Part One

Make certain that a separate account is established and constantly maintained in the name of the Family Limited Partnership and that the assets in such an account remain separate from nonentity account (such as the general partners’ personal or trust accounts).

The general partner of the Family Limited Partnership should endorse all transactions involving the partnership. No property should be added to an FLP without first looking for advice from competent legal counsel and completing a Contribution Agreement documenting who made the contribution, what is its cost basis and its current fair market value.

Establish and maintain a separate capital account for each Family Limited Partnership member. Consult an accountant to establish maintain such accounts.

Always conduct annual meetings on behalf of the partnership and discuss partnership transactions such as asset purchases and sales, leases, etc. These annual meetings should be documented in minutes prepared and signed by the general partners.

Make sure that accurate records of Family Limited Partnership transactions are maintained as they occur and prepare an annual account of all Family Limited Partnership transactions for the given year to be retained with FLP records. Keep a current schedule of all partners and the number of limited and general units owned by each.

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