– the members of the LLC are not liable for the debts, liabilities or taxes of the LLC.
Tax – single-member LLC passes its taxable income or loss to its member. Single member LLC does not file any tax forms with IRS tax office. Multi-member LLC splits up its taxable income and according to the share of membership percentage of each member and then it passes the taxable income or loss to the member. The members of the LLC then file their share of taxable income or loss on their tax return and pay income tax if due. Multi-member LLC files each year a tax form showing its financial results, taxable income or loss with the IRS tax office. But the LLC does not pay income taxes on its taxable income or loss to the IRS.
Directors – LLC is managed by managers.
Annual Return – LLC have to file each year or each twelve months from its formation anniversary a form called annual return showing its company name and registered address. In some states the LLCs must report on this annual return also its managers.
C-Corp, S-Corp, Ltd, Inc
Limited Liability – the shareholders of the Corp are not liable for the debts, liabilities or taxes of the LLC.
Tax – Corp files each year a tax form showing its financial results, taxable income or loss with the IRS tax office and pays income tax from its taxable income. Any remaining after tax income can be paid out to shareholders. Such payment of after tax income to shareholders is called dividends. Shareholders then report the dividends in their tax return and if dividend tax is applicable pay the dividend tax.
Directors – the Corp is managed by directors.
Annual return – Corp has to file each year or each twelve months from its formation anniversary a form called annual return showing its directors, companyname and registered address
Limited Liability Partnership provides the same tax and liability treatment for its members as LLC.
– partners are classified into two groups, unlimited partners and limited partners. Unlimited partners are fully liable for the debts of the company. Limited partners are not liable for the debts or tax payable of the LP.
Tax – income and expenses are segregated into two parts assignable to limited and unlimited partners. Income assigned to unlimited partners is passed into their tax returns. Income assigned to limited partners is tax at the level of the LP and if the residue of the income after tax is distributed, then it might be subject to second level of taxation under dividend tax.
– partners of the GP are fully liable for the debts of the company. The upside is that formation of GP is the easiest and does not require any filing for formation.
Tax – GP is transparent for the purpose of tax and any income and expenses are passed to partners who must include them into their tax returns.