What is the definition of a general partnership?

• A. General partnership
• B. Corporation
• C. Sole Proprietor
• D. Limited Liability Company

Answer: (A)

A general partnership is formed when two or more people run a business for profit as co-owners, sharing management, profits, and losses. It is not a separate legal entity like a corporation or LLC, so the partners are personally responsible for the partnership’s debts and obligations. Taxes flow through to the partners, who report their share of profits on their own returns. This setup distinguishes it from a sole proprietorship (one owner), a corporation (a separate entity with limited liability for owners), and an LLC (another type of separate entity with liability protection), making it the best match for the definition in the question.