What are the pros and cons of opening an LLC?

Pro#1: You have the option of pass-through taxable income, which enables you to avoid a corporate tax return. With the pass-through taxable income, the owner pays the taxes for their business’ profits on his or her individual tax return.
Pro#2: There is no residency requirement so that business owners are not required to be U.S. citizens or permanent U.S. residents.
Pro#3: The business owners bears the majority of the responsibility for the company; therefore, there is limited liability for members, managing members, and employees.

Con#1: You cannot issue stock shares to attract investors.
Con#2: Venture capitalists and investors do not like to invest in LLCs, because they are flow-through entities.
Con#3: There are different laws for LLCs, depending on which state it was filed in, so registration and taxes can differ from state to state. Also, your earnings can be subject to self-employment task.

Do you have any other concerns or questions about opening an LLC? Contact us today at 800-513-2272 and we will be happy to answer all of your questions.