A Limited Liability Company (LLC) is an organization form in some states that may be treated as a partnership for federal tax purposes while offering limited liability protection to its owners at the state level. This entity may be subject to state franchise tax as a corporation. Two common forms of these entities are Limited Liability Companies (LLCs) and Limited Liability Partnerships (LLPs), which protect individual partners from the liabilities of other partners.
A pass-through entity is a non-taxable business structure where income or expenses are passed directly to the owners, retaining their original character.
