Is a type of an enterprise, which provides its owners with limited liability. Capital of LLC is formed with members’ contributions. Each members owns amount of members units (shares) according to his/her contribution.

• Liability. Owners of a LLC have the liability protection of a corporation. A LLC exists as a separate entity much like a corporation. Members cannot be held personally liable for debts unless they have signed a personal guarantee.
• Income taxes. Income of a Limited Liability Company is a subject to pass through taxation – company doesn’t pay income taxes. Income taxes are paid by members as their personal taxes.
• Longevity. Life of the company is determined by availability of a member, who owns 50% of the LLC or more. If this member will decide to leave the company, LLC will be dissolved. If LLC loses member, who have less than 50% won’t influence company’ operation.
• Control. There are two types of LLCs, which differ by the type of control: Member-Managed LLC and Manager-Managed LLC. According to the name of each type, the first LLC is managed by its members or their fiduciaries; the second is managed by a hired manager. Second type is used when member what to save investor status and do not want to manager the business (Moye, 2004 p.126)
• Profit retention. Profit of a LLC is divided among members according to their stake (number of member units).
• Location. Generally, a LLC registered in one state can operate in the other ones as well, though some additional paperwork may need to be filed. While operating in different states, LLC might be influenced by local taxes, like the franchise tax. Moreover, some states do not allow some businesses to be formed like LCCs.
• Compliance. Limited liability companies can select varying forms of distribution of profits. Unlike a common partnership where the split is 50-50, LLC have much more flexibility. The LLC business structure requires no corporate minutes or resolutions and is easier to operate. (Zahorsky, D. 2009. About.com). LLC is dissolved when a member dies or undergoes bankruptcy. Running a sole-proprietorship or partnership will have less paperwork and complexity. A LLC may federally be classified as a sole-proprietorship, partnership, or corporation for tax purposes. Classification can be selected or a default may apply.