What are the differences between a corporation and an LLC?

When it comes to asset protection law in New York, there are two important entities to consider: corporations and limited liability companies, or LLCs. Both entities provide legal protection from personal liability for business debts and obligations, but there are a few key differences between the two. Corporations are more established business entities, often referred to as “C” or “S” corporations. They’re owned by shareholders and managed by a board of directors. Corporations can issue stock, leverage debt, and make decisions that carry legal weight. They’re highly regulated and require corporate filings, meetings, and more, and can also issue stock options to their employees. LLCs, on the other hand, are newer and less formal business entities. They’re owned by members - who can be individuals, corporations, trusts, etc. - and managed by either the members or appointed managers. LLCs don’t pay corporate taxes, but instead pass the profits and losses of the business through to the members. They’re simpler to manage than corporations, and generally don’t require meetings or corporate filings. Overall, when it comes to asset protection law in New York, corporations and LLCs differ in structure, taxes, the amount of regulation, and other important aspects. Depending on the needs of the business, one might be more suitable than the other.

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