Those considering their own business will have many options available to them in terms of how the business is classified. Although this seems like something minor, it is not. How a business is classified can play a role in how taxes are filed, liability of assets and so many important things. While a sole proprietorship can seem like the easy choice, this may not be entirely so. The benefits of an LLC far outweigh those of a sole proprietorship. An LLC, also known as a limited liability corporation, can actually protect the owners of a business from being personally sued by those whom they have done business with. As a matter of fact, some individuals whom are essentially self-employed via contract work may choose to operate as an LLC due to the benefits and protections that it may provide them.