All of the shareholders of an S corporation have limited liability with respect to their ownership interests in the corporation whereas only limited partners in a limited partnership have such limited liability.

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In an S corporation, all shareholders enjoy limited liability, meaning they are only liable up to the amount of their investment in the corporation. In contrast, in a limited partnership, only the limited partners have limited liability, while general partners have unlimited liability for the debts and obligations of the partnership.

All of the Shareholders of an S Corporation Have Limited