Which statement is true?
A) LLCs cannot have earnings pass through as personal income.
B) LLCs are ideal for joint ventures.
C) S-type corporations can be partially owned by other corporations.
D) LLCs can only be owned by people and not other corporations.

Question

Quizplus · Accepted Answer

LLCs are a popular choice for joint ventures due to their flexibility in management and ownership. They also offer pass-through taxation, meaning profits and losses are passed on to the owners and reported on their personal tax returns. However, they can be owned by individuals, corporations, or even other LLCs. S-type corporations can also be partially owned by other corporations, but they have stricter eligibility requirements and limitations on the number and type of shareholders. Option A is incorrect as pass-through taxation is a key feature of LLCs. Option D is also incorrect as LLCs can be owned by corporations.

Which Statement Is True