What Is an LLC?

And How Is It Different Than a Corporation?

I know a thing or two about the complexities of launching a new business. As the owner of several businesses in the Los Angeles entertainment industry, I know from experience that you’ll have a quadrillion questions.

And one of the initial questions you’ll certainly need to ask is, “What is an LLC, and how does it compare to a corp?”  Then naturally, your next question will be, “So…which one should I set up?”

What is an LLC?

An LLC, or limited liability company, is a legal business entity you form to protect your personal assets from liability. It will also establish how your business income is treated come tax time.

What is a corporation?

The other most common option is a corporation (aka a corp or Inc.). Corporations are another business entity that also provide liability protection. But, they are set up a little differently from an LLC.

What are the differences between an LLC and a Corp?

These two business entity options have some similarities and, of course, differences. Choosing between the two will depend on your business type and its needs, as well as your own liability and tax planning goals.

An LLC is typically either owned by one person or a small group of co-founders. But technically, an LLC doesn’t have “owners”; it has “members.”


Sounds a but counterintuitive, but as I just mentioned, one of the biggest factors of your credit score is the percentage of used credit vs available credit. The lower the percentage the better.

Liability Protection


Generally speaking, LLCs indeed have less paperwork, particularly because it doesn’t have to hold “annual meetings” of the directors and take meeting minutes. It also does not have to issue “stock certificates” to its members.


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