Differences between LLC and LLP



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    Michael Ermann

    LLC can be an individual or a partnership where all the owners are OPERATING the business (like here)…LLP is structured with TWO TIERS of ownership, one operating the business and one (with less legal exposure) for silent partners who are INVESTORS in the firm. So if your architecture colleagues and you join together to create and run a firm and you are negligent such that a preschool collapses you (as an LLC partnership) have more legal exposure than if you as a successful filmmaker invests in your grandson’s architecture firm as a silent partner (LLP) and the preschool (which you had nothing to do with the design of) collapses.—Michael Ermann, Amber Book creator

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    Xianghui Kong Kong

     Thank you so much, Michael!

    Love the example you give, which is so clear and easily-understood. 

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