What is a limited liability company (LLC)?
A Limited Liability Company, or LLC, is a type of legal business entity that is recognized in South Carolina and other states. In general, an LLC offers its members limited liability protection, meaning members are not personally responsible for the debts or liabilities of the company. This means that LLC members’ assets, such as their homes and personal bank accounts, are generally protected from legal action taken against the LLC. In South Carolina, LLCs are formed by filing with the Secretary of State’s office. To file, a document called the Articles of Organization must be completed and submitted along with a filing fee. In addition to filing with the state, LLCs must also register with the state tax department and comply with applicable federal and state laws. An LLC is managed by its members, also known as owners, or by managers appointed by the members. Depending on how it is organized, an LLC can be managed like a corporation or like a partnership. An LLC can also elect to be treated as an S corporation for tax purposes. In South Carolina, the formation and operation of LLCs is regulated by the South Carolina Limited Liability Company Act. This act addresses such matters as the formation and governance of LLCs, the sharing of profits and losses, and the dissolution of LLCs. While an LLC provides liability protection, its members may still be held liable for their own negligence or wrongful acts.
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