Create a General Partnership in Florida

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Florida General Partnership

A Florida general partnership is easy to form and offers tax advantages, but there are some drawbacks. In this guide on forming a partnership in Florida, we’ll explain what steps you need to take and discuss the pros and cons so you can decide if this business structure is right for you. 

Step 1: Determine if you should start a general partnership

Before jumping into a for-profit business venture with someone, consider whether a Florida general partnership suits your needs. 

Pros

A partnership offers the following benefits:

An important characteristic of general partnerships is that they end if a partner leaves or passes away unless otherwise agreed upon. This can be seen as either a pro or a con. If you want a long-term business, then a Florida general partnership may not be the way to go. 

Cons

General partnerships aren’t for everyone, so consider the following disadvantages:

Carefully evaluate the pros and cons of a Florida general partnership before creating one. It may be best to speak with a financial or legal professional about what business entity option to choose. 

Step 2: Choose a Business Name

A business name is significant because it’s the first impression people get of your company. Unregistered general partnerships typically use the last names of the partners as the formal business name. Although you don’t need to register as a general partnership in Florida, any business that uses a fictitious name (or “doing business as” name) must register it with the Florida Department of State before carrying on their business. 

Step 3: File a DBA Name (if needed)

Florida refers to a DBA name as a fictitious name. This is a business name that’s different from your personal name and your entity’s legal name. To register your fictitious name, you must take the following steps:

Failure to register your fictitious name is a misdemeanor in the second degree. 

Step 4: Draft and sign partnership agreement

A partnership agreement is a rulebook for your business. This legal document dictates how the business is run, resolves conflicts, spells out profit and loss sharing, and governs the relationships between the partners. The purpose of a partnership agreement is to have everyone on the same page and avoid disagreements. 

Without a partnership agreement, your business operations are governed by Florida’s Revised Uniform Partnership Act. You may not like how an issue is resolved under the law, so that’s why it’s important to create your own Florida general partnership agreement. 

Step 5: Obtain licenses, permits, clearances

Your general partnership may have to get certain licenses, permits, and certificates to lawfully conduct business in Florida. What you need depends on your location and business activities. Keep in mind there are licensing requirements at the federal, state, and local levels. 

If you’re unsure about what licenses and permits you need and where to start looking, let us help. With our Business License Report Service, our partners at Avalara will generate a report that shows the licenses you need to legally operate at the local, state, and federal levels in Florida. 

Step 6: Get an Employer Identification Number (EIN)

An Employer Identification Number (EIN) is a nine-digit code that the IRS issues to businesses. It’s like a social security number for companies, and it’s what you’ll use to file taxes, hire employees, or open a business bank account. The IRS requires all partnerships to have an EIN. 

You can apply for one on the IRS’s website or let us take care of it with our EIN Service.

Step 7: Get Florida State Tax Identification Numbers

Your business may be required to pay taxes in Florida if it’s engaged in certain activities.  You need to register your business with the Florida Department of Revenue to pay the taxes. To register, complete and submit the Florida Business Tax Application, either online or using the paper Form DR-1. 

After registering with the Department of Revenue, you’ll receive a business partner number. This number will be on the back of your certificate of registration.  

Forming a Business Partnership in Florida: Next Steps

After forming your general partnership in Florida, but before you really get going, consider doing a few things. Open a business bank account to keep business and personal money and transactions separate. Having a separate account will come in handy when it’s time to file taxes. Also, speak with an insurance agent to understand what coverage you should have to protect yourself and your business. 

How We Can Help

Setting up a Florida general partnership is the easy part. Running your business and keeping up with state filing requirements is where things can get complicated. That’s where we come in. With our Worry-Free Compliance Service, our experts will help you keep your business in good standing with the state and remind you of upcoming filing requirements. We also offer a range of products and services, all designed to help your small business succeed. 

If you’re interested in forming a different type of business, we can help with our Florida Limited Liability Company Formation Service and Florida Corporation Formation Service

Disclaimer: The content on this page is for information purposes only, and does not constitute legal, tax, or accounting advice. If you have specific questions about any of these topics, seek the counsel of a licensed professional.

FAQs

  1. Do general partnerships have to register in Florida?

    There’s no Florida general partnership registration required to start your business. However, you do need to register to pay taxes, get licenses, and use a fictitious business name.

  2. Does Florida tax general partnerships?

    General partnerships aren’t subject to income tax, but they must file an Information Return with the Florida Department of Revenue. Your general partnership may owe other taxes depending on the business activities.

  3. What is the difference between a partner and an owner?

    Partners both own a portion of the partnership and engage in running the business. In a partnership, the partners are the owners.

  4. How is a general partnership organized?

    You can form a general partnership simply by carrying on a business for profit with one or more individuals. The partners can choose to let Florida partnership law dictate how the company operates or make their own rules through a partnership agreement.

  5. Who is responsible for the debts in a general partnership?

    Unless the partners agree otherwise, the individual partners equally share the responsibility for any partnership debts. Creditors can seek compensation from any partner for all the debts of the partnership.

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