A limited liability company (LLC) is a business structure in the United States that protects its owners from personal responsibility for its debts or liabilities. It is a hybrid entity that combines the characteristics of a corporation with those of a partnership or sole proprietorship. LLCs are not corporations under state law; they are a legal form of a company that provides limited liability to its owners in many jurisdictions. LLCs are well known for the flexibility that they provide to business owners. Some key features of LLCs include:

• Limited Liability: LLCs provide their owners with limited liability in the event the business fails. The responsibility for the companys debts or liabilities falls on the LLC, meaning the firm is its own legal entity.

• Pass-through Taxation: LLCs can combine the pass-through taxation of a partnership or sole proprietorship with the limited liability of a corporation. This means that the profits and losses of the LLC are passed through to its owners and are taxed as part of their personal income.

• Management Structure: LLCs can be managed by members or elect a management group to do so. Members oversee daily business operations when an LLC is managed by members.

LLCs are permitted under state statutes, and the regulations governing them vary from state to state. LLC owners are generally called members, and many states dont restrict ownership, meaning anyone can be a member including individuals, corporations, foreigners, foreign entities, and even other LLCs. Some entities, though, cannot form LLCs, including banks and insurance companies.