This relatively new business entity is a hybrid between the partnership and the corporation. It has all the flexibility of a partnership (it is created by a contract among all the parties), yet can enjoy the limited liability typical of a corporation.
Many states now recognize the LLC, and the IRS has defined tax regulations pertaining to it. The LLC also avoids the statutory restrictions of the Subchapter S corporation. Businesses which might best consider the LLC form are venture capital/investment firms, family businesses, entrepreneurial start-ups, and professional corporations. This new reports presents the LLC clearly and authoritatively.