One of the distinct advantages of filing an LLC (limited liability company) with the Secretary of State of Alabama is the limitation on personal liability for the entity's debts and obligations. An LLC blends the advantages of both partnerships and corporations - offering the protections that are afforded by corporations, with the simplicity of a partnership.
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Business owners commonly form corporations to separate and protect personal assets from business liabilities. A properly formed corporation permits owners, directors, and officers to focus on managing the business without having to worry about placing personal assets at risk. Personal homes, cars and savings accounts are protected from a corporation's obligations or debts.
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Business owners commonly seek the protections of a corporation when they are concerned about placing personal assets at risk. The liabilities of a business can damage a business owner's personal credit, savings, and assets if not managed correctly. A properly structured corporation allows owners, directors & officers to manage the business without worrying about potentially losing a home, car or personal savings due to business obligations.
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When a corporation plans on engaging in what the state defines as a professional service, then a "Professional Corporation" must be formed pursuant to certain statutory provisions. Professional services, according to most states, usually consist of activities involving medical, legal, accounting and financial services, among others.
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