How to Start a Limited Liability Partnership in Nebraska | 2024 Guide

Start a Limited Liability Partnership in Nebraska

A Limited Liability Partnership (LLP) is a popular business structure offering the flexibility of a partnership while providing limited liability protection like starting an LLC in Nebraska. LLP structure is ideal for attorneys, accountants, and consultants. If you’re considering starting a Limited Liability Partnership in Nebraska, this comprehensive guide will walk you through the necessary steps, from researching and planning to ongoing compliance and reporting requirements.

Webinarcare Editorial Team will help you gain knowledge through thorough research and market study. Before starting your Nebraska LLP, all the steps in this article must guide you.

What is a Limited Liability Partnership?

Forming an LLP is like starting an LLC as well. However, there are differences in terms of it. A Limited Liability Partnership (LLP) is a type of business structure that combines elements of partnerships and corporations. It allows multiple individuals, known as partners, to jointly own and manage the business while providing limited liability protection to each partner. This means that each partner’s assets are generally protected from the debts and liabilities of the business, and they are only liable for their investment in the partnership.

LLPs are popular among professional service providers, such as lawyers, accountants, and consultants, as they allow for flexible management structures and profit-sharing arrangements. The partners in an LLP can directly manage the business, unlike forming a Corporation in Nebraska, where a board of directors typically handles the management.

Each partner’s liability is also limited to the extent of their investment, and they are not personally responsible for the negligence or misconduct of other partners. This is a key difference between an LLP and Nebraska General Partnership, where partners have unlimited liability for the partnership’s actions and other partners.

It is suggested that you speak with a legal professional before you begin setting up your limited liability partnership. They’ll understand what’s best for you and your company. To safeguard your personal assets from business debts, you can always start an LLC rather than a limited liability partnership.

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Steps in Starting a Limited Liability Partnership in Nebraska

To form a limited liability partnership in Nebraska, you must consider following the below guidelines that include research and planning, choosing an LLP name, designating a Registered Agent, filing for Certificate of Organization, drafting a partnership agreement, get an EIN, obtaining necessary licenses and permits, the opening of business bank account and maintain ongoing compliance and reporting requirements. 

Step 1: Research and Planning

Before forming an LLP in Nebraska, you must familiarize yourself with the state’s laws and regulations governing LLPs. Conduct thorough research to determine if an LLP is the right business structure for your needs, and create a detailed business plan outlining your goals, strategies, and financial projections.

Step 2: Choose an LLP Name

Selecting a unique and appropriate name for your LLP is crucial. First, check the availability of your desired LLP name with the Nebraska business registry. Ensure that your chosen name follows Nebraska naming guidelines and requirements, which typically include the use of “Limited Liability Partnership” or “LLP” in the name. You can register and reserve the name with Nebraska Secretary of State if desired.

Here are some guidelines you must follow while naming your LLP in Nebraska- 

  • Be distinguishable from other businesses registered in your state
  • Include the words “Limited Liability Partnership,” “LLP,” or a similar abbreviation.
  • Not include words that are restricted by your state
  • Ensure that your chosen name does not infringe on any existing trademarks or intellectual property rights.

However, to check the availability of your desired LLP name, you can also search the Nebraska Secretary of State business name database and Nebraska Business Name Search. If the name is available, you may choose to reserve it for a specific period of 120 days by filing a name reservation application and paying the online name reservation fee of $15 and mail name reservation fee of $15. If your LLP plans to operate under a name other than its legal name, you may also need to register a fictitious or “Doing Business As” (DBA) name. 

The DBA filing can be done by two methods, by mail and in person, which costs around $100. In addition, the DBA’s validity in Nebraska is ten years, which you can file in the Nebraska Secretary of State.

You can check out how to file a DBA in Nebraska for clearer understanding.

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Step 3: Designate a Registered Agent

In Nebraska, you’ll need to designate a Registered Agent for your LLP. The Registered Agent is responsible for receiving the partnership’s important legal and tax documents. Choose a qualified individual or Nebraska Registered Agent Services to serve as your LLP’s Registered Agent, ensuring that they meet Nebraska requirements.

However, If you plan to become a Registered Agent of your own LLP, follow the steps below. Also, this applies a guideline in hiring your registered agent.

  • Research the requirements in the state where you want to offer your service. Each state has specific criteria, such as having a physical address and being available during normal business hours.
  • Obtain a physical address in the state(s) if needed.
  • Be familiar with the rules, regulations, and compliance requirements for businesses in your state.
  • Create a business plan outlining your services, pricing, and marketing strategy.
  • Register your business entity, such as an LLP, if required.

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Step 4: File a Certificate of Limited Liability Partnership

To officially form your LLP, you must file a Certificate of Limited Liability Partnership with the Nebraska Secretary of State. Obtain the necessary forms and provide the required information, such as the LLP name, principal office address, registered agent’s name and address, names and addresses of partners, and management structure. Pay the required filing fee and submit the completed forms to the Nebraska Secretary of State’s office.

Step 5: Draft a Partnership Agreement

A well-crafted partnership agreement is essential for governing your LLP and protecting the interests of its partners. This document should cover crucial provisions such as roles and responsibilities of partners, profit and loss sharing, decision-making processes, partner admission and withdrawal, and dispute resolution. Consider having the partnership agreement reviewed by an attorney to ensure its completeness and compliance with Nebraska laws.

A partnership agreement should include the following:

  • Business name
  • Description of the business
  • Contact information of the business and its owners

Ownership of all business partners, decision-making, capital contribution, profits and distribution, death and disability, and withdrawal and addition of partners is one of the key factors to consider when forming or creating a partnership agreement. In this way, all business partners will understand what this is all about and how to proceed if the mentioned scenarios happen. 

Without a partnership agreement, your company will often be subject to the general partnership default laws of Nebraska. The default laws in Nebraska might not be appropriate for your requirements.

Step 6: Get an EIN

Your LLP must obtain Nebraska Employer Identification Number (EIN) from the Internal Revenue Service (IRS). The application of an EIN can be through the following:

  • Apply Online- The online EIN application is the preferred method for customers to apply for and obtain an EIN.
  • Apply by Fax- Taxpayers can fax the completed Form SS-4 application to the appropriate fax number), after ensuring that Form SS-4 contains all of the required information.
  • Apply by Mail- The EIN application Form SS-4 can be filed via mail. The processing time frame to receive the mail is four weeks.
  • Apply by Telephone-International Applicants – International applicants may call 267-941-1099 (not a toll-free number) from 6 a.m. to 11 p.m. (Eastern Time) Monday through Friday to obtain their EIN.

After you have your EIN, you can benefit in several ways. It will give your LLP the absolute advantage necessary to operate at full capacity without encountering legal or judicial issues.

Step 7: Obtain the Necessary Licenses and Permits

Depending on your specific industry, you may need to obtain Nebraska Business Licenses and permits to operate your LLP. Research your business’s licensing and permit requirements and apply for them accordingly.

You can check out the United States Business License & Licensing Fee Resources for more information about the costs in Nebraska.

Step 8: Open a Business Bank Account and Obtain Insurance

Maintaining clear financial records is crucial for any business, so open a separate bank account for your Nebraska LLP. Additionally, obtain the necessary Nebraska Business Insurance, such as general liability insurance, professional liability insurance (if applicable), and workers’ compensation insurance (if you have employees). 

Check the Best Bank for Small Businesses in Nebraska to open a bank account.

Step 9: Maintain Compliance and Reporting Requirements

Stay informed about and comply with relevant laws and regulations to keep your LLP in good standing. File Biennial Reports with the Nebraska Secretary of State (if required), maintain accurate financial and operational records, and file and pay required taxes at the federal, Nebraska, and local levels.

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Advantages of Forming a Limited Liability Partnership in Nebraska

While the specific advantages of forming an LLP in Nebraska can vary depending on the state’s unique laws and regulations, several public benefits associated with LLPs often apply across jurisdictions. Here are some advantages to consider when forming an LLP in Nebraska:

  • Limited Liability Protection: One of the main benefits of an LLP is its limited liability protection to its partners. This means that each partner’s assets are generally protected from the debts and liabilities of the business, and they are only liable for their investment in the partnership.
  • Pass-through Taxation: An LLP typically enjoys pass-through taxation, which means that the profits and losses of the business are passed through to the partners, who report them on their personal income tax returns. This avoids the double taxation often associated with corporations.
  • Flexible Management Structure: Unlike corporations requiring a board of directors, LLPs allow for a more flexible management structure. Partners in an LLP can directly manage the business and make decisions without needing a formal board.
  • Profit-sharing Flexibility: The partnership agreement can outline the distribution of profits and losses among partners, allowing for a customized profit-sharing arrangement based on the partners’ preferences and contributions.
  • Easier Formation and Compliance: Forming an LLP is generally less complicated and expensive than forming a corporation. Ongoing compliance requirements may also be less burdensome than other business entities, depending on the specific laws and regulations in Nebraska.
  • Professional Credibility: Forming an LLP can enhance your business’s professional credibility, as it demonstrates a commitment to a formal business structure and can offer reassurance to clients, customers, and potential investors.

Bear in mind that the advantages of forming an LLP in Nebraska may vary based on the specific laws and regulations governing LLPs. Researching the applicable laws and consulting with legal or financial advisors is essential to fully understand the benefits and requirements of forming an LLP in Nebraska.

Cost of Forming an LLP in Nebraska

The cost of forming an LLP in Nebraska may vary depending on the required filing fees and any additional services you may need. The filing fee for a Certificate of Limited Liability Partnership typically ranges from $50 to $200, depending on the state.

Can I Form an LLP in Other States?

You can form an LLP (Limited Liability Partnership) in other states. To form an LLP in a different state, you must follow that state’s specific registration requirements and filing procedures. This usually involves filing an application or certificate of registration, paying a registration fee, and obtaining any necessary permits or licenses.

Additionally, you may need to register your LLP as Nebraska Foreign LLC if you plan to conduct business in multiple states. It is advisable to consult with an attorney or a business consultant familiar with the laws and regulations of the state where you plan to form your LLP.

Can an LLP Need to Have One Owner?

An LLP (Limited Liability Partnership) cannot have just one owner. By definition, an LLP is a partnership, which means it requires at least two partners to be formed. If you want a business structure with limited liability protection and only one owner, you may consider forming a Single-Member LLC in Nebraska instead. An LLC can have one or more owners, known as members, and offers limited liability protection and pass-through taxation. The requirements for forming an LLC will vary by state, so consult your state’s laws and regulations.

FAQs

What is a limited liability partnership in Nebraska?
A limited liability partnership in Nebraska is a type of business entity where all partners have limited liability protection.
How many partners are required to form an LLP in Nebraska?
Two or more partners are required to form an LLP in Nebraska.
How is an LLP taxed in Nebraska?
LLPs are taxed as pass-through entities in Nebraska, meaning that the profits and losses of the business are passed on to the partners to report on their individual tax returns.
How can I register my LLP in Nebraska?
You can register your LLP in Nebraska by filing a Certificate of Limited Liability Partnership with the Nebraska Secretary of State.
What are the fees for registering an LLP in Nebraska?
The filing fee for registering an LLP in Nebraska is $100.
How long does it take to register an LLP in Nebraska?
It generally takes 1-2 weeks to register an LLP in Nebraska.
Can I establish an LLP in Nebraska without a physical office?
Yes, it is possible to establish an LLP in Nebraska without a physical office.
What is the liability protection for partners in an LLP in Nebraska?
In an LLP in Nebraska, partners have limited liability protection against business debts and legal claims.
Are there any naming requirements for an LLP in Nebraska?
Yes, the name of the LLP must include the words “Limited Liability Partnership” or “LLP” in the name.
Can an LLP be a professional entity in Nebraska?
Yes, a limited liability partnership can be a professional entity in Nebraska.
Are there any ongoing filing requirements for an LLP in Nebraska?
Yes, LLPs in Nebraska are required to file an Annual Report and pay a fee of $10 to maintain good standing.
Can I change the business structure of my LLP in Nebraska to a different entity type?
Yes, it is possible to change the business structure of an LLP in Nebraska to a different entity type.
Can I dissolve my LLP in Nebraska?
Yes, you can dissolve your LLP in Nebraska by filing a Certificate of Dissolution with the Secretary of State.
What happens to the assets of an LLP in Nebraska if the partnership is dissolved?
The assets of an LLP in Nebraska are distributed to the partners according to their ownership interests after all debts and liabilities are paid off.
Can a non-resident be a partner in an LLP in Nebraska?
Yes, a non-resident can be a partner in an LLP in Nebraska.
Can a business entity be a partner in an LLP in Nebraska?
Yes, a business entity can be a partner in an LLP in Nebraska.
Can a limited partner manage an LLP in Nebraska?
No, limited partners in an LLP in Nebraska cannot participate in management.
Can an LLP in Nebraska have an unlimited number of partners?
Yes, an LLP in Nebraska can have an unlimited number of partners.
Can an LLP in Nebraska be formed for a specific project or term?
Yes, an LLP in Nebraska can be formed for a specific project or term.
Can I deduct losses from my LLP in Nebraska on my taxes?
Yes, partners in an LLP in Nebraska can deduct their share of losses on their individual tax returns.
Can an LLP in Nebraska own property?
Yes, an LLP in Nebraska can own property.
Can an LLP in Nebraska be sued?
Yes, an LLP in Nebraska can be sued.
Can I be held personally responsible for the debts of my LLP in Nebraska?
No, partners in an LLP in Nebraska are not responsible for the debts of the partnership.
Are partnerships still allowed in Nebraska?
Yes, partnerships are still allowed in Nebraska.
What is the difference between an LLP and an LLC in Nebraska?
The main difference between an LLP and an LLC in Nebraska is that in an LLP, all partners have limited liability protection, while in an LLC, only the owners (members) have limited liability protection.
Can an LLP in Nebraska have employees?
Yes, an LLP in Nebraska can have employees.
Can I convert my LLC to an LLP in Nebraska?
Yes, it is possible to convert an LLC to an LLP in Nebraska by filing the necessary paperwork with the Secretary of State.
Can I convert my partnership to an LLP in Nebraska?
Yes, it is possible to convert a partnership to an LLP in Nebraska by filing the necessary paperwork with the Secretary of State.
How do I form a limited liability partnership in Nebraska?
To form a limited liability partnership in Nebraska, you must file a certificate of limited liability partnership with the Secretary of State’s office.
What are the minimum requirements for forming a limited liability partnership in Nebraska?
The minimum requirements for forming a limited liability partnership in Nebraska are two or more partners and the filing of a certificate of limited liability partnership.
Is there a fee to file a certificate of limited liability partnership in Nebraska?
Yes, there is a fee to file a certificate of limited liability partnership in Nebraska. The fee varies depending on the type of business entity being formed.
What do I need to include in a certificate of limited liability partnership in Nebraska?
A certificate of limited liability partnership in Nebraska must include the name of the partnership, the address of the partnership’s principal office, the name and address of each partner, and the signature of at least one partner.
Can individuals from out of state form a limited liability partnership in Nebraska?
Yes, individuals from out of state can form a limited liability partnership in Nebraska as long as they meet the state’s minimum requirements.
Do limited liability partnerships need to have bylaws in Nebraska?
Limited liability partnerships in Nebraska are not required to have bylaws, but they may choose to do so to help with the governance of the partnership.
Are limited liability partnerships in Nebraska required to have a registered agent?
Yes, limited liability partnerships in Nebraska are required to have a registered agent.
Can a partner in a limited liability partnership in Nebraska run the day-to-day operations of the business?
Yes, partners in a limited liability partnership in Nebraska can run the day-to-day operations of the business, but they are not required to do so.
Can a limited liability partnership in Nebraska have multiple locations?
Yes, a limited liability partnership in Nebraska can have multiple locations.
Do limited liability partnerships in Nebraska need to file annual reports?
Yes, limited liability partnerships in Nebraska must file annual reports with the Secretary of State’s office.
What is the fee for filing an annual report for a limited liability partnership in Nebraska?
The fee for filing an annual report for a limited liability partnership in Nebraska is $10.
How often do limited liability partnerships in Nebraska need to file annual reports?
Limited liability partnerships in Nebraska need to file annual reports every year.
Can limited liability partnerships in Nebraska change their name?
Yes, limited liability partnerships in Nebraska can change their name by filing an amendment with the Secretary of State’s office.
Is there a fee to file an amendment for a limited liability partnership in Nebraska?
Yes, there is a fee to file an amendment for a limited liability partnership in Nebraska.
Can a limited liability partnership in Nebraska be taxed as an S corporation?
No, limited liability partnerships in Nebraska cannot be taxed as S corporations.
Are there any tax advantages to forming a limited liability partnership in Nebraska?
There may be tax advantages to forming a limited liability partnership in Nebraska, but it is recommended to consult with a tax professional to understand the specific advantages.
Can limited liability partnerships in Nebraska have employees?
Yes, limited liability partnerships in Nebraska can have employees.
Are partners in limited liability partnerships in Nebraska liable for the actions of other partners?
Partners in a limited liability partnership in Nebraska are generally not liable for the actions of other partners.
Can partners in a limited liability partnership in Nebraska sue the partnership?
Yes, partners in a limited liability partnership in Nebraska can sue the partnership.
Can creditors sue the partners in a limited liability partnership in Nebraska?
Creditors of a limited liability partnership in Nebraska can only sue the partnership, not the individual partners.
Do limited liability partnerships in Nebraska need a business license?
Limited liability partnerships in Nebraska may need to obtain a business license depending on the city and county where they are doing business.
Are there any annual franchise taxes for limited liability partnerships in Nebraska?
No, there are no annual franchise taxes for limited liability partnerships in Nebraska.
Can a limited liability partnership in Nebraska be owned by just one person?
No, a limited liability partnership in Nebraska must have at least two partners.
Can a limited liability partnership in Nebraska be converted to a different type of business entity?
Yes, a limited liability partnership in Nebraska can be converted to a different type of business entity.
Do limited liability partnerships in Nebraska have limited legal liability protections?
Yes, partners in a limited liability partnership in Nebraska have limited liability protections.
Can partners in a limited liability partnership in Nebraska be held personally responsible for the partnership’s debts?
Partners in a limited liability partnership in Nebraska are not usually held personally responsible for the partnership’s debts.
Can a limited liability partnership in Nebraska operate under a different name than the partners’ legal names?
Yes, a limited liability partnership in Nebraska can operate under a different name, known as a fictitious name or “doing business as” name.

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Conclusion

Starting an LLP in Nebraska may seem daunting, but you can successfully establish and run your business with thorough research, planning, and compliance with legal requirements. Feel free to seek professional assistance from legal or financial advisors when needed to ensure your Limited Liability Partnership’s smooth operation and growth in Nebraska.

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