Which of the Following Is True of Compensation Offered by an LLC

question 47

Multiple Choice

Which of the following is true of compensation offered by an LLC (limited liability company) ?

• A)Managers of an LLC are entitled to compensation and not benefits.
• B)Members are not entitled to compensation for their services toward the LLC.
• C)Members are not indemnified for liabilities in the ordinary course of business.
• D)A nonmember manager of an LLC is not entitled to compensation.

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Definitions:

Legal Entity Type

Categories under which business or organization structures are legally recognized, such as LLC, corporation, partnership.

Tax Form

A document used to report financial information to a governmental body for the purposes of tax calculation and compliance.

IRS

Internal Revenue Service, the federal agency responsible for administering and enforcing tax laws in the United States.

Form 1040 Schedule C

A tax form used in the United States for reporting income or loss from a business operated as a sole proprietorship.