Question

In the context of legal forms of business, identify a true statement about limited liability partnership (LLP).

a. Limited partners in a limited liability partnership must be external advisors who do not have a stake in the ownership of the firm.
b. All partners in a limited liability partnership are jointly responsible for any debts or judgments against the firm.
c. In a limited liability partnership, limited partners can work at the firm but not be active in its management.
d. General partners in a limited liability partnership are indirectly responsible for federal taxes owed by the firm.

Answer 1

In a limited liability partnership (LLP), limited partners can work at the firm but not be active in its management.

Step-by-step explanation:

A limited liability partnership (LLP) is a legal form of business organization. A true statement about LLP is option c: In a limited liability partnership, limited partners can work at the firm but not be active in its management. This means that while limited partners have some involvement in the firm, they do not have direct control over its day-to-day operations.