A limited liability company (LLC) protects personal assets if the business cannot pay its debts. The LLC’s creditors can only take the money invested in the business. An LLC limits personal liability for business debts and claims. You can transfer cash, real estate, securities or personal property into an LLC. Then you can pass those assets to heirs. Using an LLC for real estate investments facilitates ownership transfer.
Advantages of an LLC
- Protects personal assets from business debts and claims.
- Limits personal liability for business debts.
- Allows for the transfer of various assets into the LLC.
- Facilitates the transfer of LLC assets to heirs.
- Simplifies real estate ownership transfer.
Disadvantages of an LLC
While the text provided does not explicitly state the disadvantages of an LLC, it is important to note that creating and maintaining an LLC can have disadvantages such as:
- Cost of formation and ongoing maintenance.
- Potential complexity in tax filing.
- Requirements for compliance with state regulations.