How to Start a General Partnership in Nevada (2025 Guide + Why Nevada LLCs Are Better)

By Jake Lawson | Updated January 2025

Here’s my honest assessment: I’ll walk you through exactly how to form a General Partnership in Nevada, but I’m also going to explain why it’s likely the wrong choice for your business – especially in a state as business-friendly as Nevada.

After helping 1,200+ entrepreneurs launch businesses across all 50 states, I’ve encountered maybe 25 situations where a General Partnership actually made sense. The rest of the time, people choose partnerships because they think it’s “simpler” or “cheaper” – then discover they’ve exposed their personal assets to unlimited liability for the sake of saving $425.

Here’s the complete Nevada General Partnership guide, plus why a Nevada LLC is almost certainly the smarter choice for your business.

What Is a General Partnership in Nevada?

A General Partnership in Nevada is the most basic multi-owner business structure. Under Nevada’s Uniform Partnership Act (Chapter 87), when two or more people agree to operate a business together for profit, they automatically create a General Partnership – whether they file any paperwork or not.

There’s no formal registration required with the Nevada Secretary of State. No Articles of Organization to file. No upfront state filing fees to pay. You and your partner shake hands, agree to start a business, and you’re legally operating as a General Partnership under Nevada law.

Here’s the massive catch: Every partner has unlimited personal liability for all partnership debts and obligations. Your partner makes a bad decision? You’re personally liable. Business gets sued? They can come after your house, retirement accounts, and personal savings.

The Nevada General Partnership Reality Check

Let me break down what you’re actually getting with a General Partnership in Nevada:

The Supposed Advantages:

• No state formation costs: No Secretary of State filing fees required
• Pass-through taxation: Profits and losses flow through to partners’ personal tax returns
• No state income tax: Nevada doesn’t tax partnership income (this applies to LLCs too)
• Operational flexibility: Partners can make binding decisions (this cuts both ways)
• Simple startup: Just an agreement between partners

The Serious Disadvantages:

• Unlimited personal liability: All partners personally liable for all business debts
• Joint and several liability: One partner’s mistakes become everyone’s problem
• No business credit separation: Business debts tied to personal credit
• Banking challenges: More difficult to open accounts and establish business credit
• Professional credibility: Less trusted than LLCs by vendors, clients, and lenders

The Nevada-Specific Complications:

• State Business License required: Nevada mandates a State Business License for partnerships
• County DBA filing: Must file fictitious name with county clerk
• Annual license renewal: State Business License must be renewed annually
• Higher compliance costs: License fees and renewals add ongoing expenses

After 15 years in business formation, here’s my assessment: General Partnerships are outdated structures that create more liability than they’re worth, especially when Nevada LLCs provide the same tax benefits with complete asset protection.

How to Form a General Partnership in Nevada (Complete Process)

Despite my strong reservations, here’s exactly how to create a General Partnership in Nevada:

Step 1: Partnership Foundation and Strategic Planning

Choose Your Partners with Extreme Care This is literally the most critical decision you’ll make. You’re about to become personally liable for their business decisions. Carefully evaluate:

• Their business experience and track record
• Financial stability and credit history
• Work ethic and decision-making abilities
• Compatible vision and values
• Communication style and conflict resolution skills

Establish Clear Ownership and Management Structure 

Define exactly how you’ll handle:

• Ownership percentages (doesn’t have to be equal)
• Profit and loss allocation methods
• Capital contributions from each partner
• Management responsibilities and authority levels
• Decision-making processes and voting requirements

Define Your Business Parameters 

Clarify your:

• Industry focus and NAICS code
• Business model and revenue streams
• Target market and competitive strategy
• Primary business address (can be home address)
• Initial capital requirements and funding sources

Step 2: Create a Comprehensive Partnership Agreement

This is absolutely essential, even though Nevada doesn’t require it. A Partnership Agreement protects all partners and establishes operational framework.

Critical Elements to Include:

Financial Structure:

• Each partner’s initial capital contribution amount
• Profit and loss distribution percentages
• Additional funding procedures and responsibilities
• Partner compensation and draw policies
• Expense reimbursement and approval processes

Management and Operations:

• Decision-making authority and voting procedures
• Daily management responsibilities and limitations
• Authority limits for individual partners
• Meeting requirements and record-keeping procedures
• Business banking and financial management protocols

Legal Protections and Exit Strategies:

• Dispute resolution mechanisms and procedures
• Partnership dissolution and wind-up procedures
• Buy-sell provisions for partner departure or death
• Non-compete and confidentiality agreements
• Disability, bankruptcy, and succession planning

Operational Framework:

• Business purpose and scope limitations
• Partner time commitments and performance standards
• Client relationship management and ownership
• Intellectual property creation and ownership

Step 3: Handle Required Business Registrations

Obtain Your EIN (Employer Identification Number) All General Partnerships must have an EIN for tax filing purposes. Apply directly through the IRS website – it’s completely free and takes about 10 minutes.

Critical scam warning: The IRS never charges for EINs. Anyone requesting payment is running a scam.

Register a Fictitious Firm Name (DBA) if Needed Nevada requires DBA registration at the county level if you operate under any name other than the actual names of all partners.

Nevada DBA Process:

• File with County Clerk or Recorder in your operating county
• Fees vary by county (typically $25-75)
• Required for banking and business operations
• Must renew periodically (varies by county)

Examples:

• “Smith and Jones General Partnership” – may not need DBA
• “Silver State Marketing Solutions” – DBA required

Step 4: Obtain Required Business Licenses

Nevada State Business License (Required) Unlike most states, Nevada requires all General Partnerships to obtain a State Business License:

• Annual fee varies by business type and revenue
• Must be renewed annually
• Required before conducting business in Nevada
• Penalties for operating without license

Additional Licenses: Research industry-specific and local licensing requirements 

Professional Licenses: Individual licensing for certain professions

Smart move: Hire a professional licensing research service like LegalZoom or IncFile ($100-200) to ensure complete compliance. Nevada has complex licensing requirements that are easy to miss.

Step 5: Establish Business Banking and Accounting Systems

Open a Business Bank Account Separate business and personal finances from day one. Most Nevada banks require:

• Partnership Agreement signed by all partners
• EIN confirmation letter from IRS
• DBA certificate (if applicable)
• Personal identification for all partners
• Initial deposit and minimum balance requirements

Implement Accounting Systems Set up bookkeeping to track:

• Partnership income and business expenses
• Individual partner capital accounts and contributions
• Profit and loss allocations by partner
• Tax document preparation and filing
• Business expense categorization and reporting

Step 6: Understand Tax Obligations

Nevada General Partnerships must:

• File Form 1065 (informational return) with IRS
• Issue Schedule K-1 to each partner showing their share
• No Nevada state income tax on partnership income
• Handle quarterly estimated tax payments for partners
• Maintain detailed financial records for tax compliance

Nevada tax advantage: No state income tax on partnership income, same as Nevada LLCs.

Nevada General Partnership vs. LLC: The Honest Comparison

Here’s the real cost-benefit analysis:

Formation Costs:

• General Partnership: $0 state fees (plus county DBA fees ~$50, State Business License ~$200+)
• Nevada LLC: $425 filing fee

Real difference: $175-275 to get complete liability protection

Ongoing Costs:

• General Partnership: State Business License renewal annually (~$200+), DBA renewals
• Nevada LLC: $325 annual List of Managers fee

Annual difference: Roughly similar ongoing costs

Liability Protection:

• General Partnership: Zero protection – unlimited personal liability
• Nevada LLC: Complete protection of personal assets

Tax Treatment:

• General Partnership: Pass-through taxation, no Nevada state income tax
• Multi-Member LLC: Identical pass-through taxation, no Nevada state income tax

Bottom line: For $175-275 more upfront, you get the same tax benefits plus complete liability protection. This is the best business investment you’ll ever make.

Why I Rarely Recommend General Partnerships

After tracking hundreds of Nevada business formations, here are the real-world problems I see:

The Liability Horror Stories:

• Partner’s vehicle accident during business: All partners’ personal assets at risk
• Customer injury at business location: Partners’ homes subject to judgment
• Vendor payment dispute escalation: Personal credit scores damaged
• Partner embezzlement discovery: Remaining partners still liable for business debts
• Professional malpractice claim: All partners’ personal wealth exposed

The Professional Credibility Problems:

• Banking difficulties: Establishing business credit is challenging
• Vendor relationships: Suppliers hesitant to extend favorable terms
• Client perception: General Partnerships appear less established
• Insurance complications: More difficult and expensive to obtain business insurance
• Investment barriers: Nearly impossible to attract outside investment

The $275 Question:

Is saving $275 in LLC filing fees worth risking your house, retirement savings, and financial future? I’ve never met an entrepreneur who thought so after understanding the real risks.

When General Partnerships Actually Make Sense

In my 15 years of experience, General Partnerships work in these very limited situations:

1. Very short-term projects (under 90 days)
2. Extremely low-risk service businesses with minimal liability exposure
3. Testing business partnerships before formal entity formation
4. Family businesses where all partners have identical financial exposure
5. Specific professional practices where Nevada law requires partnership structures

Even in these rare cases, I usually recommend Nevada LLCs for the minimal additional cost and maximum protection.

The Smart Alternative: Nevada Multi-Member LLC

Instead of a General Partnership, consider a Nevada Multi-Member LLC:

Formation Process:

1. Choose LLC name and verify availability through Nevada Secretary of State
2. File Articles of Organization with Nevada Secretary of State ($425)
3. Create Operating Agreement (similar to Partnership Agreement but with liability protection)
4. Obtain EIN from IRS (free)
5. Get Nevada State Business License (same requirement as partnerships)
6. Open business bank account (easier than with partnerships)

Nevada LLC Advantages:

• Liability protection: Personal assets protected from business debts and lawsuits
• Same tax treatment: Identical pass-through taxation as partnerships
• No Nevada state income tax: Same tax benefit as partnerships
• Professional credibility: Banks, vendors, and clients understand and trust LLCs
• Operational flexibility: Customize management structure to fit your needs
• Easy banking: Simpler to open accounts and establish business credit
• Investment ready: Much easier to bring in investors or sell ownership interests later

Total Additional Cost:

$175-275 more than General Partnership for complete liability protection

This represents the best return on investment in business formation.

How to Convert a Nevada General Partnership to LLC

Already have a General Partnership and want to upgrade? Here’s the conversion process:

1. Form the new Nevada LLC following standard formation procedures
2. Transfer partnership assets to the LLC (may require new contracts and agreements)
3. Update all business relationships to reflect LLC ownership structure
4. Close partnership tax accounts and open LLC tax accounts
5. Transfer State Business License to the LLC name
6. Notify banks, vendors, and customers of the entity change
7. File final partnership tax return and begin LLC tax filings

Tax considerations: Consult with a Nevada CPA about potential tax implications of the conversion, though most conversions are tax-neutral events.

Nevada Business Structure Recommendations

Based on your situation, here’s what I typically recommend:

Single Owner:

• First choice: Nevada Single-Member LLC ($425)
• Alternative: Sole Proprietorship (only if extremely low risk)

Multiple Owners:

• First choice: Nevada Multi-Member LLC ($425)
• Alternative: Nevada Corporation (if seeking significant investment)
• Avoid: General Partnership (unless very specific circumstances)

High-Growth Ventures:

• Delaware LLC or Corporation (if seeking venture capital funding)
• Nevada Corporation (if staying local but scaling rapidly)

Privacy-Focused Businesses:

• Nevada LLC (strong privacy protections available)
• Wyoming LLC (maximum anonymity possible)

Nevada-Specific Business Advantages

State Business Environment:

• No state income tax on business or personal income
• Business-friendly legal framework and court system
• Strong privacy protections available
• Pro-business regulatory environment

Geographic Benefits:

• Access to California markets without California taxes
• Growing tech and startup ecosystem in Las Vegas and Reno
• Central location for western U.S. operations
• Strong tourism and hospitality industry

Tax Considerations:

• No franchise tax on LLCs (though annual List of Managers fee applies)
• No state income tax on pass-through entities
• Various business incentive programs available
• Favorable tax treatment for holding companies

Frequently Asked Questions

Do I need to register my General Partnership with Nevada?

No, General Partnerships exist automatically when partners agree to do business together. However, you must obtain a Nevada State Business License and may need county DBA registration.

Can one partner make binding decisions for the partnership?

Unless your Partnership Agreement specifies otherwise, any partner can make decisions that legally bind the partnership and all other partners. This is why unlimited liability is so dangerous.

What happens if a partner wants to leave the business?

Without a Partnership Agreement, the partnership may legally dissolve. Proper agreements establish buy-out procedures and business continuation terms.

How are partnerships taxed in Nevada?

Partnerships file Form 1065 (informational) with the IRS and issue K-1s to partners. No Nevada state income tax applies to partnership income.

Can we add new partners later?

Yes, but all existing partners must agree to the addition. You’ll need to update your Partnership Agreement and potentially your business licenses.

What if partners have major disagreements?

Without a Partnership Agreement specifying dispute resolution procedures, disagreements can paralyze or dissolve the business. Comprehensive agreements are essential.

Is a Nevada LLC really worth the extra $275?

Absolutely. The liability protection alone is worth thousands of times the additional cost, and you get identical tax benefits with better professional credibility.

Do I need a Nevada State Business License for my partnership?

Yes, Nevada requires all General Partnerships to obtain and maintain a Nevada State Business License. This is not optional.

The Bottom Line on Nevada General Partnerships

General Partnerships are simple to form but create enormous personal risk for minimal cost savings. With Nevada’s excellent business climate and LLC-friendly laws, there’s rarely a good reason to choose unlimited liability over complete asset protection.

My advice after 1,200+ business formations: Invest the extra $275 and form a Nevada LLC. The liability protection is worth far more than the minimal additional cost, you get identical tax benefits (including no state income tax), and you’ll have significantly better professional credibility with banks, vendors, and clients.

If you’re absolutely determined to form a General Partnership, follow the steps in this guide and make sure you have a comprehensive Partnership Agreement. But seriously consider whether saving $275 is worth exposing your personal assets to unlimited business liability in a state that makes LLCs so accessible and affordable.

Ready to form a Nevada LLC instead? I’ve created a comprehensive Nevada LLC formation guide with step-by-step instructions, cost breakdowns, and my tested service provider recommendations. Get the complete Nevada LLC guide here.

Still have questions about Nevada business structures? I personally respond to every entrepreneur navigating business formation decisions. Contact me directly – I’ll help you choose the structure that actually protects your interests.

Want professional help with Nevada LLC formation? I’ve tested every major service and recommend Northwest Registered Agent for their excellent customer service and privacy protection features. They’ll handle your Nevada LLC formation professionally and include registered agent service.

Jake Lawson is an LLC formation strategist who has guided over 1,200 entrepreneurs through U.S. business formation across all 50 states. He founded llciyo.com to provide unbiased, experience-based guidance for business structure selection and formation.