareholder meeting or establish a board of directors as a corporation would have too. LLCs can draft written operating agreements and take minutes, but they can make changes whenever they like.

Thanks to these looser regulations the management structure can be whatever you want for your LLC. This allows you to create a management structure that can help you grow in a way that works well for your team and industry. There are variations between states with what kinds of regulations affect LLCs. So, if you want to start an LLC yourself you will need to check with an attorney that understands the corporate law for the area you are interested in establishing your company in.

Ultimately, an LLC is a popular way for entrepreneurs to start their business because of the ideal position these new business owners are put in. Lower overall tax can make an LLC an attractive proposition for up and coming business owners. With a division between assets, ease of registrations and fewer regulations in general it is a no-brainer to start your company as an LLC.