general partnership and limited partnership

[larmes]

My father currently has an S Corp. My sister and I are taking over the business. We are splitting it 50/50 but she wants to be general partner and make me limited partner. What is involved in changing this arrangement in the future? And also, can there be two General Parners?

 

[JETX]

Here are the legal definitions of the two terms:

general partnership
: a partnership in which each partner is liable for all partnership debts and obligations in full regardless of the amount of the individual partner's capital contribution

limited partnership
: a partnership in which the business is managed by one or more general partners and is provided with capital by limited partners who do not participate in management but who share in profits and whose individual liability is limited to the amount of their respective capital contributions

Once you understand this, both of you might want to re-consider your use of the terms. Personally, I would suggest that you consider a "Limited Liability Partnership" which is:
: a partnership formed under applicable state statute in which the partnership is liable as an entity for debts and obligations and the
partners are not liable personally.

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Steve Halket
Judgment Recovery of Houston
[email protected]
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This is my PERSONAL OPINION and is not legal advice! Consult your local attorney for your specific situation and laws!