A Limited Liability Company (LLC) is a legal business structure allowed by state statute.
General Partnership provides an individual partner protection against personal liability for certain partnership obligations.The Limited Liability Partnership (LLP) is essentially a general partnership in form, with one important difference. Unlike a general partnership, in which individual partners are liable for the partnership’s debts and obligations, an LLP provides each of its individual partners protection against personal liability for certain partnership liabilities.
Limited partnerships allow partners to have limited liability as well as limited input with management decisions. These limits depend on the extent of each partner’s investment percentage. Limited partnerships are attractive to investors of short-term projects.Some states limit the creation of a limited liability partnership to professionals such as doctors, Accountants, or lawyers.
The leverage of having LLP is each member is personally responsible for the actions of the company, which includes debts, liabilities and the wrongful acts of other partners. No double taxation, the company are passed through to partners to file on their individual tax returns. Credits and deductions are divided by the percentage of individual interest each partner has in the company. On the other hand, the downside is individual partners are not obligated to consult with other participants in certain business agreements.
