Definitions (2)

1. A type of unincorporated business organization in which multiple individuals, called general partners, manage the business and are equally liable for its debts; other individuals called limited partners may invest but not be directly involved in management and are liable only to the extent of their investments. Unlike a Limited Liability Company or a corporation, in a partnership each partner shares equal responsibility for the company's profits and losses, and its debts and liabilities. The partnership itself does not pay income taxes, but each partner has to report their share of business profits or losses on their individual tax return.
Estimated tax payments are also necessary for each of the partners for the year in progress. Partnerships must file a return on Form 1065 showing income and deductions. Estimated tax payments are also required if they expect their income to be greater than $1,000.
2. More generally, a relationship of two or more entities conducting business for mutual benefit.

Use partnership in a sentence

You should only enter in to a partnership with someone that you trust to not be to greedy over the long run.

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After graduation, several of my friends and I pooled our talents and financial resources to form a partnership in the real estate industry.

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My dad and our neighbor jointly came up with a new invention that was going to revolutionize the computer industry, so they formed a Limited Partnership.

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