Tuesday, September 1, 2009
Limited Liability Companies (LLC) are a "hybrid" between traditional corporations and partnerships. The are thought to combine the best and most flexible attributes of each. The hallmark of corporate business form is its ability to shield the shareholders from liabilities of the business venture (limiting their liability to their investment in the stock). Partnerships are generally thought to be more flexible and less administratively complex.
The LLC gives the owners the liability limitations afforded by the corporation and the so-called simplicity and ease of operation of a partnership form of business.
The LLC is not a historically traditional business form (sole proprietor, partnership and corporations date back 100's of years). The Michigan LLC Statute was first enacted in 1993, making the LLC a "new" entity in Michigan.
Business persons should seek experienced and knowledgeable counsel and tax advice before setting their business entity up. See, Michigan Single Member Limited Liability Companies.