Partnership Act Contents

For federal and state tax purposes, a partnership is not a taxable entity. Partnership income is taxable to shareholders in proportion to their share of the corporation`s profits. Partner`s business transactions with the partnership A partnership is a for-profit business organization consisting of two or more people. State laws regulate partnerships. According to various state laws, “persons” can include individuals, groups of individuals, businesses, and businesses. As a result, partnerships differ in complexity. A partnership relationship is usually the result of an explicit or implicit contract. To determine whether a partnership exists, the courts consider: (1) the intent of the parties, (2) the division of profits and losses, (3) the joint management and control of business transactions, (4) the capital investment of each partner, and (5) the co-ownership of the property. For more information on partnerships, see this Article from fordham Law Review: With Limited Liability for All: Why Not a Partnership Company?, this article from the Journal of Law, Economics & Organization, and this article from Fordham Law Review: The New Uniform Limited Partnership Act: A Critique.

Federal law plays a minimal role in partnership law, except in the context of a diversity action or in cases where a partnership agreement contains a choice of law provision that determines the application of federal law. Federal law also regulates the existence of a partnership for federal tax purposes. Modification of the certificate of the limited partnership Each partner directly shares the profits of the organization and shares control of the business operations. This participation in profits has the consequence that the shareholders are jointly and severally liable for the debts of the company. The establishment, organization and dissolution of partnerships shall be governed by the law of the State. However, many States have adopted the Uniform Law on Partnerships. Mergers and consolidations in which other companies are involved Legal appointment of the Secretary of State as a representative for the service of the procedure Payment of interest of deviant limited partners Execution, modification or cancellation by legal action Person who considers himself to be a limited partner. . . .