A limited partnership (or “LP”) is a business entity selection that allows investors – known as limited partners – to invest assets into a business that is operated by others – known as general partners. LPs are primarily used to help protect the personal assets of investors from the debts and obligations of the business in which they are investing. New Hampshire has enacted the New Hampshire Uniform Partnership Act to regulate businesses, including LPs.
There are several requirements that an LP must meet to maintain its status in New Hampshire. For example, the LP must provide the state with its name. The LP name must contain the words "Limited Liability Partnership" or the abbreviation "L.L.P." or "LLP" as the last words or letters of its name. This requirement exists to ensure those doing business with the LP understand that they are not doing business directly with the partners but with LP.
To form an LP in New Hampshire a Registration of New Hampshire Limited Liability Partnership form must be filed with the state. The form can be mailed or filed online with the New Hampshire Corporation Division. The form will require the LP to disclose its:
- Name and address of a registered agent;
- Office address, phone number, and email of the business;
- Date the LP will end (if possible);
- Name, signature, and address of each general partner; and
- Date the LP was signed.
New Hampshire also requires the LP to state the type of business it plans to conduct. The form is then signed by one of the LP’s partners and submitted for state review.
As with most states, an LP formed in New Hampshire is given two primary benefits. First, the LP’s limited partners are generally not personally liable for the debts and obligations of the LP. Second, the income of the LP is taxed at the partner’s personal level rather than at the business level (this avoids double taxation).
LPs are comparatively simple entities to form. However, there are a few disadvantages to the LP entity. For example, an LP can be difficult to operate. LPs should have very well written operating agreements that clearly explain the rights and obligations of each partner.
If you need help forming an LP in New Hampshire, then contact a local New Hampshire business lawyer today to discuss your rights and obligations under the New Hampshire Uniform Partnership Act.