A Limited Liability Partnership (LLP) is a business relationship in which one partner is not responsible for the negligent acts committed by another partner or by the employees not under that partner's supervision. A Limited Liability Partnership is essentially a General Partnership, but each partner is not liable for certain acts of other partners. A LLP also limits the personal liability of a partner for the errors, omissions, incompetence, or negligence of the partnership's employees or other agents. State laws vary regarding LLP's and only about half of the states recognize them. Each of the partners (there can be more than 2) shares in the profits and shares in the debts of the LLP, including losses, unless the partner is a limited partner. A LLP is considered an association of co-owners for tax purposes, and each co-owner is taxed on his or her proportional share of the LLP profits.
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Frequently Asked Questions