What are the differences between a corporation and an LLC?

In Ohio, a corporation and an LLC are two common types of business entities used to protect assets. While both of these entities limit the personal liability of the owners, there are distinct differences between the two. A corporation is a separate legal entity from its owners, which are referred to as shareholders. This means that the corporation, not the shareholders, is liable for any debts or legal judgments. In addition, a corporation is taxed separately from its shareholders. This means that it must file its own income tax return and pay taxes on profits. An LLC, on the other hand, is a hybrid business entity. It combines the tax advantages of a corporation with the flexibility of a partnership. Unlike a corporation, an LLC does not issue stock. Instead, the business is owned by members, who are not taxed separately from the business. Another advantage of an LLC is that the members are not personally liable for the debts of the business. In the end, the choice between a corporation and an LLC depends on the individual’s or company’s needs. Business owners should consult with a lawyer or tax expert to determine which entity is best for their specific situation.

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