How are partnerships taxed?
A partnership does not pay any income taxes. Instead, partnership income "passes through" the business to the partner. Each person then reports his or her share of business profits or losses on an individual federal tax return.
What is a partnership and how do I create one?
A partnership is a business owned by two or more people. There are three different types of business partnerships:

  1. General partnership
  2. Limited partnership
  3. Limited liability partnership
General partnerships require filing a DBA/Business Name statement with the state or county. Limited partnerships and limited liability partnerships require filing articles with the Secretary of State or the appropriate state agency.
Is a written partnership agreement required for every partnership?
No. However, it is usually a good decision for partners to work out the details of the partnership and create a written agreement. If you do not, the state's rules regarding partnerships will govern your partnership.

LegalZoom can help you create a framework partnership agreement to save you time and money that you might otherwise spend on lawyer's fees.
What are the differences between a partnership and a limited liability company (LLC)?

The biggest difference between a general or limited partnership and an LLC is that the general partners of any partnership are personally liable for any business debts. This means creditors can go after the partners' personal assets while members of an LLC are not personally liable.

How are partnerships taxed?
A partnership does not pay any income taxes, although it may be required to file a tax return. Instead, partnership income "passes through" the business to the partners. Each partner then reports his or her share of business profits or losses on an individual federal tax return.
What are the differences between a partnership and a limited liability company LLC?
The biggest difference between a general or limited partnership and an LLC is that the general partners of any partnership are personally liable for any business debts. This means creditors can go after the partners' personal assets while members of an LLC are not personally liable.
What is a partnership and how do I create one?
A partnership is a business owned by two or more people. There are three different types of business partnerships:
  1. General partnership
  2. Limited partnership
  3. Limited liability partnership

General partnerships may require filing a DBA/Business Name statement with the state or county if the business name does not include the surnames of the partners. Forming either a limited partnership or a limited liability partnership requires filing articles with the Secretary of State or the appropriate state agency.

Is a written partnership agreement required for every partnership?
No. However, it is usually a good decision for partners to work out the details of the partnership and create a written agreement. If you do not, the state's default rules regarding partnerships will govern your partnership.

LegalZoom can help you create a framework partnership agreement to save you time and money you might otherwise spend on lawyer's fees.

What is "breach" of agreement?

A breach of agreement means that one party did not live up to their end of the bargain. If any of the terms or agreements are not met, this could be considered to be a violation of the agreement, or a "breach."

What is "consideration"?

For the agreement to be valid, the agreement must include some form of consideration. This means the agreeing parties must exchange "something of value" from the agreement.

How can I enforce an agreement?

The most common way to resolve business agreement disputes and enforce agreements is through the court system. However, courts and lawsuits are not the only option for businesses. Mediation and arbitration are also solutions.

Does an agreement have to be notarized?

Usually not. A notary public (or notary) provides an acknowledgment that the signature appearing on the document is that of the person whose signature it purports to be. There is a requirement that some documents be notarized, such as a real property deed. Unless specifically required by state or municipal law, a written agreement does not have to be acknowledged before a notary public.

What is "offer" and "acceptance"?

Offer and acceptance are the beginning part to any agreement. When one party makes an offer and the other party accepts the offer, an agreement has been reached. At this point, the only other thing needed to become a legally enforceable agreement is "consideration."

What is a "performance" agreement?

A performance agreement is an agreement to perform a certain task. Music bands or entertainers often use performance agreements to sign deals to perform at certain venues or theaters.

What types of agreements must be in writing?

There are certain types of agreements that must be in writing to be enforceable. Typically, any agreement that is worth more than $500 must be in writing. Also, sales of real estate and agreements that take longer than 1 year are required to be in writing.