Can I recoup my initial investment in a partnership?

UPDATED: Oct 1, 2022

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Can I recoup my initial investment in a partnership?

I started a verbal partnership. I put up the cash to fund the payroll until the

business was able to sustain the payroll. My partner used his business license.

We both work the business. In a 50/50 partnership in this case, is the investment

capital part of the 50/50 partnership or is the profit and lost part of the 50/50


Asked on October 15, 2018 under Business Law, Florida


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 4 years ago | Contributor

When you invest in a business in exchange for a share or ownership interest in the business, as was the case here (it made you a 50-50 partner), you do not have a right to reimbursement or recoupment of the investment: it was an investment, in exchange for ownership, not a loan. You are entitled to participate 50-50 in the profit (if any) from the company, and could get a 50% share of any losses to use as a tax deduction (speak to your tax preparer or CPA about this).

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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