The limited partners cannot make management, investment or distribution decisions, and cannot force the liquidation of the partnership. Therefore, the general partner can maintain control of the business while receiving the benefits of the valuation discounts, among others. To discuss how your estate plan could use the advantages of a family limited partnership, contact a business-finance consultant, such as a certified public accountant, or an attorney who specializes in family businesses. The main disadvantage of a partnership is that in some cases, partners are liable for the actions and commitments of the other partners. In order to reduce the potential for disagreement, the partnership agreement must contain articles which address the decision making process.
Contingencies are likely to arise.
We advise you to consult with your tax specialist on this matter. Creditors cannot take personal holdings or assets should the corporation fail or be sued for more than the corporation is worth. Capital may be obtained by issuing stock or bonds. A corporation is a legal entity in itself and exists wholly separate from the individuals that created it. Death or illness of a principal officer has no affect on the existence of the business.