What is an LLP?
A Limited Liability Partnership (LLP) is just as it sounds, a partnership of two or more persons who have limited liability in the partnership. Limited Liability Partnerships provide partners of the LLP the ability to manage the business directly, yet separate the liability of each partner. A Nevada LLP structure protects individual partner’s personal assets from the negligence or misconduct of each of the other partners. A Nevada LLP is designed to preserve personal assets of individual partners if a lawsuit were filed against the business.
Similar to an LLC, a Nevada LLP’s ownership interest is usually denominated in “units,” (which are essentially the same as “stock”) and the owners are referred to as “members” of the partnership. Each member of the LLP is owner and has equal power to make company decisions.
Why choose an LLP?
In a Nevada Limited Liability Partnership (LLP), the LLP is typically able to avoid the double taxation of profits. In a Nevada LLP, company profits are shared equally among its members. Partners are required to report the profits on their individual tax returns. This process afforded to LLP’s is a called “pass-through” taxation. By passing the profits through to the partners, the company avoids paying federal taxes on its profits.
Who should incorporate as an LLP?
Limited Liability Partnerships are best suited for professional groups, such as lawyers and accountants. Limited Liability Partnerships hold each partner individually responsible for their actions rather than as a group. This is especially important in malpractice claims or where the actions of one individual should not hinder the ability of another in the same professional group. Some states, such as California, will not allow professionals to form an LLC, therefore, they are encouraged to form an LLP.
Contact Nevada LLP attorney Greg Smith to structure your Limited Liability Partnership to take advantage of tax structures, safety and proper legal organization. As a Certified Public Accountant* and Nevada LLP lawyer, Greg Smith will work with you and your desires for profitability to structure or restructure your business.
Smith & Shapiro has two convenient locations: Las Vegas in The Lakes neighborhood and in Henderson off St. Rose Parkway. We are open 8:00am – 5:00pm, Monday – Friday. To schedule an appointment, fill out our online contact form above or call (702) 318-5033.