Starting a business is a major step for individuals in Florida and elsewhere. Even when it is a small business, it is a venture that should be done with much care and the details worked out. With regards to a partnership, there are many steps to take to ensure it is properly set up and ready to go. And by taking the time to set it up properly, partners in the business could help secure the success and longevity of the partnership.
How do you start a partnership? This business type is the simplest business structure and is formed when two or more principles are involved. Partnerships do not have any formal paperwork requirements; thus, they do not have a formal way to protect partners from liability unless they take additional steps to do so.
With regards to taxes, a business partnership doe not have corporate taxes. This means that the IRS does not have the power to tax the partnership directly; however, one should note that the government is able to tax the profits that are flowing to the individual partners as personal income.
There are three types of partnerships. This includes general, limited and joint venture. Each have advantages and disadvantages; however, with a limited partnership, there is a general partner with at least one partner being a limited partner. This makes the general partner liable for the debts that incur. This could be beneficial if issues were to arise, protecting the individuals in the limited partnership.
Like any business, much planning goes in the beginning phases. However, these plans are not flawless and issues could occur. Whether one needs help in the initial phase, when drafting a partnership agreement or to resolve disputes occurring after the business is in operations, it is vital to understand your rights. Business litigation may be a necessary step to take. This process could help with a resolution and help preserve the rights of those involved.