Which of the following is true of a limited liability company?
A)A limited liability company is not obliged to file the articles of organization with the state.
B)The owners of a limited liability company are personally liable for the business's debts.
C)A limited liability company can elect not to pay business income tax.
D)The owners of a limited liability company cannot participate actively in management of the business.

Question

Quizplus · Accepted Answer

A limited liability company can elect to be taxed as a partnership, with the profits flowing through to the individual owners and taxed at their personal tax rates, rather than paying business income tax. Choices A and B are incorrect because a limited liability company must file articles of organization with the state, and the owners are not personally liable for the business's debts. Choice D is incorrect because the owners can participate actively in management of the business.

Which of the Following Is True of a Limited Liability