LLC (Limited Liability Company)
Definition: A business entity that offers liability protection with pass-through taxation by default.
A limited liability company protects its owners, called members, from the company's debts while being taxed by default as a sole proprietorship or partnership. The IRS does not have an LLC tax category of its own, so an LLC may also elect to be taxed as a corporation.
What the state record shows about an LLC
Every state lists the LLC name, filing date, status and registered agent. Whether members or managers appear depends on the state. Florida, Alaska and North Carolina list them; Delaware, Wyoming and New Mexico generally do not. The LLC lookup guide covers how to find owners when the record is silent.
| Feature | Typical rule |
|---|---|
| Formation document | Articles of Organization |
| Internal rules | Operating agreement, usually not filed |
| Owners called | Members |
| Managed by | Members or appointed managers |
The first LLC law was passed by Wyoming in 1977, and every state had one by 1996.
Related: business entity types, Wyoming, where the LLC began.
LLC (Limited Liability Company) questions
Is an LLC a corporation?
No. An LLC is a separate entity type with members instead of shareholders, though it can elect to be taxed as a corporation.
Does an LLC need an EIN?
An LLC with employees or more than one member needs one. A single-member LLC with no employees can often use its owner's taxpayer number for income tax.
Sources
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