What are the advantages of operating as an LLC?

The LLC is treated as a partnership for federal tax reporting. Taxable income and losses pass through to its members (owners) in the same manner, as is the case with partnerships and similar to S corporations.

The law allows the inclusion of liabilities of the LLC in order to increase basis for tax purposes (as in the case of a partnership).

The liability of all members is limited to their investments in the LLC (unless they personally guarantee other debt incurred by the LLC).

Payment to a retiring member may be structured so as to allow part of the payment to be deducted as an expense to the LLC.

The Delaware Limited Company Liability Act does not require that a limited liability company agreement be in English.

If an LLC has no members in the U.S., and derives no income from sources within the U.S., then, according to current law, as of December 1997, no U.S. federal income taxes will be due by the members who are nonresident aliens of the U.S.

An LLC can be formed by one member/manager. Delaware does not require the member/manager be listed in the document. The new IRS ruling allows the LLC to be perpetual.