What is the difference between a corporation and a limited liability company (LLC)?
The primary difference between a corporation and a limited liability company (LLC) is the type of legal structure each business is set up as. In Kansas, a corporation is considered to be a type of business entity that is separate from its owners, called shareholders. This means that the owners and shareholders of the corporation have limited liability for debts and legal liabilities incurred by the company. A corporation has the ability to raise capital by issuing stock, and can also sue and be sued in its own name. On the other hand, an LLC is a type of business organization that combines elements of both a corporation and a partnership. In Kansas, LLCs have the legal structure of a corporation, meaning that its owners, called members, have limited liability for any debts or liabilities of the company. However, unlike a corporation, an LLC does not issue stock, and its members have more flexibility in how they manage the business. LLCs also do not have to follow the same formalities and procedures as a corporation in order to remain in good standing. Overall, the main difference between a corporation and an LLC is the type of legal structure each business is set up as. While a corporation has the structure of a separate legal entity with shareholders who are not personally liable for the liabilities of the company, an LLC combines elements of a corporation with a partnership and provides its members more flexibility in managing the business.
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