Limited liability company

Also found in: Dictionary, Thesaurus, Legal, Acronyms, Encyclopedia, Wikipedia.
Related to Limited liability company: Private limited company, Limited liability partnership

Limited liability company (LLC)

A company that has characteristics of both a corporation and partnership. Like a corporation, it offers owners limited liability and like a partnership, taxation is at individual owner level rather than at corporate level.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Limited Liability Company

In the United States, a company with limited liability amongst its owners, that is, one in which a partner is not liable for more than his/her/its investment in case of insolvency. In other words, a co-owner of a limited company would lose the value of his/her investment if the company declares bankruptcy, but would not be held liable for other outstanding debts. A limited liability company is one of the most common corporate structures in the United States. It is designated by the letters "LLC" after its name.

A limited liability company is taxed as if it were a partnership, but has the ability to raise capital by acquiring new partners as if it were a corporation. However, because a limited liability company is not publicly-traded, it may have more difficulty raising capital than corporations. A limited liability company is designed to give at least some employees a share in the company's equity, while protecting them from potential losses. See also: Limited company.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

Limited liability company.

Organizing a business enterprise as a limited liability company (LLC) under the laws of the state where it operates protects its owners or shareholders from personal responsibility for company debts that exceed the amount those owners or shareholders have invested.

In addition, an LLC's taxable income is divided proportionally among the owners, who pay tax on their share of the income at their individual rates. The LLC itself owes no income tax.

The limited liability protection is similar to what limited partners in a partnership or investors in a traditional, or C, corporation enjoy.

The tax treatment is similar to that of a partnership or S corporation, another form of organization that's available for businesses with fewer than 75 employees. However, only some states allow businesses to use LLC incorporation.

Dictionary of Financial Terms. Copyright © 2008 Lightbulb Press, Inc. All Rights Reserved.

limited liability company

A cross between a corporation and a partnership, the limited liability company must be created by documents filed in the same place as corporations.This type of organization enjoys much of the informality of a partnership, the tax benefits of a partnership with all income taxed at the shareholder level but not at the company level (see double taxation), and the limited liability granted to corporate shareholders, who cannot be held personally liable for a corporate debt or transgressions. Be aware, however, that members of a limited liability company may well be safe from contractual claims against the company, but most claims for negligence or wrongdoing will include some theory of personal liability against the members also.

Example: A claim against a limited liability company may be for its negligence in allowing mud and water to remain on the floor, leading to a customer slipping and falling and sustaining back injuries. The plaintiff in such a case may claim the individual members were also personal- ly liable for their failure to develop policies and procedures to keep the floors clean or because they were also the employees and had personal responsibility to mop the floors.

The Complete Real Estate Encyclopedia by Denise L. Evans, JD & O. William Evans, JD. Copyright © 2007 by The McGraw-Hill Companies, Inc.
References in periodicals archive ?
The Commercial Companies Law states that the profits of a Limited Liability Company should be distributed in accordance with the percentage of shares held by the partners unless agreed otherwise.
$2.4 million: Poul Olesen and Svend Toftemark - founders of Emerald Excavating - sold the Scandia Village Mobile Home Park to a limited liability company, whose members include Newport Beach, Calif., resident Peter DeBaun, who is associated with several mobile and manufactured home properties.
* The constituent meeting is convened which must approve the founder's report of the limited liability company and elect the members of bodies of the company elected by the general meeting of shareholders.
of the limited liability company and the unique single member limited
Even then, state statutes other than Texas required a limited liability company to have two or more members so that it could be classified as a partnership rather than a corporation.
The most direct method of converting is simply to liquidate the corporation by transferring the corporate assets to the corporation's shareholders and then have the shareholders contribute the assets to the limited liability company. This method could, however, result in substantial tax consequences.
TAHP is designated a limited liability company, which means that, if it goes belly up, the IPO members would have limited personal liability for debts.
Florida requires a name ending of "limited company" while Wyoming requires "limited liability company." To be safe, the LLC status should be identified in the name.
Utah became the fifth state in the nation to authorize the creation of a new form of business entity, a "limited liability company," effective July 1, 1991.
John Brennan from Marcus & Millichap's Brooklyn office, had the exclusive listing to market the property on behalf of the seller, a limited liability company. The buyer, a private investor, was also secured and represented by Brennan.
exchange-traded bonds of the limited liability company X 5 FINANCE with identification number of the issue 4B02-05-36241-R;

Full browser ?