Business Law - Chapter 18

limited liability partnership (LLP)

a form of partnership that allows professionals to enjoy the tax benefits of a partnership while limiting their personal liability for the malpractice of other partners.

limited liability limited partnership (LLLP)

a type of limited partnership. The difference between a limited partnership and LLLP is that the liability of the general partner in an LLLP is the same as the liability of the limited partner. That is, the liability of all partners is limited to the amount of their investments in the firm.

certificate of limited partnership

the basic document filed with a designated state official by which a limited partnership is formed

limited liability company (LLC)

a hybrid that combines the limited liability aspects of a corporation and the tax advantages of a partnership

family limited liability partnership (FLLP)

a limited liability partnership (LLP) in which the majority of the partners are persons related to each other, essentially as spouses, parents, grandparents, siblings, cousins, nephews, or nieces. A person so related could also be a partner. All of the partners must be natural persons or persons acting in a fiduciary capacity for the benefit of natural persons.

limited partnership (LP)

a partnership consisting of one or more general partners (who manage the business and are liable to the full extent of their personal assets for debts of the partnership) and one or more limited partners (who contribute only assets and are liable only to the extent of their contributions).

operating agreement

in a limited liability company, an agreement in which the members set forth the details of how the business will be managed and operated.

general partner

in a limited partnership, a partner who assumes responsibility for the management of the partnership and liability for all partnership debts.

limited partner

in a limited partnership, a partner who contributes capital to the partnership but has no right to participate in the management and operations of the business. The limited partner assumes no liability for partnership debts beyond the capital contributed.

articles of organizations

the document filed with a designated state official by which a limited liability company is formed

member

the term used to designate a person who has an ownership interest in a limited liability company.