QUESTION
Which type of corporation can have up to 100 owners, faces only one level of federal taxation, and can provide its owners with both salaries and distributions?
A) an LLC
B) an LLP
C) a C corporation
D) an S corporation
E) a B corporation
ANSWER
Answer: D
Explanation: D) An S corporation has no more than 100 owners (shareholders), but, like a partnership, the owners are taxed at only the personal (not corporate) level. The owners have little or no liability for the debts of the business.
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