Thinking of starting an LLC in Florida? In this article, discover some of the reasons why a limited liability company might be the right structure for you.
A limited liability company is often the best structure for small business owners who want to protect themselves while enjoying some of the benefits of corporate ownership. There’s a reason limited liability companies are the most popular business entity in the Sunshine State.
Easy to form and maintain and relatively inexpensive, LLCs are an excellent option if you are looking to protect your personal assets, reduce your tax burden, and give your business the flexibility and credibility it needs to thrive.
If you are curious about starting an LLC in Florida, read on to learn some of the benefits.
4 Smart Reasons for Starting an LLC in Florida
1. Pass-Through Taxation
Like sole proprietorships and partnerships, LLCs are subject to pass-through taxation. Corporations on the other hand are subject to double taxation—profits are taxed at the corporate level before being distributed and on each owner’s individual tax return for distributions made.
LLCs are flexible in that they can also choose different tax designations, such as what is known as an S corporation. Under the right circumstances, this tax status essentially reduces the overall tax burden your business faces.
2. Business Management Flexibility
LLCs do not restrict how you choose to structure your business’s ownership and management. You can choose to have the business managed by the members or as manager-managed, including by other individuals that are not the members of the business. It is also very convenient when you want multiple members active in the operations and management of the business.
3. Increased Credibility
Starting an LLC in Florida can also lend your business credibility. Both banks and consumers are more likely to do business with a limited liability company than with a sole proprietorship. Forming an LLC promotes certain corporate formality that can be trusted.
4. Limited Liability Protection
When a sole proprietorship or partnership suffers a business loss, the business owners can be held personally liable for it. As the name implies, a limited liability company limits the liability of the owner. In other words, the business entity protects the owner’s personal assets.
It is critical to understand, however, that an LLC owner’s assets are only protected as long as the business maintains its corporate veil. If the owner’s actions are found to be fraudulent or wrongful, for example, creditors may pierce the corporate veil and pursue legal action against the owner or owners.
Thinking of starting an LLC in Florida? Get the expert legal guidance you need.
Owning a business often carries a substantial risk and financial burden. If you want to protect yourself and reduce your potential tax burden, you should consider whether an LLC business structure is right for you.
Interested in starting an LLC in Florida? Contact the Saltiel Law Group today to schedule a consultation.