Which of the following business entities provides limited liability to ALL its owners and allows for 'pass-through' taxation?

Answer options:

C Corporation

General Partnership

Limited Partnership

S Corporation

How to approach this question

Limited Partnership = At least one General Partner liable. S Corp/LLC = Everyone protected.

Full Answer

D.S Corporation✓ Correct

An S Corporation provides limited liability protection to all shareholders (like a C Corp) but is taxed as a pass-through entity (like a partnership). A Limited Partnership must have at least one general partner with unlimited liability.

Common mistakes

Thinking Limited Partnerships protect all partners.

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