An LLC offers its owners limited liability protection from debts and liabilities. This differs from a partnership, where each partner is personally liable for the partnerships obligations and liabilities. And it is different from a corporation, where the shareholders are personally responsible for its debts and liabilities. An LLC has the advantage of being a pass-through entity for tax purposes. This means that the LLC itself does not pay taxes. Instead, the LLCs owners pay taxes on their share of the LLCs profits. The LLCs owners pay taxes on their share of the companys profits instead of the corporation itself paying taxes on its earnings. The management system of an LLC can be designed to match the requirements of the business, and the LLCs owners have influence over how the company is run, which is another benefit. This differs from a corporation, which must be overseen by a board of directors, and a partnership, which the partners must manage. In general, an LLC has several advantages over both corporations and partnerships.