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What factors indicate a partnership or joint venture?

Excerpted from "Social Security Handbook". See the up-to-date, official Social Security Handbook at ssa.gov.

1108. What factors indicate a partnership or joint venture?

The following factors indicate a partnership or joint venture:

  1. An intent on the part of two or more people to join together in good faith to carry on a trade or business;

  2. Contribution of capital or services to the business by each party;

  3. A sharing of the right to participate in management decisions and other responsibilities;

  4. A sharing in the profits and risk of loss in accordance with the parties' agreement; and

  5. Neither person is an employee of the other.

All of these basic factors must be present for an arrangement to be considered a partnership.

Last Revised: March, 2001


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