Finance: What is an LLC?

What is an LLC? LLC stands for Limited Liability Company. It is a hybrid type of company that combines the corporate protections of separating corporate and personal assets and liabilities with tax advantages and other elements of partnerships and sole proprietorships. The LLC’s tax liabilities are paid at the shareholder’s personal level, so the LLC only files returns without payments. Unlike the corporation, the LLC cannot outlive its founders unless there are continuation agreements. Additionally, new shareholders can be added without corporate resolution in the LLC.

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Transcript

00:29

building your own company as an individual and not as an LLC and you get

00:34

sued for whatever, and you lose well you could lose everything you own.

00:38

that is the lawyers will come after your house your car your poodle your signed

00:43

Mila Kunis photograph collection, and legally well they'll be entitled to take

00:48

all of it. if you have existed under the legal structure of an LLC however, well [legal structures pictured]

00:53

the most you can be liable for is the assets of the business itself. yes

00:58

they'll take the company computer the remaining 17 months of lease on the

01:02

company building, and all your staplers and posted thingies but legally they

01:06

won't be able to go after your home your car your poodle or your autograph

01:10

collection. Mila is safe whew. so LLC's are a good thing they cost only a few

01:16

hundred bucks to set up these days, hi LegalZoom. so before you start up a lava

01:20

lamp company of your own think about setting up an LLC first. Mila and your [lava lamps in a row]

01:25

poodle gregory will thank you for it.