FLPs are complicated structures, and we want you to implement your FLPs properly. Carelessness and failure to abide by formalities may lead to a creditor undoing, or the IRS challenging, many of the benefits of an FLP. Thus, we present this reminder to clients who have established FLPs.
Keep accurate records of transactions, investments, sales of property, etc. Keep these records separately from your personal records. Keep records of distributions from the FLP to the partners. The simplest repository of a partnership’s financial records is the partnership’s bank account check register. It is often most convenient to keep all records in the FLP binder.Continue Reading