LLC is an abbreviation for Limited Liability Company, which describes one way in which a business owner can choose to register his or her organization. The specific rules that govern the founding and maintenance of an LLC vary from state to state, but in general an LLC is a company that exists for the duration of a partnership between two or more businesspeople, whereas a full corporation is an independent entity that can have a rotating leadership. Although an LLC is not as permanent as a corporation, it can help simplify the process of doing business, and can offer some financial protection to the partners involved. An LLC is relatively simple to set up, and in most states requires much less legal paperwork and registration fees than the founding of an S or C type corporation.

In some cases, a single person may serve as the entire board of an LLC. Many self-employed people decide to spearhead their own LLC for tax purposes. In addition, an LLC can help you separate your personal debts and assets from those of your business. Doing business as an LLC rather than as an individual can make quite a lot of financial sense, so if you are currently working as a freelancer or as an independent contractor, you may find it well worth your while to look into how your state regulates LLCs.

As an employee, working for an LLC is in most ways the same as working for any kind of company, so unless you are founding a business you probably have no cause to worry about the intricacies of how an LLC is different from a full corporation. However, the laws governing the distribution and sale of stock options for an LLC are different than the rules a corporation must abide by on these fronts, so it is a good idea to become as educated as you can about these issues. An LLC often faces a lower level of taxation than an S or C corporation, which can translate into higher salaries for employees or larger benefits for stockholders, but these savings don't always trickle down.