What is a general partnership?

Starting a Business Together

When launching a new venture with someone else, choosing the right legal structure is one of the most critical decisions you will make. For many co-founders, a general partnership offers a straightforward and accessible entry point into the business world.

At its core, this structure is a formal business agreement where two or more individuals join forces to run a commercial enterprise. Partners share everything equally—from the daily assets and operational profits to the financial and legal liabilities. Because setting one up requires minimal paperwork and administrative overhead, it remains one of the most popular legal entities for small businesses and joint projects.

However, simplicity comes with a trade-off. Because liability is shared universally, each partner is typically personally responsible for the debts and obligations of the entire business. Before entering into this type of arrangement, it is vital to weigh the benefits of easy setup and pass-through taxation against the potential risks to personal assets.