Good examples of general partnership can be a law firm, architectural firm and medical practice. A general partnership is a form of business where two or more people come together to do business for a profit. Each partner contributes to all the activities of the business, including skills, labor, money and property.
The profits and losses of a general partnership are usually shared among all the partners equally. Partners are required to include their share of the profits or losses in their tax return forms. A partner can join a general partnership through an oral or written agreement that entails all the terms and conditions of the partnership. All partners are liable to all the actions done by any partner in the ordinary course of the business, as stated by Nolo.
Some partnerships can have limited partnership thus allowing some partners to have limited personal liability. To start a general partnership, the partners will need to register with their state in the office of the Secretary of State. The business name and the legal names of all the partners are necessary for registration. After registration, the business needs to have permits and a license. The business does not pay income tax, but must file annually to report the deductions, income, losses and profits of its operations.