Limited Partnerships
An excerpt from the Office of Indian Energy and Economic Development’s ‘Choosing a Tribal Business Structure’:
There are two types of partnerships--general partnerships ("GPs") and limited partnerships ("LPs"). The differences are discussed below.
a) General Partnerships In a GP, each partner of the GP assumes general personal liability for the activities of the partnership. A GP is easily organized but is not frequently utilized unless the joint venture partners are incorporated or have some form of liability protection.
b) Limited Partnerships an LP is a partnership with one or more limited partners and at least one general partner. The most popular feature of the LP is the limited liability of the limited partners. The limited partners are protected against personal liability for debts of the partnership that exceed their equity or capital contribution to the partnership. However, in order to retain this limited liability, the limited partners may not participate in the management or control of the partnership's business. Unlike the limited partners of an LP, the general partners of an LP assume general personal liability for the activities of the partnership.
