Exam 38: Limited Liability Companies and Special Business Forms

Commerce & Trade Corporation and Distance Shipping & Transport, Inc., form a business trust. eCharge Auto Company and Fleet Electric Corporation form a joint stock company. Green AgriCorp and Harvest Farms, Inc., form an incorporated cooperative. What features do these combinations of business organization have in common?

Licensed fishing outfits in Bayou City form a business organization to provide, without profit, an economic service to its members. This is

Limited liability companies are entities apart from their owners.

Unless a limited liability company indicates otherwise, the Internal Revenue Service automatically taxes it as a partnership.

Unless otherwise agreed, joint venturers have an equal voice in controlling a venture-related project.

A limited liability company is a citizen of every state of which its members are citizens.

To form a limited liability company, articles of organization must be filed with the federal Small Business Administration.

For federal income tax purposes, one-member limited liability companies are not taxed.

Joint venturers do not have the authority as agents to enter into contracts for the business that will bind the joint venture.

A limited liability company can be taxed as a corporation.

Like the shareholders of a corporation, the owners of a limited liability company are liable for the obligations of the firm to the full limit.

A syndicate may be organized as a corporation or a partnership, or in some situations as no recognizable form of business organization.