Which of the following is not a characteristic of a limited liability company?

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Question

Which of the following is not a characteristic of a limited liability company?

a. Limited liability

b. Unlimited life

c. Always taxed as a corporation

d. Generally has an operating agreement drawn up by an attorney

business accounting

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Answer 1

Answer #1

Always taxed as a Corporation is not a characteristic of a limited liability company .

An LLC by default is treated as a pass through entity where the income is taxed in member's individual income tax return. So unlike Corporation, there is no double taxation is case of LLC.

However an LLC may elect to be taxed as a Corporation by filing Form 8832.

Option C is correct

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Answer 2

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