In a limited partnership of1 generaland1 limited partner, if the limited sells its interest to the general, does the partnership automatically dissolve?

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In a limited partnership of1 generaland1 limited partner, if the limited sells its interest to the general, does the partnership automatically dissolve?

A limited partnership was created to use tax credits to fund the construction of low income housing. The general partner has agreed to buy the interest of the limited (investor) partner since the tax credit period has ended. Can the general partner dissolve the partnership and claim ownership? How?

Asked on January 26, 2011 under Business Law, Alaska

Answers:

M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

Is there a partnership agreement that was drawn up between you?  Is the partnership registered anywhere?  Although the partnership may theoretically dissolve here if it no longer technically exists, I would worry about my interest and what I wish the end result to be if I did not consult with an attorney and let him or her look at the document that are in place already regarding the matter.  You need to at least draft a sell agreement that will essentially dissolve the partnership agreement between you and then you need to dissolve it with the appropriate state agency that you have it registered with, if any.  Do not take any chances here. You are always playing with a liability issue by taking short cuts. 


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