There is pass-through taxation. This means that there is no income tax for partnerships, but income tax is charged individually on the total share, including the salary and interest received by each partner. The disadvantage associated with the limited liability company is that LLC owners must pay taxes on their distributive share of the company's profits, even if they have not received a distribution of those profits and sometimes the business grows too large and the share received by the partner is lower and if his other income is higher, the partnership share received is also taxed at higher federal income rates