| In a Limited Partnership, it provides a personal liability protection for limited partners. This is important because it can help cover the costs of damages or injuries you are held liable for as well as legal expenses if you are sued. | Limited partnerships are much more restricted in management decisions and are mostly responsible for investment-related duties, which can lead to frustration or dissatisfaction. |
| Since limited partnerships are considered to be risk-free as well as being actively involved, they often have high amounts of funding from investors. This allows for a greater investment in projects, expansion, and resources. | In a limited partnership, general partnerships are not considered separate business entities, meaning that the general partners bear the responsibility of all businesses’ debt and obligations. |
| A limited partnership also contains an informal business structure. This type of structure offers a lot of flexibility as well as giving employees the power to collaborate, take initiative, and make decisions. Businesses that fall under this also tend to be more responsive to changes in structure and situations that can affect its members. | Since general partners usually have unlimited liability, creditors who are owed money can come after general partners to pay business debts, which is a downside compared to other business structures like LLCs that offer all owners limited liability. |