LLPs

• Typically, an LLP is used for lawyers and accountants who want to go into partnerships. In California and New York only professionals can create an LLP.
  
  

LLCs

• An LLC can be started with just one member, making it more ideal for a small business owner.
  
  

Liability Protection

• The biggest difference between an LLP and an LLC is the liability protection. With both, members have liability protection. However, that protection is limited for LLPs and varies from state to state.
  
  

Taxes

• An LLC can elect to be taxed as a sole proprietor, partnership, S corporation or C corporation, offering more tax advantages than an LLP.
  
  

State Restrictions

• State tax laws vary for LLCs. If you will be operating across state lines, check the laws of the states of the companies you do business with.