What You Should Know About Limited Partnership
Much like a mismatched marriage, collaborating with the wrong business partner at the wrong time will lead to disastrous consequences for your business sometimes it will be impossible to recover from them. The need for another entrepreneur who brings to the table skills and contacts lacking and who will help to get a business either get started or climb to the next level of competitiveness cannot be discounted.
Caution is still the need of the hour, and just like dating sites will seek to match you up with the potential spouse of your dreams, a failure to be honest and open with your wants and needs and a lack of a good dose of gut level common sense can still set you up for failure. The goal is not to double your effort but to take advantage of the much-needed skills and knowledge that someone brings to your business which you lack. Somebody may be a whiz at computer programming, but if she or he lacks that go-getter attitude that you have, then this match will not flourish.
Take your time when meeting a potential partner in a limited partnership. A younger person will bring an enthusiasm and zest to your business which you might be lacking although you might not know it while an older individual will bring life experience and quite possibly also years of business acumen which you simply have not been able to have. There are too many business settings you can have.
A limited partnership is a type of partnership that have ore or less similarities to a general partnership, but the difference is that a general partnership should have two general partners, and a single limited partnership should have one general partner and one limited partner.
The general partners are, in all respects, has a similar position in great partners in a company, especially when they have unique share of the right to use a partnership property, a management control, joint and several liability for the debts, and share the profits of the company at fair proportions.As in a general partnership, the general partners have authorized, as the agents of their own company, to bind contracts in partnership with the other parties during the course of the business.
What you should know about limited partnership
Same goes to the shareholders in a specific corporation, limited partners in a limited partnership have limited liability. In other words, the limited partners have zero management authority, and are not liable for the debts of such partnership (unless they have obligated themselves by another contract such as the guaranty). The limited partnership delivers the limited partners some good return on their investments (the same goes to a dividend), and the extent and nature of which is typically defined in partnership agreement. Unlike the limited partners in a limited partnership, general partners will bear more economic risks and if there is a monetary loss, the general partners will be liable.
Limited partnership interests are afforded a considerable level of protection and safety through the charging order mechanism.