In most states,a limited liability company (LLC)is subject to the state income tax:

Question

Quizplus · Accepted Answer

Most states treat LLCs as flow-through entities, similar to Federal treatment. This means that the income of the LLC is passed through to the owners and is only taxed at the individual level, not at the entity level. Therefore, the LLC itself is not subject to state income tax, but its owners are. Option A and B are incorrect because they imply that the LLC is subject to the state income tax as a separate entity. Option D is incorrect because LLCs are generally not exempt from state income taxation.

In Most States,a Limited Liability Company (LLC)is Subject to the State