David and Jeannie formed This & That as a limited liability company. Unless the member owners elect to be treated otherwise, the Internal Revenue Service will tax the LLC as:
A) An S corporation.
B) A C corporation.
C) A non-taxable entity.
D) A joint venture.
E) A partnership.

Question

Quizplus · Accepted Answer

By default, the IRS will tax a limited liability company as a partnership unless the member owners elect to be treated as a corporation (either an S corporation or a C corporation). A partnership is a pass-through entity, which means that the profits and losses of the LLC are passed through to the individual tax returns of the member owners.

David and Jeannie Formed This & That as a Limited