Investment potential with limited risk is one of the key features that makes the limited partnership most attractive. Less risk with maximized profit and diminished loss—along with averting disaster—has made such business foundations popular. And while the LLC has overshadowed the limited partnership in the past few decades, there are still reasons to turn to the limited partnership instead.
A Partnership Business May Suit Investors with Varying Financial Interests
If you know you will be going into business with several individuals, a partnership business may be the perfect route, although it is best to consult with an experienced business attorney like Shane Coons first to review all your options, as well as discussing how to set up your business and create any required partnership contracts too.
Limited Partners Still Enjoy Many Benefits of the Partnership
The limited partnership is usually managed by one main—or general—partner. It may also involve a group of individuals and partners who are all extremely hands-on in the business, or there may be several who participate less but still enjoy all the benefits even as limited partners.
Partners are not liable for any more than they have put into the business, and they usually aren’t held responsible for debts of the business either. Because of this, you should be able to attract more investors, and often including those who you may know well, whether they are family members or others in your social circle who you may have known for a long time.
Partners May Enjoy Substantial Tax Breaks
There is much less deliberation and stress involved in only having to make a smaller contribution. Partners also only pay taxes depending on their amount of annual profits, as reflected on individual, personal tax returns. There may be other substantial tax breaks also that are very enticing to all involved.
You Can Hire Someone Else to Manage the Partnership
As the manager of the partnership, you may get paid more out of dividends, or you may all agree that you prefer to hire someone to run the partnership, dealing with all the administrative duties and leaving you to focus on the company itself. Voting power regarding the company can be set up however you and the rest of the investors decide as well; however, with the help of a skilled business attorney you will have the guidance necessary to avoid any missteps.
Contact Us for Help
Do you have questions about partnerships or another business matter? If so, contact Attorney Shane Coons. Our law office represents clients involved in a wide range of businesses and legal issues, and we would be glad to review your case and help you explore your options.
Call now at 949-333-0900 or email us at Shane.Coons@seclawoffices.com.