A general partnership is the simplest form of business alliance that you can enter into. It is less expensive and more manageable than forming a corporation or becoming a limited liability company (LLC). But you do have to know what to expect from your business partner and what he will expect from you.
The basic rule is to be sure that you can trust the person whom you are considering to be your partner. After that you must realize that you’ll be putting your personal assets at stake by entering into a general business partnership. In other words, if the profits from your business aren’t sufficient to cover the debts it incurs you will be held personally responsible to repay those debts.
Don’t commit to a partnership without first sitting down with your partner to be and discussing a few fundamentals, so that there will be no misunderstandings later. If you aren’t comfortable doing this or if after the discussion you feel that you and your partner are on an entirely different page when it comes to the goals for your business then you might want to reconsider entering into the relationship.
You may have the skills or training that makes you better in one phase of the business than your partner, and visa versa. Case in point, one of you may shine at being the front man while the other works better behind the scenes. This could be seen as an asset on a list of pros and cons as long as you can work together and agree on the basic objectives.
Ask each other key questions about the approach you each intend to take toward the business. Find out where you are in agreement and where there might be some room for debate. It might be beneficial to get an honest opinion from an independent source. If you and your prospective partner have known each other for some time you no doubt have mutual friends and may even be on a personal basis with respective family members. Nothing is lost by getting a fresh perspective.
Once you decide to go ahead with your partnership plans, consult with an attorney about any legal aspects that may be involved in the transaction. Call Parker Lawyers @ 303-841-9525.