The Limited Liability Company (“LLC”) has become the dominant form for newly-created small businesses in most states in America. In fact, 76% of newly formed for profit business each year in Colorado are choosing the LLC. It is clear that LLC is the entity of choice for Colorado’s entrepreneurs.
The LLC has become so popular due to the fact that it gives business owners several advantages of the various business forms in one package. It is a hybrid which combines the flexibility and taxation benefits of a partnership with the limited liability protection of a corporation. Much like a corporation, an LLC is a legal entity which exists apart from its individual owners.
Financially, this effectively limits an individual member’s financial liability to no more than their investment in the LLC. This limit on financial liability for the business owner is very attractive considering that his or her personal assets are not at risk to satisfy the debts of the LLC (assuming business formalities are correctly followed). Only the LLC itself is liable for its financial obligations.
From a risk standpoint, an LLC offers similar protection from tort law suits to the individual owners or members as a corporation does. This simply means that the members of an LLC are not held liable in legal suits for the wrongs that his fellow member(s) commit against third parties. Additionally, an LLC limits the liability of an individual from lawsuits brought by fellow members, directors or managers of the LLC.
The organizational flexibility, limited liability, and pass-through taxation of the LLC have clearly made it the entity of choice for small and medium sized businesses in Colorado.
To form your Colorado LLC today with the assistance of a licensed Colorado Attorney, complete the easy steps to formation at www.RockyMountainStartup.com