DBA or General Partnership? No Written Agreement

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Question:

I have an account titled persons personal name with hotel behind the name. The tax number is the same as the persons name. However, I just recently found out that there is a silent partner. They have no written agreement for formal terms regarding this account. Would this be a DBA account or general partnership even though there is not a written agreement? I need to send out a new signature card and am not sure how to handle this situation.

Answer:

In general, a sole proprietorship must be owned by one individual. If another individual has an ownership interest, it's typically considered a partnership unless a more formal structure (LLC, corporation, for example) has been established. This is a state law issue, however, and you should check with legal counsel if you're unsure of what state law has to say on the question.

First published on BankersOnline.com 12/3/12