Create a General Partnership in Mississippi

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Mississippi General Partnership

A Mississippi general partnership is a business that can be started by two or more people. The State of Mississippi allows for general partnerships, but it doesn’t require them to file any formation documents with the Secretary of State (SOS) like other types of business entities.

This article will show you how to form a general partnership in Mississippi and help you decide if it’s right for you.

Step 1: Determine if you should start a general partnership

You should first understand what you can and can’t do with a general partnership business structure. Forming a partnership in Mississippi may not be right for every type of business. There are pros and cons, and you need to figure out if they fit within your plans.

Pros

Here are the positive aspects of forming a partnership:

The biggest benefit of a Mississippi general partnership is the fact that it’s so easy to create.

Cons

The ease of creating a partnership might be outweighed by the cons.

If a general partnership isn’t right for you, there are other ways to structure a business, such as a limited liability partnership, LLC, or corporation.

Step 2: Choose a business name

General partnerships must at least include the surnames of the partners. To use a different name, the partners can use a DBA (doing business as) name, which is more commonly known as a fictitious name in the state of Mississippi. Although there’s no legal requirement to register a fictitious name with the state, there are good reasons to do so.

Step 3: File a DBA Name (if needed)

As stated in Step 2, a general partnership can use a fictitious name and not have to register it with the state. However, there are some good reasons why you should register your fictitious name with the Mississippi Secretary of State. To go over these in more detail and for help registering a fictitious name, we offer a DBA service to help guide you.

Step 4: Draft and sign Partnership Agreement

Partnership Agreements are where the partners put the rules they’ve already agreed upon into writing. Putting operational rules in writing can help each partner know what the agreed-upon responsibilities are and how the company should be run. Mississippi doesn’t require a Partnership Agreement for any Mississippi general partnership. But it’s still a good idea to take the time to create one.

When these rules aren’t written down and there’s a dispute amongst the partners, the state’s Uniform Partnership Act of 1997 will control how things are resolved. But these general rules weren’t created with your enterprise in mind and the actions they dictate may not be the best course of action for you. The way to avoid having generalized rules govern your company is to create a Partnership Agreement.

Step 5: Obtain licenses, permits, clearances

A partnership must obtain business licenses, permits, and clearances when necessary. With our Business License Report, you can be assured that you’ve obtained all the necessary licenses, permits, and clearances. This is one area where many new business owners make mistakes that could cost them dearly.  No matter what type of business you have, you’ll likely need some type of permit from one or more governmental agencies.

Step 6: Get an Employer Identification Number (EIN)

An Employer Identification Number (EIN) is obtained through the IRS. Basically, it acts as your company’s identification number, similar to a social security number. With it, you can file taxes, open a bank account, and apply for loans. We offer an Employer ID Number Service to easily and quickly accomplish this task.

Step 7: Get Mississippi state tax identification number

Other than the EIN you get from the IRS, Mississippi only requires one other identification number. Depending on what your company does, you may have to register for a business tax account, especially if you’ll be paying sales and use taxes.

Forming a Business Partnership in Mississippi: Next Steps

A general partnership is a great way to start a business in Mississippi. It’s easy to set up and there are tax advantages. But if you have questions, always remember to review your plans with a tax or legal professional.

How We Can Help

Not only do we help with starting your company, but we offer continued help with our business development and maintenance services. We work hard to make compliance easy so you can focus on more important things like making your company a success.

For other types of business structures that do need to make initial filings with the SOS, we offer assistance through our Mississippi LLC formation services and Mississippi corporation formation services

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 Mississippi?

    No. You don’t have to register as a general partnership in Mississippi. But there are benefits to registering your DBA, even though it’s not required.

  2. Does Mississippi tax general partnerships?

    No. There’s no taxation at the partnership level. The profits the partnership earns pass through to the individual partners who then pay taxes on the income on their personal tax returns.

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

    An owner of a company usually is the sole person who controls every aspect of the business and is one person responsible for everything. With a general partnership, each partner is a shared owner of the company. They share the profits and the liabilities.

  4. How is a general partnership organized?

    A business partnership in Mississippi can be organized in any way that the partners agree. Often, partners will put these organizational and operational decisions into writing in a Partnership Agreement.

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

    Each partner is responsible for the debts and liabilities of the general partnership.

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