A General Partnership is an association of two or more persons to carry on a business as co-owners, whether or not the persons intend to form a partnership. There is no form required to be filed with the Secretary of State’s office for a General Partnership to come into being. A written partnership agreement is highly recommended.
Again, as with the Sole Proprietorship, there is unlimited liability to the individual partners for the liabilities of the partnership. Further, because there is more than one individual there is joint and several liability exposure to the individual partners for the liabilities of the partnership. Taken to the extreme, a General Partnership could have hundreds of thousands of dollars in liabilities, above and beyond its assets, and one of the partners might be without assets, with the result being that the partner who has individual assets will have to satisfy all of the partnership debts. This form of doing business is equally as dangerous to one’s individual assets as operating in a Sole Proprietorship format, but in this form you can have double the problems. For the reasons set forth herein we generally recommend against doing business as a Sole Proprietorship or as a General Partnership except in the very embryonic stage of starting a business.