limited partnership

noun

Definition of limited partnership

: a partnership having one or more general partners and one or more limited partners

Examples of limited partnership in a Sentence

Recent Examples on the Web

The suit also names Sang Hun Shim, the business's owner, and Shady Wi Investment, the domestic limited partnership that owns the property in the 10900 block of Shady Trail. — Lavendrick Smith, Dallas News, "City files lawsuit to shut down Dallas massage parlor after raid, prostitution arrest," 16 July 2019 The two limited partnerships that largely make up Marathon Petroleum Corp.’s midstream operations are combining in an all-stock deal, the entities said Wednesday. — Allison Prang, WSJ, "Marathon Petroleum’s Midstream Limited Partnerships to Combine," 8 May 2019 The city’s Department of Finance has long restricted cooperative apartment and condominium owners who buy under a limited liability company or limited partnership from getting a partial tax abatement. — Katie Honan, WSJ, "Apartment Buyers Who Use Corporate Name for Security Reasons May Get Tax Break," 29 Jan. 2019 Media reports earlier this year found that members of the Russian elite have used Scottish limited partnerships to launder vast amounts of money, including $20 billion in a scandal known as the Global Laundromat. — Samuel Rubenfeld, WSJ, "U.K. Launches Crackdown on Limited Partnerships," 10 Dec. 2018 Often, ownership is organized under limited partnerships and limited liability corporations, obscuring those who benefit. — Mark Collette, Joshua Fechter And Bill Lambrecht, San Antonio Express-News, "Companies earn billions to shelter immigrant children," 29 June 2018 Security tokens are backed by real assets such as an equity, shares of a limited partnership company, or commodities. — Polina Marinova, Fortune, "What Is a Security Token? Harbor's CEO Explains," 18 May 2018 Wisconsin officials struck a deal with Northwoods ATP, a limited partnership owned by a Danish pension company, that keeps the land in the company's hands but ensures access for fishing, hunting and other recreational uses. — Lee Bergquist, Milwaukee Journal Sentinel, "DNR adds more land for fishing, hunting and other public uses in $7.2 million deal," 23 May 2018 La Brea Bakery and Campanile were under one limited partnership. — Marielle Wakim, Los Angeles Magazine, "The Amazing, True Story of How Nancy Silverton Became a Living Food Legend," 26 Apr. 2018

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'limited partnership.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

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Dictionary Entries near limited partnership

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limited policy

limited service

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Last Updated

24 Jul 2019

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The first known use of limited partnership was in 1791

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More Definitions for limited partnership

limited partnership

noun

Financial Definition of limited partnership

What It Is

A limited partnership is a business formation that limits the liability of certain owners.

How It Works

A limited partnership is made up of partners. In most cases, some of the partners are general partners and others are limited partners. One or a handful of general partners manage the day-to-day operations of the business and are personally liable for the business's debts. They act as the core management team for the business and obligated to keep the limited partners informed about the condition and performance of the business. They can incur debt or obligations on behalf of the partnership and are personally liable for those debts or obligations.

Unlike general partners, the limited partners have no daily management role, cannot encumber the business and are not personally liable for the business's debts. Instead, they receive a share of the firm's profits in exchange for their capital investments, and usually the worst that can happen is that the value of their investment falls to zero. (It is important to note that limited partners who take managerial roles could be considered general partners in the eyes of the law.)

Why It Matters

Limited liability is what often attracts investors to limited partnerships. General partners, however, are personally liable for the actions of the business and the other general partners, even if those actions appear unreasonable, excessive or if they result in legal judgments against the business. General partners can lose far more than their initial investments. These management and risk burdens are two reasons general partners usually receive management fees as well as a larger percentage of the partnership's profits above a certain level. The limited partners are more like silent investors.

Source: Investing Answers

limited partnership