What does limited partnership mean on the CPA exam?
Limited partnership. A partnership with at least one general partner who manages and is personally liable, and limited partners who invest without personal liability or control.
Defined against RULPA.
Which CPA exam sections use limited partnership?
Limited partnership appears in 6 CPA exam sections: AUD, BAR, FAR, ISC, REG, TCP.
Related terms
- partnership liabilities: Debt of the partnership, allocated among the partners and added to their outside basis.
- qualified nonrecourse financing: Borrowing secured by real property from a commercial lender, where nobody is personally liable.
- partnership interest: A partner's stake in the partnership itself, distinct from any interest in its underlying assets.
- guaranteed payment: A payment to a partner for services or the use of capital, determined without regard to partnership income.
- piercing the corporate veil: A court setting aside limited liability and reaching the owners personally, typically where the entity was undercapitalized, its formalities ignored, or its funds mixed with the owner's.
- at-risk amount: How much a taxpayer could actually lose in an activity: cash and property contributed, plus debt they are personally liable for.