Travis: Great. Along the same vein of thought, how does an LLC differ from an LLP?
Jake: An LLP is a limited liability partnership. So, essentially, that is taxes as a partnership versus the flexibility that an LLC has. An LLC can be taxed in a multitude of ways, as we've talked about before. But a limited liability partnership is really that – it's a partnership. And it does have limited liability protection for the partners.
So, that in essence is probably the biggest difference between an LLC and an LLP?
Travis: So why would anybody form an LLP over an LLC?
Jake: It really is more for professionals such as an attorney. When it comes to liability protection for professionals, like I said attorneys. Because then you can separate out individual liability within the partnership.
Travis: I see.
Jake: But that's something that I would definitely recommend talking with an attorney about and seeing in my specific situation, what you you recommend? Would you recommend the LLC or would you recommend the LLP? And, different scenarios within their situation can dictate one answer versus another.
Travis: Right. Everybody has their own specific situation that can't be covered in a phone call like this.
Jake: Right.