Which of the Following Statements Is TRUE for a Limited

question 117

Multiple Choice

Which of the following statements is TRUE for a limited liability partnership?

• A)The partnership pays no federal income taxes.
• B)Only the limited partners pay federal income taxes on their shares of the partnership's profits.
• C)Only the general partner pays federal income taxes on his or her share of the partnership's profits.
• D)Only the members pay federal income taxes on their shares of the partnership's profits.

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Definitions:

Reasonable

Pertaining to actions, decisions, or conditions that are logical, fair, and sensible under the circumstances.

Public Interest

The welfare or well-being of the general public and society, often considered in legal and policy decisions.

Restricts

Imposes limitations or conditions on actions, access, or behaviors, often through regulations, laws, or contracts.

Bankrupt

A legal status of a person or entity that cannot repay the debts it owes to creditors.