RealTown Words

An association of two or more persons who carry on a business for profit as co-owners as defined in the Uniform Partnership Act, in force in a majority of states. Under this act, a partnership can hold title to real property in the name of the partnership, holding by tenancy in partnership. An advantage to this form of ownership is that the partnership itself does not pay taxes. It must file a partnership information return (Form 1065) showing how much income it distributed to each partner. Each partner, however, is responsible for paying his or her own tax.

A partnership can maintain a real estate broker’s license, provided all partners who actively participate in the real estate brokerage business hold their individual real estate broker’s licenses.