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A limited liability company (LLC) is a type of business entity you can register in your state. The main purpose of an LLC company is to limit the personal liability of its owners—like a corporation—but it also allows the business to operate with simpler, more flexible tax requirements.
An LLC isn’t always required, but many small business owners form an LLC for personal liability protection. Having an LLC can also help you open bank accounts, enter into contracts, hire employees, and get necessary business licenses and permits.
By forming an LLC and keeping your personal finances separate, your personal assets are protected from business liabilities.
Compared to corporations, LLCs are typically easier to start and have simpler rules for things like record-keeping.
You get to decide how you’re taxed—as an LLC or a corporation—to maximize your potential savings and minimize tax liability.