Question

multiple choice question
what type of business structure is owned by shareholders and is taxed as a separate entity?
o limited partnership
o c corporation
o limited liability company
o s corporation

Explanation:

• A limited partnership has partners (general and limited) but is not typically owned by shareholders in the same sense as a corporation.
• A C - corporation is owned by shareholders. It is a separate legal entity and is taxed as a separate entity (double - taxation: corporate income tax and then shareholders pay tax on dividends).
• A limited liability company (LLC) is a pass - through entity for tax purposes (taxes are passed through to the owners' personal tax returns).
• An S - corporation is also a pass - through entity for tax purposes (taxes are not paid at the corporate level but passed through to shareholders).

Answer:

B. C corporation