What is the difference between a general partner and a limited partner?
A general partner assumes responsibility for the liabilities and debts of the partnership. A limited partner has chosen to give up power over the operation or management of the business in exchange for less liability. A business may have one or more general partners and one or more limited partners (or none). What is the benefit of forming a partnership? Forms you may need to create, maintain, or dissolve your partnership include: • Certificate of Limited Partnership • Articles of Association of Limited Partnership Association • Registration Statement as a Limited Liability Partnership or Limited Liability Limited Partnership • Co-Partnership Agreement • Dissolution of Partnership Below are the necessary forms for partnership.
A general partner, who is usually charged with operation and day-to-day management of the partnership’s affairs and business, takes on personal liability for the obligations and debts of the partnership and the actions of the other partners. A limited partner is shielded from such liability and traditionally is not as involved in the day-to-day affairs of the limited partnership. Until recently a limited partner’s shield from liability was threatened or removed if the limited partner became involved in the management or operation of the limited partnership, but in 1997 changes to the laws regulating limited partnerships allowed a limited partner to participate in limited partnership management without risking liability for the limited partnership’s obligations.
A general partner, who is usually charged with operation and day-to-day management of the partnership’s affairs and business, takes on personal liability for the obligations and debts of the partnership and the actions of the other partners. A limited partner is shielded from such liability and traditionally is not as involved in the day-to-day affairs of the limited partnership. Until recently, a limited partner’s shield from liability was threatened or removed if the limited partner became involved in the management or operation of the limited partnership; but, in 1997 changes to the laws regulating limited partnerships allowed a limited partner to participate in limited partnership management without risking liability for the limited partnership’s obligations.
