What is the difference between a limited liability company and a sole proprietorship?

The main difference between a limited liability company (LLC) and a sole proprietorship in South Carolina is the degree of control and protection that each business formation offers. A sole proprietorship is an unincorporated business that is owned and operated by one person. The owner of a sole proprietorship is personally responsible for the debts and liabilities of the business. This means that any legal issues or debts incurred by the business will fall solely on the owner, and all assets of the business, including the owner’s personal assets, can be used to settle these debts. On the other hand, a limited liability company is a business entity that shields the owners from any obligations or debts incurred by the business. In other words, the owners are only liable for the amount of money they have invested into the business, which means all other assets are protected. Additionally, LLCs have the advantage of being able to pass through their profits and losses to the owners, thereby avoiding double taxation. In short, a sole proprietorship offers less control and less protection than an LLC, as the owner is personally responsible for all debts and liabilities incurred by the business. An LLC provides more control and more protection to the owners, as it shields them from any obligations or debts incurred by the business.

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What is the difference between a limited liability company and a sole proprietorship?

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