Family Limited Partnership By Seo Manager

  in Real Estate | Published 2010-07-30 06:22:21 | 276 Reads | Unrated

Summary

Get to know more about asset protection when it comes to protection of your personal and business assets, which includes a family limited partnership.

Full Content

A Family Limited Partnership [“FLP”] is a far more flexible vehicle than an irrevocable trust or “C” or “S” corporations, and, can often accomplish the best of all worlds. For example, under a properly drafted and structured FLP:

1. Transfers of property to a FLP are tax-neutral in that there is no gain on such transfers, and, the basis is the same as that when the property was held by the donor;

2. The donor, or creator, may serve as a limited partner;
r/>3. Family members can control the FLP and receive annual income distributions;

4. Control is vested entirely in the general partner [usually a legal entity], which has the sole legal right to make the day-to-day investment and business decisions affecting the partnership;

5. The FLP is not a taxable entity for income tax purposes, thus avoiding the problem of double taxation as is the case with “C” corporations;

6. Limited partners, as such, are not liable for any debts incurred by the FLP;

7. Highly restricted limited partnership interests are subject to substantial valuation discounts for gift and estate tax purposes;

8. High liability assets and activities can be easily and inexpensively separated from other assets through the utilization of multiple family limited partnerships; and

9. However, only a handful of states actually limit a creditor's remedy solely to a charging order. In most states a judgment creditor may obtain a judicial foreclosure and subsequent sale of the charged partnership interest.

If you believe you can benefit from a properly drafted FLP for your asset protection or business endeavors, then call us today for a free consultation. For more information visit professionalassetprotectionservices.

The Connolly Law Firm has 34 years of experience drafting effective financial and asset planning documents . They use their experience to ensure that you are well protected in any of your financial investments around the world. For more information visit www.professionalassetprotectionservices.com.

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