Which form of business organization allows owners to have limited liability for company debts?

The form of business organization that allows owners to have limited liability for company debts is the corporation. In a corporation, the business is considered a separate legal entity from its owners (shareholders). This separation means that shareholders are generally not personally responsible for the debts and liabilities of the corporation. If the corporation faces financial difficulties or is sued, the most that shareholders can lose is their investment in the company; their personal assets remain protected. This limited liability is a significant reason many entrepreneurs choose to incorporate their businesses, as it mitigates personal financial risk.

In contrast, partnerships and sole proprietorships do not provide this level of protection. In a partnership, the partners can be personally liable for the debts of the business, and in a sole proprietorship, the owner is personally liable for all debts incurred by the business. Franchises are not a separate business structure but rather a method of doing business, and franchisees may also face personal liability depending on their business structure. Hence, the corporate structure is distinctly advantageous for limiting personal liability, making it the correct answer in this context.