Liquidation of a limited partnership
July 25, 2019 | 25,00 EUR | answered by Steuerberater Knut Christiansen
A limited partnership is being liquidated. There is a general partner and a limited partner. Both have capital accounts. The general partner has a negative balance, while the limited partner has a positive one. If the partnership agreement does not specify, does the general partner have to contribute money to the partnership and the limited partner receive payment from their positive capital account, or do the capital accounts not matter and only the remaining assets are divided proportionally between the two partners?
Good evening and thank you for your inquiry, which I would like to answer as part of an initial consultation and based on your fee.
The general partner must balance his negative capital account due to his function, as this is usually caused by losses. The limited partner receives payment from his positive capital account.
I hope this answers your inquiry, otherwise feel free to ask for further clarification at no cost.
Best regards,
Knut Christiansen
Tax consultant
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