Whereas a Corporation has shareholders, a Limited Liability Company has ‘members’ and a ‘single-member’ LLC has one owner. The IRS disregards a single-member LLC and looks to the single-member as the responsible (tax-paying) party just as most courts look to the single-member as the (liable) party. Therefore a single-member LLC does not file a separate tax return, the single-owner (if an individual) is responsible for filing information on their personal 1040 tax return in the form of a K-1. The great states of Nevada, Wyoming and Delaware are currently the only states in the union wherein their state statutes specifically state in-writing that the charging protection applies to single-member Limited Liability Companies as the sole and exclusive remedy for judgement creditors. Unless a single-member LLC is formed in one of these three states, or the sole member of the LLC is another entity, single-member LLC’s offer no asset protection or tax benefits.
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