Question

5. Jake and Josh are have a business structured as a partnership located in Livingston, NJ. They are content with their current tax situation but are uncomfortable with the unlimited liability to which they are each subjected. Which form of business entity should they consider to replace their general partnership assuming they wish to remain the only two owners of their business? Whichever organization they select, they wish to be treated equally.

Answer 1

Limited liability partnership is a form of business in which the liability of the partners in the partnership will be Limited and they will be having the ownership of the firm as well.

Their primary choice should be limited liability partnership because it will be limiting their liabilities and they will still be having the same tax structure

They should not be selecting the corporation structure because it will be leading to double taxation and sharing of the ownership.