How to Register a Domestic Partnership Firm?

The purpose of this article is to understand the concept of partnership and determine how a group of persons can enter into a partnership agreement.

GENERAL PARTNERSHIP:

Partnership is a contract or association between two or more persons. Persons who have entered into partnership with one another are called individually “partners” and collectively “a firm.

A partnership firm is created by an agreement alone along with required registration with your county or state. Minimum two persons are required to carry on a partnership business. Limited Liabilities Partnerships can be formed by one person only.

There are many advantages related to partnership businesses. In order to start a partnership, several formalities are required to be completed. Different states have different laws regarding partnership.

HERE ARE THE BASIC STEPS TO START A PARTNERSHIP FIRM:

In order to form a partnership, following essential elements must be taken into account:

• Contract or association between two or more persons
• Agreement to undertake the contract (partnership deed)
• Mutual or common interest
• Commitment to undertake a business
• Sharing of profit.

PARTNERSHIP REGISTRATION:

Partnership firm should get registered with the County Clerk Office or your state. While applying for registration, partners need to submit a copy of the partnership deed along with other documents to the concerned department.
A lawyer is hired for preparing the partnership deed. Once it is prepared and stamped, it should be read and signed by all the partners. It is an important document to settle dispute among the partners in case of partnership business.

GENERAL PARTNERSHIP FORMATION:

• Partners need to have a partnership deed which is accepted by all of them.
• A partnership deed usually sets out the following:
• Firm name
• Place or principal place of business of the firm
• Names of any other places where the firm carries on business
• The date when each partner joined the firm
• Number of partners
• Names in full and permanent addresses of partners
• Duration of partnership (if any)
• Purpose of the partnership
• Rights and duties of the partners.
• Amount of capital that each partner should put into the business, and keep n the business until the partner retires or the partnership is dissolved.

 
Partnership Registration For a Non US Resident
 
A non US resident can establish a Partnership Firm in the USA , but few states do not allow. You must have a physical address to register Partnership Firm. Registered agent  and  P. O. Box address is not acceptable.
Name availability

You should check the name availability before filing the application for registration. You can use the following link to check the name availability.

https://www.infotaxsquare.com/namesearch.php

How to File Taxes?

Partnership is a pass through entity, and profit and loss distribute to the partners to report on their personal returns.

Employer Identification Number:

Most states may have to ask you to obtain an Employer Identification Number (EIN) from the Internal Revenue Service Center prior to applying for the partnership registration to the county or your state.

Partnership Registration Renewal:

You are required to renew the partnership registration before its expiration.

Processing Time:

Current estimated time to register partnerships can be checked by using the following link.

https://www.infotaxsquare.com/partnership_registration.html
 

Author:    Sumaira Sharafat
              Charterd Accountant

This article is written for the informational purposes only and you cannot consider the contents in this  article a legal advice. The author has shared her opinion , not InfoTaxSquare.com.