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Partnerships
A partnership is for businesses that are owned and operated
by several people. Partnerships do not have to pay income
taxes on earnings, instead profits and loses are "passed
through" to the partners. The individual partners then
claim any profits or losses from the partnership on their
personal income tax forms. These amounts are generally apportioned
based upon the individual's share of the partnership. Each
partner can act on behalf of the partnership.
The individual partners are personally liable for all of
the debts incurred on behalf of the partnership- including
loans and legal claims.
There are two main types of partnerships:
General partnerships
In a general partnership, all partners are actively involved
in running the partnership. All partners manage the partnership,
and are responsible for the obligations of the partnership
(including debts and other liabilities).
Unless specified otherwise, a general partnership ends
upon the death or withdrawal of one partner.
Limited partnerships
In a limited partnership, there are both general partners
and limited partners. The general partners manage and operate
the business, assuming liability for the debts and liabilities
of the partnership. Limited partners are investors only.
Limited partners are only liable to the amount of their
contribution to the partnership, and have no control over
the operation of the business.
The partnership continues after the death or withdrawal
of a limited partner. Unless specified otherwise, a limited
partnership ends upon the death or withdrawal of one general
partner.
Additional Business Planning Resources
We will help you determine the appropriate business entity
in order to best serve you and your organization. Some of
the factors to consider when selecting an entity include:
taxation; personal liability; ability to raise additional
capital; growth expectations; and, managment of the organization.
Some of the different type of entities to be considered are
as follows:
Contact us today for a free consultation to discuss your
business planning needs. Our offices are located in central
San Diego, California. We represent clients throughout the
United States.
To contact us, fill out the form on this page or call us
at 858-350-3124 (San Diego) or toll free at 800-361-1961.
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