A limited partnership is a type of business organization recognized in Texas and most states where the management rights and responsibilities are vested in one or more general partners while most of the ownership interests are vested in limited partners. A limited partnership is a flow-through entity for income tax purposes, meaning that the partners pay income taxes or enjoy tax benefits individually, based upon their ownership interest in the partnership. A family limited partnership is not a different type of business organization. Rather, it is often used to describe a limited partnership where most or all of the general partners and limited partners are related to each other.

Last updated on January 6, 2011 by Glenn Karisch