A family limited partnership is a limited partnership that is used to hold title to family assets (for example, real estate), a family business or investments. All family members could be partners in the limited partnership or the parents could be the initial partners and, over time, gift limited partnership interests to their children (or other beneficiaries). Family limited partnerships often are used to minimize estate taxes since partnership interests can be transferred between generations (for example from parents to children) at lower tax rates than would apply if there were no limited partnership. For estate and gift tax purposes, the valuation of assets held in a family limited partnership may be discounted for valuation purposes and, therefore, less estate or gift tax may be incurred.