Finally, state laws restrict the sales of most limited partnership shares, and the transfer of limited partnership shares may be further restricted by the partnership agreement. By combining the discounts available for lack of marketability, minority ownership, and lack of control over management and income, the value of each limited partnership share might be significantly less than the corresponding value of the underlying assets. It is important to recognize that a limited partnership is a business enterprise, and both your attorney and accountant must be familiar with the business management and tax aspects of a limited partnership. Many estate-planning attorneys insist that a business attorney participate if a family limited partnership is being created as part of the estate planning process. However, a corporation and limited partnership may both be used to maximize the available discounts.
Limited partnerships offer a number of additional benefits and drawbacks.