Partnerships exist when two or more people agree to engage in business for profit. Partnerships can be formed to engage in a number of different ventures, and generally have low start-up costs and do not require many formalities. There a several types of partnerships, each with their own benefits and drawbacks. Two of the most popular are detailed below.
In a general partnership, each partner equally owns the business and has full authority to act as an agent of the business, meaning that he or she may make business decisions on behalf of the partnership. There are no formal filing requirements to form a general partnership in the state of California. On the contrary, general partnerships can be formed through an oral or written agreement or simply by the conduct of the parties, if a court determines that an implied partnerships. Importantly, each partner is personally liable for all business debts associated with the partnership. Continue Reading