Limpart Considerations in Forming a Limited Partnership A limited partnership is a specialized form of general partnership. While it is very similar to a general partnership in most aspects, the limited partnership is made up of at least one or more general partners and at least one or more limited partners. Limited partners may not take a role in the management of the business. If they do, they could be found to be general partners and therefore assume unlimited liability for business debts as a general partner.
Limited partnerships are attractive organizations for purposes of raising capital.
The Limited partners are usually investors who have no particular expertise in the business operations. They are usually investors seeking investment opportunities with the hope of earning a meaningful return on their investment in a successful venture. The Principal Characteristics of Limited Partnerships Many characteristics of a limited partnership are similar to those of a partnership, yet some of its features are similar to a corporation. A limited partnership may be created only in accordance with a statute. If the statute is not followed, unlimited liability may be imposed on all the partners.