Limited Liability Companies: Why is It the Most Popular Type of Business Entity

Limited Liability Companies
Student Name
Department, University
Course Code: Course Name
Professor’s Name
Due Date
Limited Liability Companies
Why is LLC the Most Popular Type of Business Entity?
The LLC constitutes the most prominent business organization form because its shareholders enjoy limited liability. In insolvency or bankruptcy scenarios, the business owners and their associates will not be liable for debts or legal suits. An individual is likely to be a shareholder in a LLC because their personal assets cannot be liquidated to pay the company’s financial obligations. In addition, the LLC is conceptualized as a pass-through business organization, implying that the losses and profits go to the shareholders directly (Taulli, 2016). The LLC allows for better estate planning via tax benefits, especially in perpetual trust.
Compare the LLC, C corporation, and S corporation.
In LLC, limited shareholder liability implies that only the company’s assets can be liquidated and considered to pay the existing debts. On the other hand, in a C corporation, limited liability is shared among all stakeholders, incl...