Hi, I would like to start a Partnership with my mom more of a LP or General Partnership, not sure if they are the same. I would like to know when its time to register the business name will she need to be there?
Hi Ramone, thank you for asking the question.
Congratulations on forming a partnership and starting a business.
Although a general partnership and limited partnership (LP) are similar, there are some key differences to consider before making a decision. A general partner in a business has the authority to make business decisions and legally bind the company in contracts. Whereas a limited partner may not be involved in the daily operations and management of a business. Instead, they typically contribute funds to the business which is also the extent of their total liability. However, general partners will be personally liable for the debts of the company and their personal assets may be on the hook when company debts are being collected.
Limited partnerships will still typically need to have a general partner that runs the business and is authorized to sign documents and conduct business operations. This partner will typically have all the decision-making authority, while a limited partner would not have any.
Which brings us to naming the business. A general partner will have to be there for naming the business. If you are both general partners, only one of you needs to be present. If only you are a general partner then you will need to be present. If you are a limited partner and your mom is the general partner then she will have to be present to sign all the documents. The important thing here is that a general partner will need to be present to sign the documents.
Best of luck! Dennis Shirshikov