Overview of Limited Liability Partnerships
Most doctors, lawyers, and other professionals have insurance against malpractice and other types of litigation because claims against these professionals are now a daily occurrence. No professional today, however, can rely solely upon insurance for protection. There are now many other opportunities for professionals to incur liability arising from their practice. The need for sound organizational protection for professionals clearly matches that of the commercial business owner or family with wealth preservation concerns. Enter the limited liability partnership, a special type of partnership created for those engaged in professional occupations, such as doctors, lawyers, dentists, architects, and accountants.
It is called a limited liability partnership (LLP). It closely resembles the limited partnership, although there are important differences. While the limited liability partnership protects the professional partner from both debts incurred by the practice and claims resulting from the malpractice of any other partner, it does not protect the professional partner from personal claims resulting from his own malpractice. Moreover, limited liability partnership assets cannot be directly seized by the professional partner's personal creditors, except when the negligent partner was acting on behalf of the limited liability partnership as his principal. Nor can the professional partner's personal creditors easily liquidate his interest in the limited liability partnership, because ownership interest in this type of partnership must usually be owned by professionals from within that specific field. This makes the limited liability partnership an excellent option when professionals want to participate in the management of the practice, while still insulating their personal assets from the partnership liabilities.
YES, YOU CAN LOSE EVERYTHING!
You may think that your wealth is safe and that you don't need protection. But don't delude yourself and accept reality —
for every 60 minutes you spend making money, spend 60 seconds thinking about how to protect it!