Florida Partnership Agreement: FRUPA, LLLP Availability, Sunbiz Filing

The Florida Entity Choice

Florida’s $1,000 LP filing fee is one of the highest in the country (Delaware charges $200, Texas charges $750), but the annual $500 report fee is also relatively high. The LLP filing at $25 plus $25 annually is comparatively cheap. Most Florida operating businesses use LLCs (formed under F.S. Ch. 605, filing fee $125, annual report $138.75), which are administratively simpler than LPs.

Sunbiz Filings and Calendar

Florida partnerships and LLCs file through the Sunbiz portal operated by the Division of Corporations. The Sunbiz annual-report deadline is the single most important date for Florida entities: 1 May each year. Missing the deadline triggers a $400 late fee. Failing to file by the third Friday of September results in administrative dissolution, which suspends the entity’s capacity and triggers loss of liability protection during the dissolution period.

The partnership agreement should specifically authorise the managing partner to file Sunbiz reports, designate a registered agent (Sunbiz requires a registered agent with a Florida street address), and pay the annual fees from partnership funds. Calendar reminders should be set well in advance of the 1 May deadline.

Reinstatement after administrative dissolution is possible by filing a Reinstatement form, paying back annual report fees, paying the reinstatement fee ($600 for LPs and LLLPs), and clearing any other delinquent filings. Reinstatement restores the entity retroactively, but contracts entered into during the dissolution period may be challenged as ultra vires; partners may face personal liability for transactions during the dissolution window. Stay current on filings.

The Florida LLLP: A Real Option

Florida was one of the early adopters of LLLP-enabling legislation and remains one of the most LLLP-friendly states. Under F.S. §620.1102(8), any LP formed after 1 January 2007 may elect LLLP status by including LLLP designation in its certificate of limited partnership and name. Elections by pre-2007 LPs are also permitted by filing an amendment.

The LLLP shield extends to the general partner’s personal liability for partnership obligations. This eliminates the historic need to interpose an LLC general partner in family limited partnerships and other LP structures. For Florida estate planning, the LLLP is the cleaner answer than the GP-LLC + LP structure used elsewhere.

A non-Florida LLLP doing business in Florida must register as a foreign LLLP (Form CR2E093, $1,000 filing fee). Florida recognises foreign LLLP status under the internal-affairs doctrine subject to registration; the foreign LLLP retains its home-state LLLP shield in Florida operations.

The No-Income-Tax Tax Picture

Florida’s constitutional ban on a state personal income tax (Florida Constitution Art. VII §5(a)) is the state’s defining tax characteristic. Partners domiciled in Florida pay no Florida state income tax on their distributive shares. Federal tax still applies; partners who are residents of other states still owe their home-state income tax on K-1 amounts.

The Florida Corporate Income Tax (5.5% on net income, F.S. Ch. 220) applies only to entities taxed as corporations at the federal level. Entities taxed as partnerships (including LPs, LLPs, LLLPs, and pass-through LLCs) are not subject to Florida Corporate Income Tax.

Local taxes are minimal for partnerships. Most Florida counties impose a local business tax (called the “occupational license” tax in older usage), typically $50-$200 annually depending on business type and gross receipts. Some cities impose additional local business taxes. Tangible personal property tax applies to business assets at typically 1.5-2.5% of assessed value, with a $25,000 exemption per F.S. §196.183.

Sales and use tax (6% state plus discretionary county surtax up to 2.5%) applies to taxable transactions and is collected by the partnership but ultimately borne by customers, not partners.

Florida Non-Compete: §542.335 Detail

F.S. §542.335 codifies and standardises Florida non-compete enforcement in unusually favourable terms for parties seeking enforcement. The statute creates statutory presumptions of reasonableness for specific durations:

• 6 months: presumed reasonable for restrictions on former employees not involving trade secrets;
• 2 years: presumed unreasonable for the same;
• 1 year: presumed reasonable for restrictions on former employees in possession of trade secrets;
• 5 years: presumed unreasonable for trade-secret restrictions;
• 3 years: presumed reasonable in connection with sale of a business or partnership interest;
• 7 years: presumed unreasonable for sale-of-business restrictions.

The statute also requires courts to construe non-competes liberally in favour of providing reasonable protection to all legitimate business interests, lists specific legitimate interests (including trade secrets, customer relationships, goodwill, specialized training), and prohibits courts from refusing enforcement on the ground that the restraint is overbroad if it can be reformed. This combination makes Florida one of the most non-compete-friendly states in the country, particularly compared to California (which voids most non-competes).

For Florida partnerships, the §542.335 framework supports drafting longer durations than would be enforceable in other states. A 3-year post-buyout non-compete is presumed reasonable under the statute; the same restriction would face skepticism in many states.

Sample Florida-Specific Provisions

Authoritative Sources

• F.S. Ch. 620 Pt. II §§620.81001-620.9902 (Florida Revised Uniform Partnership Act). Florida Legislature.
• F.S. Ch. 620 Pt. I §§620.1101-620.2205 (Florida Revised Uniform Limited Partnership Act).
• F.S. §620.1102(8) (LLLP election).
• F.S. §542.335 (Florida non-compete statute).
• F.S. §620.9001 et seq. (Florida LLP provisions).
• Florida Constitution Art. VII §5(a) (no personal income tax).
• Sunbiz, Florida Division of Corporations. Sunbiz.
• Florida Department of Revenue. Florida DOR.

FAQ