Video: Limited Liability Company

In this lesson, Nick Palazzolo, CPA, delves into the workings of Limited Liability Companies (LLCs), addressing why they might be the preferred entity for certain businesses, and how this relates to the exam scenarios candidates will encounter. He breaks down the LLC structure, highlighting the fusion of corporation benefits with partnership perks – including limited liability and pass-through taxation. Throughout the lesson, Nick covers critical aspects such as single-member LLCs as disregarded entities for tax purposes, multi-member LLCs taxation, and the potential scenarios under which an LLC might choose to be taxed as a corporation. He also explains the operational elements like articles of organization, member management, and debt guarantees. Transferring ownership in an LLC, member voting rights, and avenues for termination of the LLC are other topics discussed, alongside how operating agreements work. Nick conveys the key features and considerations of LLCs with clarity, ensuring a comprehensive grasp of the topic.