Which of the following business organizational forms provides the owners with limited investor liability and passes its income before taxes through to the owners?
A)partnerships and S corporations
B)S corporations and C corporations
C)C corporations and limited liability companies (LLCs)
D)S corporations and limited liability companies (LLCs)

Question

Quizplus · Accepted Answer

Both S corporations and limited liability companies (LLCs) provide owners with limited investor liability and pass their income before taxes through to the owners. C corporations provide limited liability but do not pass income before taxes through to the owners. Partnerships provide both unlimited liability and pass-through taxation. Therefore, the best choice(s) are D, which includes only S corporations and LLCs.

Which of the Following Business Organizational Forms Provides the Owners