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Business Partnership Guide: How to Collection on Forming Partnerships

written by: •edited by: Donna Cosmato•updated: 9/13/2011

Where do new entrepreneurs find business partners? What’s involved in a partnership and how do you go about starting one? We answer every partnership question you have in this all-inclusive guide to partnerships.

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    Do You Need a Partner?

    Do You Need a Partner Michael Eisner of Disney fame once said, “It’s rare a business partner who is selfless. If you are lucky it happens once in a lifetime.” This statement is definitely true even if everyone agrees at the beginning and everything on paper looks great. Partners disagree and argue or once involved in the venture decide they want out or simply don’t participate, even though the liability is still there.

    Fear not, however, as the collection of articles below will aid you to find the right partner and know what to do when things go south. There are suggestions about business partner must-haves and information about what to do when it’s time to get rid of a partner or totally dissolve the business.

    In today’s challenging business world, obtaining a partner is necessary whether you want one or not simply because of the needed capital investment dollars and it’s often hard to obtain a business loan on your own. Here, we make all this a little bit easier, even when times are tough.

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    Finding a Partner and Working Together

    Finding a Great Partner Sometimes a wannabe entrepreneur needs a business partner. It could be for needed working capital, the partner may have a better credit score or access to funds, or there is a family member who wants to be a part of the business. Whatever the reason, there are definite rules you should follow when forming a corporate entity with even just one partner to avoid mishaps down the road.

    If you don’t already have one, you’ll have to find a business partner first. This group of articles will help you find ways to choose the best partner, learn how to communicate effectively and even negotiate so it’s a win-win situation for both sides.

    What if you choose a friend as a partner? Is this a good idea? Even better, should married couples start a partnership together? Finally, locating the right partner is important, so the following will aid you in making this an easy decision right off the bat.

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    When Things Go Bad

    When Things Go Wrong There may be times when partners disagree or you may even have a partner you want to rid yourself of ASAP. The next group of articles deals with the bad elements of forming a partnership. For example, if you find yourself in business partner purgatory, learn how to dump your partner with ease. If your disagreements are so intense you can’t agree on anything, we’ve got tips for that as well.

    Believe it or not, some partners may sign on and then you never hear from or see them again. What do you do if this happens? Perhaps your partner is stealing from the company or is so abusive to work with you wish the partnership was never formed in the first place. Our partnership collection of articles helps with the tough issues too, even if you feel like you’re the one carrying all the weight.

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    Business Partner Musts

    Business Partner Musts Do not form a partnership without an agreement and to ensure it protects both of you, don’t try and write it yourself. It is the time to invest in an attorney for this purpose. You will want to obtain certain items such as an insurance policy on your associate as well. In the event you find your partner’s spending is out of control, what do you do then? You can solve these sorts of disputes easily and quickly if you nip them in the bud right away.

    Tax time comes around annually and the Internal Revenue Service will want to hear from you on a yearly basis. So, are there any special tax laws for partnerships? What if you have a husband and wife partnership? Are the tax laws the same or different? These are important to know before you file your annual tax return.

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    Buying Out a Partner or Dissolving a Partnership

    Buying a Partner Out Whether it’s time to close the doors of the business for good or if you just want to buy out your partner, how do you go about it? Can you dissolve a partnership and what steps are needed to ensure you do this correctly? Is there more than one option for buying out a partner?

    What if you both feel bankruptcy is the only way out; will Chapter 11 restructuring work for your company? Or, can you avoid bankruptcy by simply closing the business?

    You’ll also need to know what to do when your partner or you want to retire. When the time comes to close the doors for good, how do you let your customers and vendors know you’ve gone out of business? The following posts answer these questions so you don’t have to guess about what to do and when to do it or what action to take when the partnership is over and done with.

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    Making it Easy

    As you can see, our partnership guide will make things a little easier for you when you go into business with one or more partners. This can be an exciting world as long as you remember both of you are two unique individuals and if you have more than one partner, more personalities come into play so keep that in mind.

    The wonderful world of becoming an entrepreneur is an exciting world and we hope you bookmark this page and check it often to ensure you and your partner(s) stay on the right path to success. If you can't find an answer to your partnership question here, leave us a comment and we'll find the answer for you!