The ownership of Dogs of Denver, a small company that designs and manufactures coats, sweaters, jackets, and rainwear for dogs, wants to organize as an LLC. All the owners are under forty and two are expecting children by the end of the year. This is good strategy because each member can choose to commit to limited or unlimited liability.

Question

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All members of an LLC have limited liability. There is no choice in that matter. The purpose of organizing as an LLC is to eliminate the risk of losing personal assets in an unprofitable venture. In terms of taxes, a limited liability company offers the best of both worlds, allowing the owners to choose to be taxed as a partnership or a corporation depending on which tax rates would benefit them the most.

The Ownership of Dogs of Denver, a Small Company That