An LLLP is a new modification of the limited partnership. Similar to a limited partnership, the LLLP consists of one or more general partners and one or more limited partners. The key advantage of this form of ownership is that the general partners receive limited liability on the debts and obligations of the LLLP. However, an LLLP that is formed under the laws of another state must register with the  Secretary of State prior to conducting business in the state.

Key Features

• The general partners manage the business operations of the LLLP, while the limited partners typically only maintain a financial interest.
• The LLLP is a flexible form of business.
• It is designed to offer limited liability to all partners in the partnership.
• The partners will decide the structure of the organization and the distribution of profits and losses. A formal, written partnership agreement is advisable.
• An LLLP does not pay income tax. However an LLLP must pay an annual tax of $xxx. The items of income, deductions, and credits "flow down" from the partnership to each partner through the Schedule K-1. Each partner is responsible for paying taxes on their distributive share.
• An LLLP remains in in existence until any agreed upon termination date.

Filing Guidelines

• Every LLLP that engages in a trade or business or earns income from  sources and every LLLP that registers with the  Secretary of State is required to file taxes as per the state guidelines.
• The LLLP provides each partner with a schedule K-1 that states the partner’s distributive share of the partnership's (LLLP's) items of income, deductions, and credits.
• The return due date is the 15th day of the 4th month after the close of the taxable year.
• An LLLP must pay an annual tax.

Estimated Tax

• No estimated tax requirements.
• The LLLP may be required to withhold taxes if the partnership distributes source taxable income to a nonresident partner.