An Alabama company structure called a Professional Limited Liability Company (PLLC) is primarily intended for licensed professionals including attorneys, accountants, architects, and doctors. It combines the limited liability protection of an LLC with a sole proprietorship or partnership’s professional service capabilities. In other words, it enables its members to pursue their profession without the requirement for a general partner while providing personal asset protection to them.
A PLLC provides its members with liability protection, which is a major benefit. This means that the members’ private property is shielded against confiscation in the event of a lawsuit or debt. Only the PLLC’s assets are under danger. Furthermore, unlike ordinary corporations, PLLCs are not liable to double taxation. Instead, the organization’s members receive a pass-through of the earnings and losses, which they then record on their individual tax returns.
Whether a member can also be an employee is another frequent query regarding PLLCs. Yes, a member can work as an employee. It is crucial to remember that members are not treated as employees for tax purposes, so they are not eligible for benefits like workers’ compensation, unemployment insurance, and Social Security.
Employees are something that PLLCs are capable of having. In fact, PLLCs frequently employ staff members including secretaries, paralegals, and assistants to help operate their businesses. PLLCs must also abide by all applicable state and federal employment laws, including as those governing workplace safety, minimum wages, and discrimination.
It’s crucial to remember that a PLLC itself owns the property when discussing property ownership in a PLLC. This implies that the PLLC, not its individual members, is the owner of whatever assets or properties it acquires. Members may, however, make loans to the PLLC or buy real estate and lease it back to the business.
In Alabama, licensed professionals who want to safeguard their personal assets while providing their services to clients have access to special advantages thanks to professional limited liability companies. To maintain compliance with state and federal legislation, it is crucial to comprehend the restrictions and guidelines regarding PLLCs, such as tax reporting, employee status, and property ownership. You can manage the process of forming and running a PLLC by seeking the counsel of a legal and financial expert.
No, you are not regarded as a self-employed person as the proprietor of a S corporation. Instead, you would be regarded as a member of the company’s staff and paid a wage. However, if you own a S corporation, you might still be required to pay self-employment taxes on any additional income you make. To calculate your precise tax liabilities, it is advised that you speak with a tax expert.