Legal Question in Business Law in Arkansas

Disolveing a partnership

In 2002 I entered a partnership in an existing pest company. Instead of a lump sum buy in, my partner wanted to recieve funds monthly out of company monies for his interest. Should mention this arrangement was for him to be a silent, non working partner with no input on business operations. In addition to his salary which matched mine, and his 50 percent dividend share, he also recieved an $8000.00 a month payment for my buy in. What I wasn't aware of when I agreed to this was my tax liability on half of that payment. We have agreed to end the partership, but my question is do I have a legal right to be reinbursed for the money in which I have been paying taxes on, especially since the partner got the money, not me, I had to pay taxes on what would have been future interest in this company. He has indicated he will not do any kind of buy back settlement. Please advise as to what my rights are.


Asked on 5/10/06, 4:54 pm

1 Answer from Attorneys
Harvey Harris Harris Law Firm

Re: Disolveing a partnership

Was any of your agreement in writing?

I don't understand what you paid taxes on. It sounds like you were paying taxes on money that was going to your partner. One thing you need to do is ask for an accounting in writing from the bookkeeper, whoever that is. As a partner you are entitled to such. Be sure to put that request in writing.

I will be glad to discuss this matter with you to determine whether you have a cause of action for this. But I need more information to understand exactly what you are asking.

For a free consultation, send me an email or give me a call.

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Answered on 5/10/06, 5:55 pm


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