Which of the following is NOT true about a limited liability company?

A) It is a noncorporate business organization.
B) In most states, an LLC must have at least two members.
C) It may elect not to be a separate taxable entity.
D) An ownership interest may be considered a security.

Question

Austin Apesa · Accepted Answer

Final Answer : B, Explanation :  Most states in the United States allow the formation of a limited liability company (LLC) with just one member, making statement B incorrect. LLCs are indeed noncorporate entities (A), can choose how they are taxed, often avoiding double taxation by electing pass-through taxation (C), and their ownership interests can be structured to be considered securities, subject to securities laws (D).

Which of the following is NOT true about a limited liability company?

A) It is a noncorporate business organization.
B) In most states, an LLC must have at least two members.
C) It may elect not to be a separate taxable entity.
D) An ownership interest may be considered a security.

Definitions

Learning Objectives

Learning Objectives

Related questions

Which of the following is NOT true about a limited liability company?A) It is a noncorporate business organization.B) In most states, an LLC must have at least two members.C) It may elect not to be a separate taxable entity.D) An ownership interest may be considered a security.

Definitions

Learning Objectives

Learning Objectives

Related questions

Which of the following is NOT true about a limited liability company?

A) It is a noncorporate business organization.
B) In most states, an LLC must have at least two members.
C) It may elect not to be a separate taxable entity.
D) An ownership interest may be considered a security.