One major advantage of forming an LLC is the limited liability protection offered; this ensures that business owners’ personal assets are protected from any debts incurred during operation, thus providing greater financial security for them. There are also fewer restrictions than other business forms, such as the need for less members and no board of directors. Taxation is also more flexible compared to corporations, which offer corporate and pass-through rates.
There are also some disadvantages when selecting an LLC structure, such as the potential for complications in case of rapid expansion; any changes to equity structures must be made according to state law or face penalties. Furthermore, shareholders do not have voting rights within LLCs meaning that decision making power remains largely within the hands of those managing operations on a daily basis (Khoury & El Khoury, 2016).
In conclusion forming an LLC was a wise decision for this company given its size and stage of development; it provides more flexible management options than other structures while also offering legal protection against creditors – however there may be challenges further down the line should significant growth occur so careful consideration should be taken ahead of any decisions related to restructuring.