The attorneys at Fellows & Quenzer LLC help family run businesses consider the issue of whether a Family Limited Partnership is right for them. For family businesses that can benefit from a Family Limited Partnership, we guide our clients through the process in a cost effective manner. Although there can be great benefits from establishing a family limited partnership, the concept and process of creating a family limited partnership is somewhat complex. Please call our office to discuss whether this type of structure is right for your family.
Not every family business will benefit from the structure of a Family Limited Partnership. It is a structure that can aid family run businesses transfer some control of the business to future generations of the family with some beneficial estate tax consequences. In addition to being a useful tool for succession planning, a properly constructed Family Limited Partnership can substantially reduce or eliminate estate taxes related to the valuation, for IRS purposes, of a family business when the head of the family passes on. There are numerous considerations for a successfully created Family Limited Partnership including timing related to the age and health of the family member currently in control of the family business. It is key to seek qualified legal advice and guidance in forming a family limited partnership. Poorly constructed family limited partnerships can have very adverse and unintended consequences. Proper planning and consideration of the advantages as well as disadvantages of a family limited partnership are very important for family business principals when using this tool for succession planning.
Fellows & Quenzer LLC assists their clients in the transfer documentation and potential gifting when establishing a family limited partnership. We find that many family businesses in the agricultural industry can benefit from family limited partnerships. The family farm or family ranch can be a good candidate for a family limited partnership. The family business in the manufacturing or service industry can also be a good candidate for a family limited partnership.