What is a non -profit LLC?
non -profit LLC is a type of unregistered association in the United States. LLC means a limited liability company, a form of an organization that protects its members from unlimited financial responsibility. The creation of LLC can allow the non -profit organization to own property and enjoy many other legal benefits. Unlike corporation, however, income for limited liability company is taxed as a direct income of its owners or investors. The non -profit aspect of the non -profit LLC allows it to be tax benefits in the US.
Non -profit organizations use revenue to maintain or expand operations and do not distribute excess profits to investors, employees or parties. However, many non -profit organizations are structured as profitable companies, because these models are often the most effective. Non-profit organizations can be legally organized by several ways-Korporations, Trusts and Cooperatives can be non-profit. If certain criteria are met, non -profit organizations may be exemptSince paying federal taxes in the US. Thanks to this advantage, creating a non -profit LLC for many organizations is an attractive option.
liability with limited liability means some protection under the law from the financial burden of the company. It can reduce the personal risk of embarking on new markets and economic niches. If the business company fails, the limited liability may protect persons involved from personal bankruptcy. On the other hand, the owners of unlimited companies are personally responsible for all debts incurred. The LLC non -profit model is often selected due to legal protection offered limited liability.
Additional requirements generally apply to limited liability organization, such as public financial statements at regular intervals and filing a separate tax return. It is also often difficult to induce creditors to finance LLC activities without a loan personally guaranteed. Differences between LLC and spoliMinging is often ignored in international jurisdictions because foreign countries often consider LLC to be a corporation for tax purposes. In fact, not all US states recognize the non-profit status of LLC-is the relatively rare form of a legal person who has recently established.
Non -profit LLC shares some features of partnerships and corporations. Just as partnership does not solve stock stock shares. This can lead to investment strategies more in line with small partnerships with specific investors. However, the aspect of limited responsibility is the most common in corporations. As with corporations, the "corporate veil" does not apply to legal protection if the members of the non -profit LLC commit fraud or cause damage to a third party.