A limited-liability company is: - always used to organize charitable organizations. - similar to a cooperative. - taxed like a partnership. - taxed like a corporation. - the result of a horizontal merger.

Answer

The correct answer is 'taxed like a partnership.' A Limited Liability Company (LLC) is a hybrid business structure that combines the limited liability protection of a corporation with the 'pass-through' tax treatment of a partnership. This means that the LLC itself does not pay federal income taxes on business profits; instead, the profits and losses are passed through to the individual members, who report them on their personal tax returns, thereby avoiding the double taxation often associated with traditional corporations (C-corps). While an LLC can elect to be taxed as a corporation, its default and most common categorization for multi-member entities is to be taxed as a partnership.