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The Indiana partnership agreement is a legal document that outlines all the rules under which the partners will operate their business partnership.
Although the partnership agreement, or partnership contract, is not always required in a certain state for the formation of the business, the parties often choose to make one since the federal and state laws that regulate partnerships don’t provide many details and often leave it to partners to provide detailed rules of their operation.
Therefore, the partners often choose to draft the partnership agreement to further specify the framework for their operation and prevent future misunderstandings and disputes between them.
The Indiana partnership agreement has a few synonyms that are also used in practice, such as “partnership deed” and “articles of partnership.”
Indiana Partnership Agreement Types
In Indiana, there are several types of partnership agreements that partners can choose from:
Types of Partnership Agreement
General Partnerships (GP): This type of partnership enables all partners to participate in the decision-making process. However, they are all responsible for the business liabilities with all of their personal assets. (§ 23-0.5-1.5-13)
Limited Partnership (LP): This is a partnership between the general partners, who have decision-making powers but are fully liable for the partnership operations with their personal assets, and the limited partners, who have limited liability and decision-making powers. (§ 23-16-3-1 — 23-16-3-14)
Limited Liability Partnership (LLP): With this type, all partners are able to make decisions equally, but their liability is limited only to the decisions they have personally made. (§ 23-4-1-45)
Indiana Partnership Agreement Requirements
In Indiana, the partnership agreement format will include the following elements:
Mandatory Requirements
Information about the partners
Name and registered address of the partnership
Date of partnership formation and dissolution
Information on each partner’s contribution
Information about each partner’s management rights
Rules on profit distribution
Details on how the partners will cover eventual losses