A Limited Liability Partnership (LLP) is considered to be a combination of a partnership and a corporation. Under the structure of an LLP, partners are not responsible or liable for another partner’s misconduct or negligence. Unlike a Limited Partnership, the LLP does not require a general partner. The partners are all responsible for the day to day activities.
Many professional groups such as lawyers, accountants or doctors find this of type business structure very attractive because they are protected from debts against the partnership arising from professional malpractice lawsuits against another partner.
Similar to Limited Liability Companies, LLPs are “pass through” entities. Instead of the business paying taxes, the income passes through to the owners.
Like other types of companies, an LLP is formed in the state in which it does business. Most states have the required forms at their website.
Formation of an LLP typically requires filing certificates with the county and state offices. Although specific rules vary from state to state, all states have passed variations of the Revised Uniform Partnership Act. LLPs formed in California, New York, Oregon, and Nevada can only be formed for professional uses. Some US states have combined the LP and LLP forms to create limited liability limited partnerships.
The company must register as a specific LLP in the state by filing a form such as “Articles of Organization” or a similar type. With its’ members, the LLP should also create an operating agreement that details how the company is managed and what will happen under various circumstances.
UCS is with you every step of the way by providing the necessary forms to file with the Secretary of State as well as assist with drafting and submitting to the proper department. UCS also provides a registered agent office which is required in most states.