What’s the difference between an LLC and Inc when starting a business?

[alenaghose]

I’m planning to register a business and came across LLC and Inc (corporation) as options. Can someone explain the key differences between the two in terms of ownership, taxes, and structure? Which one is better for a small business or startup in the U.S.? Appreciate any guidance.

 

[daisyfrank]

An LLC (Limited Liability Company) offers flexible management and pass-through taxation, while an Inc (Incorporation) is a corporation with stricter structure and potential for stock issuance. Both provide liability protection but differ in tax and ownership rules.

 

[niyati]

• LLC (Limited Liability Company): Flexible structure, protects personal assets, fewer formalities, pass-through taxation (profits taxed once via owners). Best for small–medium businesses.
• Inc (Corporation): More rigid, strict compliance, ability to raise capital via shares, double taxation (unless S-Corp). Best for larger growth-focused businesses.