The primary advantage of being a limited partner is:
A) the receipt of tax-free income.
B) the partner's active participation in the firm's activities.
C) the lack of any potential financial loss.
D) the daily control over the business affairs of the partnership.
E) the partner's maximum loss is limited to their capital investment.

Question

Quizplus · Accepted Answer

The primary advantage of being a limited partner is that the partner's maximum loss is limited to their capital investment. This means that if the partnership were to incur debt or suffer financial losses, the limited partner would only be liable for the amount they invested and not responsible for any additional debts or losses.

The Primary Advantage of Being a Limited Partner Is