Limited Liability Company (LLC)
Definition:
A Limited Liability Company (LLC) is a business structure that combines the limited liability protection of a corporation with the flexible management and tax benefits of a partnership. Owners, known as members, are generally not personally liable for the company’s debts or legal obligations.
Limited Liability Company (LLC) Information
An LLC is a popular business entity because it provides flexibility in management and taxation while protecting personal assets from business liabilities. Members can manage the company themselves or appoint managers, allowing for operational freedom.
Unlike corporations, LLCs do not require annual shareholder meetings or strict record-keeping formalities. They can choose to be taxed as a sole proprietorship, partnership, or corporation depending on what best fits their financial strategy.
This structure is particularly attractive to small business owners, real estate investors, and professionals seeking personal liability protection without the administrative burden of a corporation.
Florida Legal Definition
Under **Florida law**, a Limited Liability Company (LLC) is defined and governed by the **Florida Revised Limited Liability Company Act**, found in **Chapter 605, Florida Statutes**. The law provides that an LLC is a separate legal entity from its members, shielding them from personal liability for business debts and obligations.
An LLC in Florida can be formed by filing **Articles of Organization** with the **Florida Division of Corporations (Sunbiz)**. The company must maintain a registered agent and comply with annual reporting requirements. Florida law also allows single-member LLCs and multi-member LLCs, with great flexibility in creating **Operating Agreements** that define management, profit distribution, and dissolution terms.
How It’s Used in Practice
LLCs are widely used in Florida for business formation, real estate ownership, and asset protection.
- Entrepreneurs form LLCs to limit personal liability for business debts or lawsuits.
- Real estate investors use LLCs to hold property titles and separate assets for legal protection.
- Professionals and small business owners choose LLCs for tax flexibility and ease of management.
- Florida LLCs can elect to be taxed as S corporations to reduce self-employment taxes.
- Attorneys recommend LLCs for estate and succession planning to streamline ownership transfer.
Key Takeaways
- An LLC provides limited liability protection to its members while offering flexible management and taxation.
- It is formed in Florida under Chapter 605, Florida Statutes by filing Articles of Organization with the state.
- LLCs can be single-member or multi-member entities with customizable operating agreements.
- They are commonly used for business operations, real estate holdings, and asset protection.
- LLCs offer simplicity, flexibility, and liability protection compared to corporations.
Disclaimer: The information and opinions provided are for general educational, informational or entertainment purposes only and should not be construed as legal advice or a substitute for consultation with a qualified attorney. Any information that you read does not create an attorney–client relationship with Barnes Walker, Goethe, Perron & Shea, PLLC, or any of its attorneys. Because laws, regulations, and court interpretations may change over time, the definitions and explanations provided here may not reflect the most current legal standards. The application of law varies depending on your particular facts and jurisdiction. For advice regarding your specific situation, please contact one of our Florida attorneys for personalized guidance.
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