limited liability
Protected personal assets
Limited liability is a legal structure protecting owners from personal responsibility for a business's debts or legal judgments.
If the company fails or gets sued, creditors can pursue only business assets, not the owners' homes, cars, or savings.
This protection is the main reason entrepreneurs form corporations or LLCs rather than operating as sole proprietors: The limited liability structure meant investors could lose their stake but nothing more.
Legally separate business entity
- LLCHybrid business entity abbreviation
- incorporationForming a legal entity
- shareholdersOwners of company stock
- entityIndependent existing thing
partnership · subsidiary · holding company · bylaws · corporate veil · fiduciary · registered agent · sole proprietor
Impartial treatment or ownership value
- capitalWealth used for investment
- sharesUnits of company ownership
- dividendsProfits paid to shareholders
- assetsOwned items of value
debts · liabilities · creditors · insolvency · bankruptcy · solvency · capitalization · investment
Handheld defensive armor
- safeguardPrecaution against harm
- separationState of being apart
- immunityProtected from harm
- bufferProtective intermediate space
defense · indemnity · asset protection · ringfencing · firewall · shelter · insulation · compartmentalization
corporation
Legally separate business entity
- LLCHybrid business entity abbreviation
- incorporationForming a legal entity
- shareholdersOwners of company stock
entity · partnership · subsidiary · holding company · bylaws · corporate veil · fiduciary · registered agent · sole proprietor · S-corp
equity
Impartial treatment or ownership value
- capitalWealth used for investment
- sharesUnits of company ownership
- dividendsProfits paid to shareholders
assets · debts · liabilities · creditors · insolvency · bankruptcy · solvency · capitalization · investment · stockholder
shield
Handheld defensive armor
- safeguardPrecaution against harm
- separationState of being apart
- immunityProtected from harm
buffer · defense · indemnity · asset protection · ringfencing · firewall · shelter · insulation · compartmentalization
- Corporate Termssubsidiary, CFO, affiliate, division, merger
- corporate historyincorporation, chartered companies, corporate law, mergers, acquisitions
- private companiesstartup, Ltd, LLC, partnership, sole proprietorship
- business lawbusiness law, commercial law, corporation, commercial code, S corp
- corporate lawincorporation, shareholders, corporate governance, shares, corporation
- corporate liabilitycorporate veil, piercing the veil
limited liabilitystrict liability
Legal responsibility without fault
limit, limited, limits, unlimited, limitation, liability, limiting, preliminary, delimit