A Limited Liability Company (LLC) is a cross between a corporation and a partnership. It is owned by one or more interest holders, or members, who are team members with management rights. Members can also assign certain managers to run the company who are not members and are only responsible for the amount of money they contribute. LLC’s are taxed just like partnerships are, so earnings are given to owners and they are then taxed at their personal taxed rates.
The biggest benefit of operating a Limited Liability Company is the protection of its interest holders from expenses that arise from bankruptcy or other debts and liabilities.
LLC have become the most common type of entity in the US. How the LLC is governed can be stated in the company’s operating agreement or bylaws, giving the company flexibility. However there are typically default rules for how an LLC is governed provided by the state.