answersLogoWhite

0


Best Answer

A limited liability company (LLC):

  • is a type of business ownership combining several features of corporation and partnership structures
  • is not a corporation or a partnership
  • may be called a limited liability corporation, the correct terminology is limited liability company
  • owners are called members not partners or shareholders
  • number of members are unlimited and may be individuals, corporations, or other LLC's

A limited liability company is a corporate structure whereby the members cannot be held personally liable for the company's liabilities or debts. The laws that govern vary in different jurisdictions. It is similar to a corporation in some respects but not all. If you are interested in forming an LLC you should consult with an attorney who specializes in business law.

In general, limited liability is a type of liability that cannot exceed the amount that has been invested in a partnership or limited liability company. Limited liability protects personal assets from the risk of being seized to satisfy creditor's claims, debts and other obligations. For privately or publicly held corporations, a shareholder's responsibility for the company's debts is limited to the par value of paid up shares. The company itself as a legal entity is liable for the rest.

User Avatar

Wiki User

โˆ™ 2014-12-30 16:27:06
This answer is:
๐Ÿ™
0
๐Ÿคจ
0
๐Ÿ˜ฎ
0
User Avatar
Study guides

Business Plans

20 cards

What does ergonomics mean

What are the feasibility study and define each

What are the principles of ergonomics

Who organizes manages and assumes the risk of a business or enterprise

โžก๏ธ
See all cards

Math and Arithmetic

30 cards

What is a dividend

How do corporations raise money

If you buy 1000 shares of a stock with a 10 Commission and then sell 100 of it with a commission of 10 and then sell 900 later with a 10 comission what is the cost basis of the 100 and 900 shares sold

To whom and how are dividends usually paid

โžก๏ธ
See all cards

Business and Industry

31 cards

What is a stock

What percentage of the GNP comes from small business in the US

What allows only a certain quantity of an item to be imported

To whom and how are dividends usually paid

โžก๏ธ
See all cards
More answers
User Avatar

Wiki User

โˆ™ 2010-03-01 21:34:38

The wordings of term Limited Liability Company or LLC are very self explainatory. The owners of the company have limited liability for the action of the company formed by them. In most of the situation the owners' liability is limited to their invetment in the company. This protection to owners is lost if there is some fraud or misappropriation..

User Avatar

Add your answer:

Earn +20 pts
Q: What is a limited liability company?
Write your answer...
Submit
Related questions

What are the differences in public limited and private limited company?

What are the similarities between a public limited liability company and a private limited liability company.


What is Difference between limited liability company and limited liability company?

A company can be a limited or unlimited. Limited liability company is one which limits the liability of the members(shareholders) by (1) limited by shares or (2) limited by guarantee. Therefore Company limited by guarantee is a type of limited company which means the liability of the members' is limited by the guarantee given by them while becoming the member. The members have agreed to be liable to the company at the time of liquidation of the company upto an amount for which he is liable and does not have any other liability. Limited by shares means the member (shareholder) is liable for the value of the shares only. Members of the company with unlimited liability has unlimited liability for which they are liable even from their personal property if required.


What is the difference between limited liability and unlimited liability company?

A company can be a limited or unlimited. Limited liability company is one which limits the liability of the members(shareholders) by (1) limited by shares or (2) limited by guarantee. Therefore Company limited by guarantee is a type of limited company which means the liability of the members' is limited by the guarantee given by them while becoming the member. The members have agreed to be liable to the company at the time of liquidation of the company upto an amount for which he is liable and does not have any other liability. Limited by shares means the member (shareholder) is liable for the value of the shares only. Members of the company with unlimited liability has unlimited liability for which they are liable even from their personal property if required.


What are the advantages of being a limited liability company?

A limited liability company, or LLC, is its own entity and can possess assets, property, and liability. This allows you shield your personal assets from the assets of the limited liability company.


What is the authority of principals in private limited company?

A private, limited company would be a company with limited liability. This can be a company owned by two or more people. In this case, the liability of each owner is limited.


What is private liability?

Private liability is a type of company that offers limited liability. This limited liability can also include limited legal protection for its shareholders.


Is exxonMobil a limited liability corporation?

Not exactly, ExxonMobile is a Limited Liability Company (LLC). An LLC is a company not a corporation.


The significance of the word 'limited' in the name of a company?

it means that the company has limited liability. If the company goes bankrupt they loose only what they invest in the business.


What liability does a public limited company have?

it has unlimited liability


What is one example of a known limited liability company?

Any company with Limited, Ltd. or LLC attached to their name would be a limited liability company. Company's such as Natureworks LLC and The Markets LLC are examples.


What is limited Liability insurance?

Limited liability is a concept whereby a person's financial liability is limited to a fixed sum, most commonly the value of a person's investment in a company or partnership with limited liability. A shareholder in a limited liability company is not personally liable for any of the debts of the company, other than for the value of his investment in that company. The same is true for the members of a limited liability partnership and the limited partners in a limited partnership. By contrast, sole proprietors and partners in general partnerships are each liable for all the debts of the business (unlimited liability).


What is a WLL company and what does that stand for?

A "WLL" company is a type of limited-liability corporation, where WLL stands for "With Limited Liability." The rules for a WLL vary by country. In the US, the LLC ("Limited Liability Corporation") business type is similar.


What is the difference between a Ltd company and a none Ltd company?

Ltd is an abbreviation for Limited Liability; a limited company has limits to its liability; if the company goes bankrupt, or is sued, the liability does not extend to the shareholders in the company. A non-limited company; usually sole traders or partnerships, has unlimited liability - if a plumber floods your house, he is liable and you can sue him. Most non-limited companies have insurance to cover this kind of eventualility.


What does the word Limited stand for in Private Limited Company and Public Limited Company?

The word "limited" stands for "limited liability". This means that the liability of a shareholder in a company for the company's debts (for example, in an insolvency or liquidation scenario) is "limited" to any unpaid capital on their shares. In most cases, there will be no amount unpaid (ie. a fully paid share) and so no liability of a shareholder for the company's debts.


What is meant by LLC?

LLC: Limited Liability Company It is a type of company in which the owners bear only a limited liability.


What does llc stand for?

Limited Liability Company


What does LLP after a company name stand for?

Limited Liability Partnership


Can a company become a partner in a partnership firm?

Liability of a Pvt limited Company is limited - a mith. The fact is that liability of a share holder of a limited company is limited to the extent of value of the shares. In other words, the other assets of the shareholder can not attached for default of the company. So the liability of a limited company is limited to the assets of the company, not limited to the face value of the shares. On the other hand the partner of a partnership company has unlimited liability. i.e., the assets of the partner can be attached in case of default. Similarly, when a pvt limited company is a partner the liability of the company is unlimited and to the extent of assets of the company not to the assets of individual shareholders. So a limited company is a legal entity and can become a partner or proprietor of a firm.


In Texas can a limited liability company convert to a professional limited liability company?

No, you will have to file a new Articles of Organization and setup a new LLC.


What kind of company is Ltd?

A company where liability is limited to the members. There are three kinds of limited company: private company limited by guarantee, private company limited by shares, Public limited company


What's limited company formation?

Limited company formation is the process of forming a limited company. A limited company is a company (usually a new company) that is organized for owners having limited liability.


Why should you make your small business a limited liability company?

The move to a limited liability company completely depends on the type of small business they own. For most small businesses, turning into a limited liability business is worthwhile.


How does a parastatal differs from a public limited company?

LIMITED COMPANY is a company with limited stockholder liability: a company whose owners and managers enjoy limited liability and some tax benefits, but avoid some restrictions associated with S corporations A Public LIMITED COMPANY is a company with limited stockholder liability: a company in the United Kingdom whose shares can be bought and sold on the stock market and whose stockholders are subject to restricted liability for any debts or losses. One is open to the public and the other is not.


What is Limited Liability Company about?

Limited Liability Company, often referred as an LLC, is a legal description of a business. It provides the owners with limited personal liabilities should the company default. I work for such a company and seems to function very well.


How do you set up a limited liability company in Missouri?

A Missouri limited liability company is formed by filing Articles of Organization with the Missouri Secretary of State.