Corporate Transactions
Partnership
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A partnership is a flexible form of business in which all of the partners will decide the structure of the organization and the distribution of profits and losses.
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A formal, written partnership agreement is highly advisable in case of a future dispute among its partners.
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A separate bank account should be established to run the business operations.
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The profits and losses "flow down" from the partnership to the individual partners through each of their Schedule K-1’s. Each partner is responsible for paying taxes on his or her distributive share.
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In a general partnership, each partner is personally liable for all business debts and lawsuits. A general partnership exists as long as the partners agree it will and as long as all of the general partners remain in the partnership.
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