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Forming A Limited Partnership
1. Consult with all prospective partners and designate in writing who will be the general partner and the limited partners. An LP (Limited Partnership) can consist of one or more general partners, and one or more limited partners. It's important to define who are the general partners because they have control over partnership affairs and make decisions regarding partnership issues, as well as have unlimited liability for partnership debts and obligations.
2. Fill out a Certificate of Limited Partnership (CLP) to file with the state where the limited partnership is to be created. You will file the CLP with the secretary of state's office once it has been completed and signed by the various partners. Fees vary from state to state so be sure to contact the secretary of state's office to know what fees apply.
3. Collect the funds from the various partners according to what was agreed to in the outline of the partnership before filing. There is no stock sold within the LP. Instead, units are sold. Each unit is sold for a flat price to each of the partners. The proceeds from selling these units will fund the LP so that you can open a brokerage account on behalf of the LP to begin trading stocks for your partners.