When two or more people come together to operate a business, they are said to be in a partnership. In a general partnership, each partner shares profits and losses equally unless otherwise specified in the partnership agreement. For general partnerships, there is no need for a written agreement to make the partnership valid.
Limited liability partnerships and limited liability companies are two similar but distinct types of business entity. Neither one is required to pay corporate taxes; instead, taxation falls upon the individual partners or members. Both entities are very flexible in their structure, allowing them to fit the needs of many types of company, but key differences between them set the two types apart.
Michigan entrepreneurs may be interested in learning about the different types of business that can be formed. One type, a partnership, is a simple way to structure a business. They have no formal requirements and do not necessitate paperwork, but in some cases, outlining duties and obligations may be beneficial. There are a number of different types of partnerships. Each type provides varying benefits and restrictions.