Important Notice: Our web hosting provider recently started charging us for additional visits, which was unexpected. In response, we're seeking donations. Depending on the situation, we may explore different monetization options for our Community and Expert Contributors. It's crucial to provide more returns for their expertise and offer more Expert Validated Answers or AI Validated Answers. Learn more about our hosting issue here.

Are partners personally liable for business debts?

April 26, 2017Business debts liable partners personally

0

Posted

Are partners personally liable for business debts?

1 Answer

0

Posted

Yes. A partnership is legally inseparable from its owners. Each partner (with the exception of the limited partners in a limited partnership) is personally liable for the entire amount of any business obligations. If you form a partnership, creditors can come after your personal assets (such as your house or your car) to satisfy any partnership debts. A partner is also legally bound by business transactions made by him or his partners and can be held personally liable for those transactions. In contrast, owners of corporations are not personally liable for business debts. For more information on partnerships, limited partnerships and corporations, please read the free legal tutorial entitled Small Business Legal Structure found in the Lean Law Library.