The Revised Uniform Limited Partnership Act

The Revised Uniform Limited Partnership Act ("RULPA") is a statute which governs the law of limited partnerships. The Act is important because of the highly effective asset protection offered by limited partnerships.

Under the RULPA, a limited partnership has two types of partners, general and limited. There must be at least one of each type of partner. Both types of partners own a percentage of the partnership, based on the contribution of that partner. General partners have management control over the partnership and can be held personally liable for any claims against the partnership. Limited partners, on the other hand, do not actively manage the partnership and enjoy much more limited liability for partnership activities. Limited partners are liable for the partnership's debts only to the extent of their investment in the partnership.

RULPA offers a method of structuring a business that optimizes asset protection. However, the benefits of RULPA are lost when the law is not followed properly. For example, a limited partner who assumes management control over the partnership will no longer enjoy limited liability. Retaining an experienced asset protection attorney, well-versed in RULPA, will ensure compliance with the law, in order to achieve the greatest amount of asset protection.

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