In states where an LLC may be organized by only one member, __________ can obtain the benefit of the limited liability shield of an LLC.
A. corporations
B. sole proprietors
C. LLPs
D. general partnerships
B
To determine the correct answer, we need to understand the concept of a Limited Liability Company (LLC) and how it functions.
An LLC is a business structure that combines the benefits of a corporation and a partnership or sole proprietorship. One key advantage of an LLC is that it provides limited liability protection to its members.
Limited liability means that the personal assets of the members are protected from the debts and obligations of the LLC. In other words, if the LLC is sued or goes bankrupt, the personal assets of the members, such as their homes or savings, are generally not at risk.
In states where an LLC can be organized by only one member, which is known as a single-member LLC, sole proprietors can obtain the benefit of the limited liability shield of an LLC.
Therefore, the correct answer to the question is B. Sole proprietors.