Which of the following is an advantage of forming an LLC?

The advantage of forming an LLC that stands out is its ability to continue indefinitely regardless of member changes. This characteristic is significant for maintaining business continuity and stability. In an LLC, even if one member leaves or new members are added, the business itself is not dissolved. This allows for easier transfers of ownership and an ongoing operations structure, which can be appealing for long-term planning and investment.

While contracts and membership agreements are indeed important for defining relationships and responsibilities within an LLC, they do not negate the fundamental advantage of having continuity. Other entities, such as partnerships, may face dissolution if a partner leaves, making the indefinite structure of an LLC a strategic advantage for many business owners.

The notion of requiring no formal contract to establish a business is misleading; while LLCs have a more flexible formation process compared to corporations, they still benefit from an operating agreement to outline member roles and responsibilities. Thus, the defining strength of an LLC is its perpetual existence even amidst shifts in its membership.