How to Create a General Partnership in Missouri: A Beginner’s Guide


Steve Goldstein
Steve Goldstein
Business Formation Expert
Steve Goldstein runs LLCBuddy, helping entrepreneurs set up their LLCs easily. He offers clear guides, articles, and FAQs to simplify the process. His team keeps everything accurate and current, focusing on state rules, registered agents, and compliance. Steve’s passion for helping businesses grow makes LLCBuddy a go-to resource for starting and managing an LLC.

All Posts by Steve Goldstein →
Business Formation Expert  |   Fact Checked by Editorial Staff
Last updated: 
LLCBuddy™ offers informative content for educational purposes only, not as a substitute for professional legal or tax advice. We may earn commissions if you use the services we recommend on this site.
At LLCBuddy, we don't just offer information; we provide a curated experience backed by extensive research and expertise. Led by Steve Goldstein, a seasoned expert in the LLC formation sector, our platform is built on years of hands-on experience and a deep understanding of the nuances involved in establishing and running an LLC. We've navigated the intricacies of the industry, sifted through the complexities, and packaged our knowledge into a comprehensive, user-friendly guide. Our commitment is to empower you with reliable, up-to-date, and actionable insights, ensuring you make informed decisions. With LLCBuddy, you're not just getting a tutorial; you're gaining a trustworthy partner for your entrepreneurial journey.
Create a General Partnership in Missouri

Forming a general partnership in Missouri can be a great way to combine your skills, resources, and ideas to create a thriving business. In Missouri, also known as The Show-Me State, general partnerships are relatively easy to establish, making them an attractive option for entrepreneurs who want to keep things simple and cost-effective.

This article will guide you through the essential steps to start a general partnership in Missouri. From understanding the legal requirements and drafting a partnership agreement to registering your partnership and obtaining necessary permits, we’ll provide you with the necessary tools and insights to help you launch your business venture. Whether you’re opening a boutique retail store or a cutting-edge tech startup, this comprehensive guide will help you navigate the process of starting a general partnership in Missouri.

What is General Partnership In Missouri

It is a business structure where two or more people come together to form a jointly owned business. In the general partnership business, the partners agree upon sharing assets, responsibilities, profits, and liabilities (legal & financial). In a general partnership, Partners consent to carry potentially unlimited liability personally. Liabilities are not restricted as they would be, for example, in a limited liability partnership (LLP) or a limited liability company (LLC) structure. Unlike the LLCs, a partner, in this case, can be legally sued for any business debts, and a possibility of seizure of personal assets can occur.

Before you start setting up your general partnership, it is advised that you consult a legal person. They will know what is best for you and your business. You can always form an LLC instead of a general partnership to protect your personal assets from business debts.

LLCBuddy Editorial Team

How to Create a General Partnership in Missouri

To create a general partnership in Missouri, you must follow the guidelines below: forming a business name, making a partnership agreement, requesting an EIN, getting a license and permit, getting a state-based tax ID, and opening a bank account.

Step 1: Choose a Business Name in Missouri

Naming your business is one of the most crucial activities during the startup phase. Your general partnership name is the foundation for your brand in Missouri and is what clients use to connect you to the products or services you offer. Legal procedures should be taken into account when choosing your partnership name. Choose a business name that will enable you to develop a strong brand identity without being hampered by irrelevant factors.

If you want to set up an LLC, there is a complete guide on Missouri LLC name guidelines for a proper business name. Here are some guidelines you must follow while naming your general partnership-

  • Name availability: The name should be available, and no other entity should have the same name in Missouri.
  • Trademarks
  • Limit of restricted words that need a license in Missouri

In Missouri, if you register your general partnership business with the Missouri Secretary of State, then the name you choose will be the company’s official name. On the contrary, unregistered general partnership businesses use the last name of all of their partners by default. For instance, if Selena Gomez and Hailey Beiber enter business together, the partnership name is “Gomez & Bieber” by default if unregistered. However, if you would like to form a business name under something more appropriate, such as “EJI Design and Build,” then you’ll need to file a “Doing Business As (DBA)” name with Missouri SOS.

In Missouri, if you do not wish to file your general partnership business right away but want to hold the name that you have decided on, then you can reserve your business name for 60 days. You must file a name reservation application with the SOS to keep the name.

Step 2: Make a Partnership Agreement

After you have chosen a business name for your general partnership, the next step would be making a partnership agreement in Missouri. A partnership agreement is a legal contract that specifies how a for-profit company would operate when run by two or more people.

The partnership agreement specifies each partner’s roles within the company, their ownership stakes, and their share of profits and losses. Additionally, it discusses business management guidelines and potential contingencies that may arise, such as a partner’s passing or a partner’s decision to leave the partnership. A partnership agreement should include the following:

  • Name of Partners
  • The principal address of the partnership
  • Purpose of the partnership
  • Terms of the partnership
  • Partnership start date and end date (if not for infinite time)
  • Partnership dissolution terms (for finite partnership)
  • Capital contribution of partners
  • Share of Interest of Partners
  • Profit distribution of partners (equal distribution by default, if not specifies any special condition)
  • Salary distribution (if applicable)
  • Partnership Management Terms
  • Terms of Partnership Sale

These key factors must be considered when forming or creating a partnership agreement in Missouri. In this way, all business partners will understand what this is about and how to proceed if the mentioned scenarios happen in Missouri.

Without a Partnership Agreement, your company will often be subject to the general partnership default laws of Missouri. The default laws in Missouri might not be appropriate for your requirements. Hence, it is important to have a transparent agreement while forming a partnership.

Step 3: Request an EIN in Missouri

After documenting the partnership agreement, you should get or request an Employer Identification Number (EIN). An EIN will serve as the tax ID for your general partnership. EIN can be obtained from the Internal Revenue Service (IRS). It is a 9-digit number similar to Social Security Number. EIN, however, is distinct from SSN. It is only used for business-related activities, particularly for submitting general taxes. The form must be completed and uploaded to the IRS website. Getting EIN is necessary whether you are opening an LLC in Missouri, or a general partnership, or something else.

The application of an EIN in Missouri can be through the following:

  • Apply Online- You can apply for EIN online, which is the most desirable and fastest method for users.
  • Apply by Fax- Another method of obtaining EIN is to fax Form SS-4 (PDF) after entering all the correct information to (855) 641-6935.
  • Apply by Mail- The EIN application Form SS-4 can be filed via mail. The processing time frame to receive the mail is 4 weeks.
  • Apply by Telephone-International Applicants – International applicants may call 267-941-1099 (not a toll-free number) from 6 a.m. to 11 p.m. (Eastern Time) Monday through Friday to obtain their EIN.

After you have your EIN number, you can benefit in several ways. It will provide your general partnership with the final advantage necessary to operate fully without encountering legal or judicial issues. For more details about EIN for your business, you may check why you need EIN.

Step 4: License and Permit for General Partnership in Missouri

Before your general partnership business operates in Missouri, you must have a business license first. A business license is a document issued by a government agency that permits you to operate your business in the geographic region that that agency governs.

To legally operate your partnership, you must apply for a business license to Missouri Secretary of State. In some states, you might need to obtain a Privilege License. Based on the business structure, you might need it. In Missouri, partnership businesses do not need to get to obtain a privilege license. You might even need more than one license in Missouri. Numerous general partnership licenses need to be filed and renewed regularly.

Step 5: Obtain Missouri Tax ID Number

In Missouri, to conduct a business, you must comply with the Missouri Department of Revenue. If you have a general partnership in Missouri, you must obtain the Missouri Tax ID number from Missouri Department of Revenue. Your partnership business must pay state taxes (if applicable).

Step 6: Open a Bank Account

Once you have filed and received your general partnership license, you should now open a bank account since you will use this account for yourself, your clients, and your employees.

Your business dealings in Missouri might be simpler with a US business bank account because it boosts your company’s legitimacy and liquidity. Most banks demand an EIN for creating a business bank account for firms other than sole proprietorships. Also, keeping separate finances helps you avoid combining personal and professional finances.

Example of General Partnership in Missouri

Individuals looking to collaborate and numerous kinds of service providers have chosen general partnerships as their preferred business entity. That’s frequently because of its simple design, low price, and simplicity of setup. Some general partnership examples include:

  • Providing professional services (architectural firms, medical clinics, etc.)
  • Selling goods at retail
  • Opening a restaurant
  • Business Consulting

General partnerships are also formed by partners who are spouses or other family members who want to operate a business together.

Important Information

Maintaining Business License in Missouri

Now that you have established your general partnership, you must maintain or renew your business license every now and then. Make time to check the status of your licenses at least once per year. Then, you can keep from missing anything significant. If there are any issues, you can address them.

Paying your Taxes in Missouri

Even if you have established your general partnership in Missouri, pay your taxes and keep everything up to date so you won’t pay any penalty. Missouri tax information will help you with what to pay before or during the operation of your professional corporation. You must check with Missouri Department of Revenue for more details.

Advantages of General Partnership in Missouri

  • Foundation only requires two people: Forming a general partnership doesn’t need many people to operate. You can form a general partnership with a partner in mind and a business plan. It can be a group of friends or colleagues, a family member, or a spouse and wife partnership.
  • Equal Rights: Everyone is granted equal rights when a business is founded using a general partnership; each partner is free to express their ideas and choose what is best for the company’s success.
  • Management Option: One of the advantages of joining a general partnership is the opportunity to select the finest management options for the company. For this reason, large partnerships should draft an agreement describing each partner’s responsibilities inside the business. As a result, each partner’s leadership abilities are enhanced.
  • Flexibility: General Partnership is the basic form of a business structure since it can be converted into any business entity, such as LLC. If you have flexibility in applying for an LLC in Missouri, you will have default rules set by law, and you need to have an operating agreement for this.
  • Pass-through taxation: The pass-through tax structure will make the general partnership business not pay twice the tax. Due to this structure, most start-ups and entrepreneurs in Missouri apply for a GP or LLC. And one of the main advantages of a general partnership is that partners don’t have to pay for the losses collectively.

FAQs

What is a general partnership in Missouri?
A general partnership in Missouri is an unincorporated business owned and managed by two or more people who share in the profits and losses of the enterprise.
How do I form a general partnership in Missouri?
To form a general partnership in Missouri, you must draft and sign a partnership agreement and register your business with the Missouri Secretary of State.
What documents do I need to form a general partnership in Missouri?
To form a general partnership in Missouri, you must draft and sign a partnership agreement and register your business with the Missouri Secretary of State.
Is a general partnership in Missouri taxed?
Yes, a general partnership in Missouri will be taxed on the profits of the business.
How do I register my general partnership in Missouri?
To register your general partnership in Missouri, you must file a Certificate of Partnership with the Missouri Secretary of State.
What is the filing fee for registering a general partnership in Missouri?
The filing fee for registering a general partnership in Missouri is $50.
What are the legal requirements for a general partnership in Missouri?
The legal requirements for a general partnership in Missouri include filing the Certificate of Partnership with the Missouri Secretary of State, drafting and signing a partnership agreement, and registering the business with the state.
What are the management requirements for a general partnership in Missouri?
The management requirements for a general partnership in Missouri depend on the partnership agreement. Generally, the partners must agree on the management and control of the business.
Are general partners liable for the debts and obligations of the partnership in Missouri?
Yes, general partners in Missouri are liable for the debts and obligations of the partnership.
Can a general partnership in Missouri sue or be sued?
Yes, a general partnership in Missouri can sue or be sued.
What are the advantages of a general partnership in Missouri?
The advantages of a general partnership in Missouri include ease of formation, fewer regulatory requirements, and pass-through taxation.
What are the disadvantages of a general partnership in Missouri?
The disadvantages of a general partnership in Missouri include unlimited liability for the partners, difficulty in transferring interests, and lack of continuity.
Who is liable for the debts of the general partnership in Missouri?
All of the partners in the general partnership in Missouri are liable for the debts of the business.
Is a separate bank account required for a general partnership in Missouri?
Yes, it is recommended that a separate bank account be opened for a general partnership in Missouri.
Is a partnership agreement required for a general partnership in Missouri?
Yes, it is recommended that a partnership agreement be drafted and signed for a general partnership in Missouri.
Are the partners of a general partnership in Missouri required to contribute capital?
Yes, the partners of a general partnership in Missouri are required to contribute capital in order to finance the business.
What types of tax returns must a general partnership in Missouri file?
A general partnership in Missouri must file an annual partnership return and individual tax returns for each partner.
Does a general partnership in Missouri need an Employer Identification Number (EIN)?
Yes, a general partnership in Missouri must obtain an Employer Identification Number (EIN) from the Internal Revenue Service (IRS).
Can a partner in a general partnership in Missouri be held liable for the actions of the other partners?
Yes, a partner in a general partnership in Missouri can be held liable for the actions of the other partners.
Are there any restrictions on the activities of a general partnership in Missouri?
Yes, the activities of a general partnership in Missouri are limited by the partnership agreement and by state and federal law.
Can a partner in a general partnership in Missouri be held liable for the debts of the business?
Yes, a partner in a general partnership in Missouri can be held liable for the debts of the business.
Can a general partnership in Missouri own property?
Yes, a general partnership in Missouri can own property, but it must be held in the partnership’s name.
Is a general partnership in Missouri required to have a business license?
Yes, a general partnership in Missouri may need to obtain a business license from the county or city where the business is located.
Does a general partnership in Missouri need to register a trade name?
Yes, a general partnership in Missouri may need to register a trade name with the Missouri Secretary of State if the business is operating under a different name than the partnership name.
Are the profits of a general partnership in Missouri subject to self-employment tax?
Yes, the profits of a general partnership in Missouri are subject to self-employment tax.
Is a general partnership in Missouri required to file special reports with the state?
No, a general partnership in Missouri is not required to file special reports with the state.
Does a general partnership in Missouri need to file estimated taxes?
Yes, the partners of a general partnership in Missouri are required to file estimated taxes on their profits.
Is a general partnership in Missouri required to have a registered agent?
Yes, a general partnership in Missouri must have a registered agent in order to receive service of process.
Can a general partnership in Missouri be dissolved?
Yes, a general partnership in Missouri can be dissolved in accordance with the terms of the partnership agreement and applicable state law.
What are the requirements to Create a General Partnership in Missouri?
To create a general partnership in Missouri, you must register with the Missouri Secretary of State and create a partnership agreement that outlines the terms of the business.
What are the benefits of forming a general partnership in Missouri?
Forming a general partnership in Missouri allows you to share the profits and losses of the business, as well as the liability. It is relatively simple and inexpensive to register, and there is no requirement to file annual reports with the state.
What are the tax implications of forming a general partnership in Missouri?
A general partnership in Missouri is not a separate legal entity, so the business income and losses are passed through to the partners and reported on their individual tax returns.
What paperwork is required to form a general partnership in Missouri?
To form a general partnership in Missouri, you must file a Certificate of Partnership with the Missouri Secretary of State and create a partnership agreement that outlines the terms of the business.
Are there any annual fees I need to pay for my partnership in Missouri?
No, there are no annual fees required for a general partnership in Missouri.
Do I need to register my general partnership in Missouri with the IRS?
Yes, general partnerships in Missouri must register with the IRS and obtain an Employer Identification Number (EIN).

Also Read

Why Create General Partnership Missouri is So Important

One of the main reasons why creating a general partnership in Missouri is so important is that it allows for shared decision-making and responsibility. In a partnership, two or more individuals come together to run a business, combining their skills, ideas, and resources. This collaborative approach can result in better problem-solving, increased creativity, and more diverse perspectives, all of which can be crucial for the success of a business.

Furthermore, general partnerships in Missouri offer increased flexibility when it comes to management and operations. Unlike corporations, which have a more rigid structure and require formal meetings and records, partnerships allow for a more informal approach to decision-making and day-to-day operations. This can be especially beneficial for businesses that are just starting out and need the freedom to adapt and evolve as they grow.

In addition to shared decision-making and flexibility, creating a general partnership in Missouri also offers potential tax benefits. Partnerships are “pass-through” entities, meaning that the profits and losses of the business are passed through to the individual partners and reported on their personal tax returns. This can result in lower overall tax liability for partners, as they are only taxed once on their share of the business’s profits.

Another important aspect of creating a general partnership in Missouri is the ease of formation and low cost involved. Unlike corporations, which require elaborate legal processes and documents, partnerships can generally be formed with a simple written agreement between the partners. This can save time and money, allowing business owners to focus on actually running their business instead of getting bogged down in legal paperwork.

Finally, creating a general partnership in Missouri can also help build a strong foundation for the business and its relationships. Partnerships require a high level of trust, communication, and collaboration between partners, which can help foster a positive working environment and set the stage for long-term success. By formalizing their partnership through a written agreement, partners can clarify their roles, responsibilities, and expectations, reducing the potential for disputes or misunderstandings down the road.

Overall, creating a general partnership in Missouri can be a smart choice for individuals looking to start a business with someone else. From shared decision-making and flexibility to potential tax benefits and ease of formation, partnerships offer a wide range of advantages that can help set businesses up for success. By taking the time to establish a solid partnership structure, business owners can lay the groundwork for a successful and sustainable business venture.

Conclusion

In conclusion, starting a general partnership in Missouri may effectively combine resources, expertise, and creativity to achieve your mutual business goals. By understanding the legal requirements, drafting a thorough partnership agreement, and registering your partnership, you’ll be well on your way to a successful collaboration. As you embark on this exciting journey, remember to maintain open communication and stay committed to the shared vision that inspired your partnership in the first place.

Leave a Comment