General Partnership

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DEFINITION of 'General Partnership'

A arrangement by which partners conducting a business jointly have unlimited liability, which means their personal assets are liable to the partnership's obligations.

INVESTOPEDIA EXPLAINS 'General Partnership'

Since all partners have unlimited liability, even innocent partners can be held responsible when another partner commits inappropriate or illegal actions. This fact alone demonstrates how an investor should heed caution when deciding on whether to become a general partner.

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RELATED FAQS
  1. What's the difference between limited liability partnership and general partnership?

    A partnership is a business agreement between two or more people who are called partners. Each partner owns a share of the ... Read Full Answer >>
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