An act of the General Assembly, effective earlier this year, will make the use of LLP’s more advantageous than ever. The new law permits an existing limited partnership to register as a “limited liability limited partnership” or LLLP.
Registration as an LLLP protects all partners, including the general partner, to the same extent that stockholders of a corporation are insulated from the partnership’s debts and obligations.
To register as an LLLP, an existing limited partnership must: (1) amend its certificate of limited partnership, as filed with the State Department of Assessments and Taxation, to include the information that is required to register an LLP; and (2) use the words Limited Liability Limited Partnership or the abbreviation LLLP as the last words or letters of its name.
Most significant about this new statute is that the registration of a limited partnership as an LLLP does not require recording a new deed because title is not being conveyed to a new entity (thus avoiding transfer and recordation tax issues). The partnership is merely changing its status to an LLLP.
Owners of limited partnerships with individual general partners (versus corporate general partners) should now seriously consider limiting liability with registration as an LLLP.
