Business Entities

Business Entities

Business Entities

Limited Liability Company and corporation are both types of business entities. Corporations are the most appropriate entities to protect your personal assets from business liability, covering the shareholders from any personal liability of business transactions. The Limited Liability Company offers outstanding protection from business obligations just the same as corporation. This two entities would be the best to use to protect the business from liabilities because for one, Limited Liability Company have operational flexibility and income benefits. Also corporation will also be suitable since Stockholders’ are protected from liability and those stockholders who are also employees may be able to take advantage of some tax-free benefits, such as health insurance.

Limited Liability Company is a combination between a partnership and a corporation while a corporation is a legal entity, operating under state law, whose objectives, requirement and name are restricted by its charter. The Limited Liability Company has few formalities with equal protection from business liability unlike corporation which has many formalities. Therefore, Limited Liability Company will be the most suitable because it extends things further by addition of asset protection that no other entity offers.

In conclusion, there are several similarities and differences between a Limited Liability Company and a corporation. The two business entities are important in the protection of businesses against liabilities. Generally both have benefits that the business owner would enjoy. Hence Limited Liability Company and corporation will be the best to protect the business from liabilities because there are no many legal formalities involved. Also the business owner will enjoy other benefits such as health insurance and asset protection.

References

Chiappinelli, E. A. (2014). Cases and Materials on Business Entities Aspen Casebook. Wolters Kluwer Law and Business.

Harris, L. (2015). Mastering Corporations and Other Business Entities. Carolina Academic Press.