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General Partnerships in Wyoming

by Norris Law Group on August 12, 2014

General Partnerships in WyomingPerhaps you and your spouse or you and a friend want to start or have started a business in Wyoming. When one or more people own a business, it may be wise to enter into a legal partnership. The state of Wyoming offers several options that allow people to establish businesses together. A “general partnership” is one of them. According to the Office of the Secretary of State of Wyoming, a general partnership “is an association of at least two persons who co-own a business.” On page 5 of “The Choice is Yours,” a publication offered by the WY Secretary of State, general partnerships are explained. Individuals, small businesses, and even corporations may come together in a general partnership. From a legal perspective, partnerships are relatively easy to set up and operate—even a verbal agreement may stand as a legal partnership. Partners may also decide how they want to make decisions for the business; they may do so in a formal meeting or over a cup of coffee. But while this all may sound simple, Wyoming general partnerships do carry some advantages and disadvantages.

Advantages of General Partnerships in Wyoming

  • Easy and inexpensive to set up (no state or federal filings are required)
  • Easy operation
  • May file a “statement of partnership authority” with the Secretary of State (partnership agreement, names of partners, etc.)
  • Each partner pays tax on his or her share of partnership profits
  • “Quasi-entity status,” meaning that a partnership “may own assets, contract in partnership name, may sue and be sued in partnership name”
  • Equal sharing of management and profits per partnership agreement.

Disadvantages of General Partnerships in Wyoming

  • “Unlimited liability: ” all partners are equally responsible for the actions of other partners
  • No “continuity of life:” if one or more partners dies or is unable to fulfill his or her duties, the partnership must dissolve or be restructured (if the partnership contains provisions for this, they must be followed
  • Limited financing opportunities: only loans or partners’ savings may be used as capital.
  • Possibility of “deadlock:” partners may not always agree on decisions, but all partners must be involved in all decisions.

Attorney Graham Norris and his associates at the Norris Law Group serve the residents of Utah County, UT and throughout Utah, Wyoming and Idaho. Contact them today at 801-932-1238 or online for a free consultation.

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