Types of Limited Partnerships
Master Limited Partnerships (MLP) are the partnership units that are available for public trade and are usually listed as stock. These partnerships require a contract, called the limited partnership agreement, between limited and general partners that specify the timeline for quarterly required distributions (QRD). These are similar to dividends but are mandatory. A missed QRD constitutes an event of default. MLPs have very unique taxation situations.
Family limited partnerships are also a way for families to pool their money for investing. This may provide tax advantages and other benefits, but each family should carefully consider the disadvantages this investment vehicle may offer as well. This is a popular option when it comes to investing in real estate.