[nebraska]

Okay, I know this might be a stupid question but I cannot for the life of me wrap my head around this: in a limited partnership, there are general partners and limited partners….but a partner can be a limited and general partner at the same time. I don’t understand how you can be both.

REG (08/2011) - 73 (2/2012) - 72
AUD (08/2011) - 73 (1/2012) - 86
FAR (11/2011) - 79
BEC (11/2011) - 79

[jamesblunt69]

Maybe if they're a general partner and they want extra interest in the bottom line they sign up as a limited partner too? Maybe they buy the extra limited stake in the partnership and give the rights of income to their kid or a friend? Who knows? Who cares?

You seem to know the part that will allow you to get this question right on your exam.

[nebraska]

ahahah thanks for putting that into perspective, jb.

REG (08/2011) - 73 (2/2012) - 72
AUD (08/2011) - 73 (1/2012) - 86
FAR (11/2011) - 79
BEC (11/2011) - 79

[Minimorty]

A lot of the time, it is to retain control. While GPs generally make day-to-day decisions of the partnership, they are not always able to unilaterally make major decisions that effect the partnership's business (ie. Selling major assets, dissolving the entity, etc.). Quite often, these major decisions also require the approval of a majority of the limited partner interests. Accordingly, it is not uncommon to see one partner be the sole general partner and still retain 50% plus of the limited partner interests.

[nebraska]

Thank you!! That makes so much more sense!

REG (08/2011) - 73 (2/2012) - 72
AUD (08/2011) - 73 (1/2012) - 86
FAR (11/2011) - 79
BEC (11/2011) - 79

[Author]

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