What type of business entity is an LLP considered to be?

An LLP, or Limited Liability Partnership, is considered a hybrid entity because it combines elements of both partnerships and corporations. This structure allows partners to have limited liability, protecting their personal assets from the debts and obligations of the business, similar to a corporation. At the same time, it retains the flexibility of a partnership, with partners being able to manage the business directly and share profits as they see fit.

The hybrid nature of an LLP also permits it to be taxed as a partnership, avoiding the double taxation that typically applies to corporations. This blend of features is what distinguishes LLPs from purely non-profit organizations, non-corporate organizations, and governmental entities. Non-profits are primarily focused on furthering a social cause without profit intent, while non-corporate organizations do not offer limited liability features. Governmental entities operate under a different structure altogether focused on public service, which does not apply to the LLP framework.