Introduction

Question 1

What is an LLC?

Answer 1

LLC = a hybrid business org that:

1. is taxed like a partnership (except for single member LLC);
2. offer its owners (called members) the LIMITED LIABILITY of shareholders of a corporation; AND
3. can be run like EITHER a corporation or a partnership

Question 2

Is there a limit to the number of owners (members) of an LLC?

Answer 2

There is no limit on number of owners (members)

unlike subchapter S corp

Question 3

In an LLC, does anyone have to accept full personal liability for org’s debts?

Answer 3

No

unlike limited partnership

Question 4

What controls most aspects of LLC’s business and management?

Answer 4

• LLC’s are governed by statute

- LLC members may adopt “OPERATING AGREEMENT” to control most aspects of LLC’s business and management

Question 5

What is the model law that provides default set of rules for LLC’s?

Answer 5

RULLCA of 2006

Revised Uniform Limited Liability Company Act of 2006