• Joseph Dragon

Partnerships in Nevada. NRS Chapter 87


A partnership in Nevada, NRS 87, is “two or more people in business for profit.” The definition simply means that if two or more people enter into a business with one another, then a partnership is formed.


Partnerships are distinct from every other legal entity because they are not actually an entity. The law deems people who are in business with one another as partnerships, but no official filing with the Nevada Secretary of State is required. This type of situation is common in all areas of law. For instance, imagine that Josh is married to Liz. Josh and Liz have a son, John. Because Liz gave birth to John, the law deems Josh is John's father simply by Liz giving birth, and no further action is required. In other words, there is no requirement that Josh file John's birth certificate with the Nevada Secretary of State's office.


Partnerships are never recommended to conduct business. If a business is running under a partnership, the business does not enjoy limited liability and does not have the same legal protection. A business owner at the very least must form an entity before starting a business.


Consider the following story to understand why. Jill and John are chefs in Las Vegas. After working long hours at high-end casino restaurants, they decide to start their own restaurant. They pool their resources, take out a lease on a building, purchase restaurant equipment, hire employees, and begin.


Six months later the restaurant is doing well. On a busy Friday night, a patron, Lisa, slips on spilled honey which should have been cleaned up by an employee (“Tim”) hours ago. Tim is an alcoholic who lied on his job application about being terminated from previous employers for his alcohol issue. Tim did not clean up the honey because he was drunk and forgot. Lisa tears her ACL, sues, and the restaurant is liable. To make matters worse, the lawsuit forced Jill and John to front money for legal fees. They get behind on their bills, their landlord sues, and their suppliers sue as well.


Because they are a simple partnership, both are them are personally liable to Lisa, their landlord, and their suppliers. They are unable to withstand the financial pressure, file for bankruptcy and are unable to obtain a business loan for the next seven years, forcing both back to the Las Vegas Strip for income.


Understand the point: never under any circumstances begin a business without forming a Business Entity.


Please note: the contents found on this website are not legal advice and is strictly intended for educational purposes only. The legal needs of each individual vary significantly and are dependent on a variety of factors relevant to their specific needs. Please Contact Us if you have any questions about this topic or would like to Schedule a Free Consultation.




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