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House adopts substitute HB 5 to create limited liability partnership; lawmakers debate liability and tax implications
Summary
Substitute HB 5, introduced by Representative John L. Valentine, would add a limited liability partnership form modeled on the Delaware Act. Supporters said it helps small business; colleagues raised questions about liability exposure, bank treatment, interstate recognition and tax consequences. The House passed the substitute 72‑1 and referred it to the Senate.
Representative John L. Valentine introduced Substitute House Bill 5 to create a limited liability partnership (LLP) form intended to give small businesses the flexibility of a partnership while limiting some partner liabilities.
Valentine framed the bill as filling a gap between general partnerships and limited liability companies, saying the LLP lets partners "get some of those advantages without having to go through all of the paperwork…
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