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PDtax
PDtax, Master's Degree
Category: Business and Finance Homework
Satisfied Customers: 1891
Experience:  MBA/CPA, Former college instructor and tutor.
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describe an LLC

Resolved Question:

You learned from your readings that several types of businesses exist. One unique type is the limited liability company (LLC). Perform some research in the University Library and find an article describing an LLC. Post the article name and the database in which you found it. Discuss what you learned about LLCs from the article.

Submitted: 9 months ago.
Category: Business and Finance Homework
Expert:  PDtax replied 9 months ago.

PDtax :

Welcome to the site. I'm PDtax, and will be helping you today.

PDtax :

The Many Benefits of Forming an LLC, Entrepreneur Magazine, august 15, 2004, http://www.entrepreneur.com/article/72134. Found with google search.

Customer:

are you also going to explain to describe the llc as the question asks. the request specifically asks what was learned from the article. it doesn't need to be lengthy. maybe 200-300 words. I need more than just the article. sorry! maybe I am misunderstanding what you are stating!

PDtax :

The article begins with the benefits to a sole proprietor of , forming a single member LLC. Per the author, traditional tax treatment remains (it can, but does not have to) and adds the benefit of personal liability protection. The author opines that loss passthrough can be used by the owner to offset other income, and income is taxed at the owner's marginal rate, as opposed to another entity housing the business that might have its own tax to pay.

PDtax :

The article goes on to explain the benefits of LLC usage for an entity with multiple owners, which include limited liability protection and your choice of partnership (pass through similar to the sole proprietorship, but based on an owner's ratable share of income) or corporate taxing form (if so elected).

PDtax :

If retention of earnings to support growth is desired, the author suggests C corporation election. The author does not recognize that this can be achieved in partnership form as well. Many partnerships or S corporations distribute only enough cash to pay the income tax on the entity earnings, retaining cash for business use. The S corporation is in my opinion more attractive, since the income is taxed once, without the self-employment burden of partnership treatment, and funds can be retained. There may be a marginal tax difference on the income, but the tax due on the second distribution will many times be more expensive.

PDtax :

The author does give a good overview of the benefits of LLC entity use, and the elections that are possible for tax treatment.

PDtax :

Thanks from just Answer. please review and ask any questions, or post positive feedback. I'm PDtax.

PDtax :

Sorry, the author's name isXXXXX

PDtax :

Is there anything else you need?

PDtax, Master's Degree
Satisfied Customers: 1891
Experience: MBA/CPA, Former college instructor and tutor.
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