The Proper Billing for an LLC

A limited liability company (LLC) is formed under the laws of a state. (Ref. 1) Once it is registered with a state, it becomes a legally independent entity, authorized to conduct business in its own name. (Ref. 2) It must use its business name, with "LLC" appended to the end, to properly notify the public of its legal status. (Ref. 5)

Independent Entity

• A LLC is an independent legal entity, separate from its owner, the same as a corporation. It can remain in existence until it is dissolved, even if the owner dies. It can sue or be sued and it is able to contract, seek credit and acquire debts in its own name.

Limited Liability

• One of the benefits of the LLC format is that owners enjoy the limited liability a corporation enjoys. The owners are not personally liable for the actions and debts of the LLC. A creditor can only pursue the assets of the business and not the owner's personal assets.

Billing

• Since an LLC is an independent legal entity, the proper way for a creditor to bill the business is to address the bill to the LLC's official business name. This is the name registered with state authorities. A creditor may address a bill to the attention of an LLC owner or manager, but that person is not liable for the debt unless the LLC was never properly authorized to conduct business in the state.