- November 20, 2017
A limited liability partnership (LLP) is a partnership in which some or all partners have limited liabilities. It has elements of a partnership and a corporation. In an LLP, one partner is not responsible or liable for another partner’s misconduct or negligence. In an LLP, some partners have a form of limited liability similar to that of the shareholders of a corporation. Unlike corporate shareholders, the partners have the right to manage the business directly. In contrast, corporate shareholders have to elect a board of directors under the laws of various state charters. The board organizes itself (also under the laws of the various state charters) and hires corporate officers who then have as “corporate” individuals the legal responsibility to manage the corporation in the corporation’s best interest. An LLP also contains a different level of tax liability from that of a corporation.