What does LLC stand for in legal terms?

The term "LLC" stands for Limited Liability Company. This designation is significant in legal and business contexts because it refers to a specific type of business structure that combines elements of both partnerships and corporations.

An LLC provides its owners, known as members, with limited liability protection, meaning that their personal assets typically are shielded from the company's debts and liabilities. This protection is one of the primary advantages of forming an LLC, making it an attractive option for many entrepreneurs and businesses.

Moreover, LLCs offer flexibility in management and tax treatment, often allowing profits and losses to be passed through to members without the double taxation faced by C Corporations. This structure is particularly appealing for small to medium-sized businesses seeking to mitigate risks while maintaining a simpler regulatory framework compared to corporations.

The other options presented do not accurately reflect the term's definition. Limited Liability Corporation, Legal Liability Contract, and Local Legal Committee do not describe a recognized business structure or legal formation. Therefore, the correct choice reinforces an understanding of business entities and the protections they afford to their members.