What are limited liability partnerships (LLPs) characterized by?

Limited liability partnerships (LLPs) are characterized by having features of both partnerships and corporations. This hybrid structure allows partners to enjoy the tax benefits of a partnership while providing them with limited liability protection akin to that of a corporation. Specifically, in an LLP, partners are not personally liable for the debts and liabilities of the partnership, which shields their personal assets from business risks, a trait that corporations typically offer.

This flexibility attracts many professionals, such as lawyers and accountants, who prefer the collaborative aspect of a partnership while also wanting the security that comes from limited liability. The other options, such as being only a type of corporation, lacking flexibility in ownership, or being solely designed for family businesses, do not accurately reflect the nature of LLPs. LLPs can have diverse ownership structures and are not restricted to family-oriented enterprises, thus emphasizing their versatility in the business environment.