Bus. Structure: LLCs and LLLPs

Question 1

LLCs are generally treated like _________ for tax purposes?

Answer 1

Partnerships.

Question 2

The “articles of incorporation” for an LLC is the…

Answer 2

operating agreement.

Question 3

LLC owners are called…

Answer 3

members.

Question 4

Are the number of members in an LLC restricted? Are the types of members in an LLC restricted?

Answer 4

No and No.

Question 5

What types of companies cannot be LLCs?

Answer 5

banks and insurance companies

Question 6

advantages to LLCs

Answer 6

1. Limited liability of members.
2. Avoid double taxation.
3. Flexible profit distribution.
4. Flexibility of management.

Question 7

LLLP

Answer 7

limited liability limited partnership

Question 8

An LLLP is created to…

Answer 8

convert an existing limited partnership previously created under state law.

Question 9

What is the liability of a general partner in an LLLP?

Answer 9

The general partner in an LLLP has limited liability similar to the limited partners.

Question 10

Do LLCs have an unlimited life?

Answer 10

No. LLCs have a limited life that varies from state to state and LLCs do not issue stock.

Question 11

In an LLC, how is the member’s authority determined?

Answer 11

By what is specified in the operating agreement.