Utah General Contractors - Business and Law Practice Exam

What legal form allows for an owner to keep their business interests private?

1. Sole Proprietorship

2. Corporation

3. Limited Liability Partnership

4. Limited Liability Company

The correct answer is: Limited Liability Company

A Limited Liability Company (LLC) is the legal form that allows an owner to keep their business interests private. One of the key advantages of an LLC is that it provides a level of privacy not found in other business structures. Unlike corporations, which are required to disclose various operational details to the state and other stakeholders, LLCs often have fewer disclosure requirements. Additionally, LLCs offer personal liability protection for their owners (members), which means that the personal assets of the members are generally protected from business debts and legal liabilities. This combination of limited liability and the ability to maintain a degree of anonymity makes LLCs a popular choice for business owners who seek to keep their interests private. While other structures, like corporations and limited liability partnerships, have their own benefits, they often come with more stringent reporting requirements and less privacy regarding ownership and financial matters.