Which statement best describes a Limited Liability Company (LLC)?

• A. Similar to Sub S in which profits/losses flow to shareholders.
• B. Owners can be individuals or shareholders (no limit).
• C. Manager typically appointed to run.
• D. No personal liability for LLC members.

Answer: (D)

The main idea here is the liability protection an LLC provides. An LLC is designed so members are not personally responsible for the company’s debts or lawsuits in normal business operations, so their personal assets are generally shielded beyond the amount they invested. This limited liability is what the statement “no personal liability for LLC members” describes most directly. Exceptions exist, such as if a member personally guarantees a loan, commits fraud, or a court pierces the veil, but those are not the typical scenario. The other options miss this key point: one references shareholders and corporate taxation terms that don’t accurately apply to LLCs; another notes a management setup that can vary (member-managed or manager-managed) rather than a universal rule.