Unlike a limited partnership, the LLC is taxed on all profits before they are paid out to its members.

Name: Unlike a limited partnership, the LLC is taxed on all profits before they are paid out to its members.
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The LLC has pass-through taxation, meaning that profits and losses are passed through to the individual members and are taxed on their personal income tax returns. The LLC itself is not taxed on its profits before they are distributed to members.

Unlike a Limited Partnership, the LLC Is Taxed on All