9501 W. 144th Place, Suite 205, Orland Park, IL 60462
Call Us708-448-8141
Sosin, Arnold & Schoenbeck Ltd.
9501 W. 144th Place, Suite 205, Orland Park, IL 60462
Call Us708-448-8141

Is an LLC the Right Entity for Your Illinois Business?

Posted on in Business Law

Illinois limited liability company LLC attorneyThe advent of the Limited Liability Company (LLC) has been a wonderful thing for many business owners. As a business entity, an LLC differs from others, such as a Corporation or General Partnership, in a variety of ways. Most importantly, an LLC protects the individuals that own it from being personally liable for debts assumed by the business. 

Such liability protection is an extension of core principles of capitalism, which seeks to encourage economic competition. Without risk, competition cannot thrive; it is what motivates businesses to produce and market the best products and services and thereby earn profits. This fundamental tenet of the American capitalistic economic system underlies the very existence of the LLC.  

It takes courage (and a whole lot of work, as any business owner knows) to start a small business and to give it everything you have in competing in an existing market or, with enough ingenuity, creating a new market altogether. Beyond guts and your own valuable time, a new business requires capital, whether in the form of a bank loan or funds from investors. Of course, your business must pay back these debts. This duty is where the LLC has very important ramifications.

Limited Liability Shields LLC Owners from Personal Liability for Business Debts

After you have utilized a bank loan or funds from an angel investor, venture capitalist, or private equity group to get your business up and running to the point where it is able to compete in the relevant market for goods and services on a scale consistent with profitability, it is the responsibility of your business to pay back these debts. If you have incorporated as an LLC, it is the responsibility of your business, and only your business, to repay loans and investments. 

Business liability is separate from personal liability. In other words, if your business is unable to pay back its debts as a result of not being able to earn enough profits to remain in the market, the LLC protects you from being personally liable for the debts of the business.  

Incorporating Your Business in Illinois

An LLC is a business entity that gives many aspiring business owners the confidence they need to take the capital risks inherent in competing in the American economy. The attorneys at Sosin, Arnold & Schoenbeck, Ltd. can help you understand your options when choosing a business entity and assist you in completing the process of business formation. Contact an experienced Cook County business law attorney at 708-448-8141.

Sources:

http://www.ilga.gov/legislation/ilcs/ilcs3.asp?ActID=2290&ChapterID=65

Illinois State Bar Association Justinian Society of Lawyers Illinois Bar Foundation Southwest Bar Association
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