Limited Partnership

General Real Estate Investing
1

I know that a LLC is the way to go for holding properties.

But it seems that a LP would be more appealing to investors. LP just seems so much more simple and clear cut.

I as General Partner - who takes on the responsibility of being manager of partnership - the unlimited liability of owning partnership and personally guarantees loans and such (if needed) and the limited partners (investors) would have no liability other than the money invested.

Seems like it “frees up” the limited partners - whereas the LLC just seems more complex and such an effort for say, one deal.

With operating agreements, member meetings and the rest, the LLC is surely a handful.

But in the long run, it seems, for liability issues, namely the unlimited liability of the general partner of LP - it would seem the LLC is the way to go anyway, even for a joint venture type investment (ie. flip).

2

What are you trying to accomplish?

After you determine that, then seek the competent advice of a CPA or Tax Attorney to guide you in the correct decision. Every situation is different, and one form of an entity does not solve every problem, as LLC’s are touted by some in the forums.

Some patrons have valid points, but it will ultimately depend on your unique situation. LLC’s do accomplish many objectives if used properly. But they do not solve every problem.

It all comes back to “what are you trying to accomplish?”

3

so, why, exactly, would you WANT unlimited liability in a property? That defeats the point of entities in the first place: asset protection.