What Is A WA LLC
A Washington limited liability company, commonly named an LLC, is a very popular business structure that combines the benefits of different business types into one. LLCs have the tax advantages of a sole proprietorship or general partnership while also providing the personal liability protection of a corporation.
Benefits of an LLC
An LLC is a separate legal entity, meaning that it and the owners (who are known as “members” in an LLC) are not the same in the eyes of the law. If the LLC is sued or goes into debt, the members’ personal assets (savings, home, cars, etc.) are usually not at risk. As with a corporation, forming an LLC does require you to pay a fee and file paperwork with the state, but the management of an LLC allows for much more flexibility than a corporation with less paperwork and fewer reporting requirements. LLC members can draft an LLC operating agreement to customize the rules for managing the company. LLCs also have tax advantages. By default, LLCs are taxed as a passthru entity like sole proprietorships or a general partnership. This usually means that profits are not taxed at the business level before being distributed to the members, who only pay income tax from their share of the LLC’s profits on their personal tax returns.
