You hi, I'm Alexander with the Entrepreneurship law firm, and this is the Business Killing Mistakes Block. One area where there is great potential for business killing mistakes is in partnerships. Partnerships are difficult, but if done properly, they can really bring substantial benefit to your business. So, the key with a partnership is to get a written agreement with your partner right out of the gate. It's important to plan for the exit because, as I tell people, you're going to leave your business one day. You might leave it vertically or horizontally, but I can guarantee that you're going to leave your business. So, the key is to plan for the departure of the partners at the time that you get into the business. Now, this is pretty important because if you think about it, there are a couple of ways a partner can leave. A partner can leave while they're living – maybe they retire or maybe they just can't do the business anymore. Or, they can leave after they've obviously deceased and are gone. As a partner in the business, you want to make sure that your family gets the value of the business - the value that you've created in the business - if you pass away. Additionally, you want to ensure that you get the value of the business if you decide to move on. The countervailing argument, the other side of this deal, is that the business might not have the cash to pay a partner who leaves or if the partner dies. So, there are a couple of things that these agreements need to include. First, they absolutely, positively need to include insurance on the partners' lives. This is the only way that each of the partners can be sure that their families, their...
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Video instructions and help with filling out and completing Are Form 8865 Partnership
