What is the difference between a corporation and a LLC?

The difference between a corporation and a Limited Liability Company (LLC) is primarily the way they are taxed and the liability of their owners. In South Carolina, a corporation is an entity with shareholders that is set up as a separate legal entity from its owners. This means that the owner’s personal assets are not liable if the corporation runs into financial trouble. Corporations are subject to corporate income taxes, which can be more expensive than taxes incurred by an LLC. An LLC is also a separate legal entity from its owners, but it is not taxed as a corporation. In South Carolina, an LLC passes its profits and losses through to the individual owners, who then pay taxes on the profits at their individual tax rate. An LLC also offers its owners better protection from liability than a corporation does. LLC owners are only liable for the losses and debts of the company up to the amount that they have invested. In comparison, corporation shareholders are personally liable for debts and losses, regardless of the amount they have invested. Ultimately, choosing between a corporation and LLC will depend on the particular details of a business, such as its size and structure. Business owners should consult a lawyer or tax specialist to determine which structure best suits the needs of their business.

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What is the difference between a corporation and a LLC?

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