Benefits Of An LLC Florida

Deciding on the appropriate business structure is an important step in starting your business as it can decide the future of the entire endeavor. 

In your search, you’ve probably come across the term limited liability company (LLC). As widespread as it is, you might be wondering if it’s the right choice for you and what are its advantages.

Today, we’re going to look at just that so that by the end of this article, you’ll learn all about the benefits of an LLC Florida and some disadvantages that may help you decide if this structure is right for you.

Let’s start with the basics, shall we?

What Is An Llc?

A limited liability company is a popular business structure in the United States. It’s an organization with a structure that combines the features of partnerships with those of corporations. 

In other words, an LLC provides the owners of the company with limited liability when the business fails, but it also allows them the opportunity to tax their profits as their personal income - similar to a partnership.

This ultimately helps you protect your personal assets and gain advantageous tax perks. 

Advantages Of Starting An Llc

If you want to shield yourself from failure and save a lot of money on taxes, then an LLC is the right choice for you. Benefits of an LLC Florida include:

1. Limited liability protection

As we already said, you’re not personally responsible in case the business fails, meaning your personal assets such as your home or bank account will be protected.

This is a great choice for small businesses. Because sole proprietorships or partnerships don’t offer this protection and corporations usually offer unfavorable taxes to small businesses, an LLC offers middle ground. 

2. Pass-through taxation

Just like partnerships and sole proprietorships, LLCs are subject to this type of taxation in which the net income of the business passes through the individual tax return of the owner. Simply put, the net income will be subject to income taxes which are based on the tax bracket of the owner.

When you consider the benefits of an LLC Florida, this is a big one because of one thing - double taxation.

If you want to start a corporation in the Sunshine State, your profits would be subject to double taxation. This means that every penny you earn would be taxed first and only then distributed to owners, after which all of the profits will get taxed again on the individual tax returns of the owners.

3. Simplicity

If you don’t want to go through a whole lot of stress, then you should start an LLC as one of the main benefits of an LLC Florida is its simplicity. 

It really doesn’t take much to maintain it, and unlike corporate entities, you won’t be required to assign formal roles nor have to worry about annual meetings or bylaws.

4. More credibility than other simple business structures

Although sole proprietorships and partnerships are legitimate business structures, starting an LLC carries more weight in the eyes of clients. That way, your business will automatically have more credibility if you choose to go with an LLC as your business structure.

5. Protection of your name

One of the biggest drawbacks of sole proprietorships and partnerships is the fact that you have to use your own name as the business name. Otherwise, your only option is to register a DBA (doing business as - most commonly a fictitious name) as a name to use anything else.

With an LLC, you can choose a unique name that will be registered with the state upon the formation of the company. Other businesses in the state of Florida can’t steal the name during the time your business is active.

6. Flexibility in ownership

The last of the benefits of an LLC Florida is ownership flexibility. At the moment, there aren’t many restrictions on the way you structure your LLC.

For instance, your company can be either single-member or multi-member. You can also decide if the company will be member-managed or have a manager appointed.

The sky's the limit with LLCs.

Disadvantages Of Starting An Llc

Even though there are many benefits of an LLC Florida, there are also some drawbacks you need to consider before starting one. 

While LLCs are cheaper to establish and maintain than corporations, they are generally more costly than sole proprietorships and partnerships. Many fees such as filing, annual, and business license fees may add up quite quickly. 

Depending on the operating agreement outlined by the members, ownership may be hard to transfer. This is a stark contrast to corporations in which ownership transfers are flexible. 

Lastly, since LLCs are pretty new, there is limited case law governing them. Thus, there is minimal case law protection offered to these business entities.

Do You Need A Lawyer To Start An Llc?

Now that you have a rundown of the benefits of an LLC Florida and its drawbacks, you can make a call on whether an LLC is the right choice for your business.

To make an informed decision, you should hire a lawyer because there is no shortage of issues that can affect which option is actually beneficial for your business. You may need help with ownership, taxation, as well as potential partnership issues you may run into later down the road.

More importantly, without an experienced legal professional guiding you along the way, you may not be aware of all the legal requirements for an LLC to be valid in your state. Any mistakes in this regard can cause significant delays when starting your business and might cause expensive liability issues in the future.

For instance, some of the legal requirements include:

• Finding a legally valid name for your company
• Creating and filing legal documentation that meets state standards
• Filing fees
• Publication requirements
• Drafting a legally valid LLC Operating Agreement

Get In Touch With The Law Offices Of Mary E. King If You Want To Start An Llc 

Depending on the circumstances, an LLC might be the best formal business structure available. However, to make the right choice and the entire process a lot smoother, you will likely need expert legal advice. 

If you want to leave no stone unturned avoid liability issues in the future, get in touch with the Law Offices of Mary E. King. Our attorneys have decades of experience providing legal advice and tax services to many businesses around Florida, plus we’re experts at federal tax law and commercial law. 

Call 941-906-7585 or fill out our online contact form to schedule an appointment and get that LLC up and running. 

Note: 

The information in this blog post is for reference only and not legal advice. As such, you should not make legal decisions based on the information in this blog post. Moreover, there is no lawyer-client relationship resulting from this blog post, nor should any such relationship be implied. If you need legal counsel, please consult a lawyer licensed to practice in your jurisdiction.