Since the passage of the sixteenth amendment' in 1913 and the income tax legislation adopted thereunder, the development of new forms of business entities has been driven largely by the desire to harmonize two goals: limited liability for the owners of the entity and pass-through treatment of the entity for income tax purposes.
S. B. Farmer & Louis A. Mezzullo,
Annual Survey of Virginia Law: The Virginia Limited Liability Company Act,
U. Rich. L. Rev.
Available at: http://scholarship.richmond.edu/lawreview/vol25/iss4/13