Free 50/50 Partnership Agreement Template

A 50/50 Partnership Agreement is a legal contract between two individuals who decide to go into business together. 

This agreement outlines the terms and conditions of the partnership, including the division of:

• Profits 

• Responsibilities

• Decision-making power

It should specifically state each partner’s responsibilities in the business and who makes certain choices when circumstances arise such as the need to hire or fire an employee or making a sale. 

Costs and any damages that may occur would also be shared equally between the two partners. 

Create your own agreement in minutes with our 50/50 Partnership Agreement template.

How Does It Work

Unlike other Partnership Agreements, a 50/50 Agreement will almost always be limited to only two parties. 

When created correctly, it clearly outlines what each partner is responsible for, and that they share the expenses and profits of the business. 

Although the name includes 50/50, it’s not necessary to make every aspect of the partnership exactly equal. 

How your responsibilities are shared can be decided by you and the other party involved. 

If you’re interested in starting a business, and would like to work with someone else, then it’s essential to know when to use a 50/50 Partnership Agreement. 

It’s a good idea to use this type of agreement whether you know your partner well or not. If your future business partner is someone you know really well, it may be easier to agree on terms.

Using a 50/50 Partnership Agreement is even more critical when you don’t know your future partner that well. 

In either case, creating the document is a huge advantage for business partners because it helps avoid future misunderstandings. 

With a Partnership Agreement, you can: 

• Make sure that each partner has access to the business

• Create a conflict resolution plan

• Set expectations for income 

• Receive a minority share 

When you create a 50/50 Partnership Agreement and include these details you’ll save yourself from future disputes with your partner. 

Creating clear and concise terms for your Partnership Agreement will help you and your partner successfully share the responsibilities and profits of your business. 

To properly draft your document simply follow the steps below. 

1. Include the details of each partner: Write details including each partner's name and contact information.

2. Add the partnership information: Provide the business's name, the address it is located at, and the start date of your partnership. 

3. Provide investment details: Include how much each partner will invest, which is normally done 50/50. 

4. Establish accounts: Determine that each partner will have separate capital and income accounts.

5. Settle profits and losses: Mention how profits and losses are shared based on percentages of net profits and losses. 

6. Include partner’s salaries and drawings: Mention if you or your partner will have a salary, and how you can withdraw profits from another account. 

7. Mention where books are kept: Include where the partnership’s records will be stored. 

8. Reference how the partnership can end: Include how the partnership may end, by dissolution, withdrawal, etc., and what procedures to take.  

It’s also important to ensure the business or company you choose is not already trademarked in your state. 

It’s crucial to get these steps correct and include all necessary information, which is why it’s recommended to create an agreement with an ordinary or even Small Business 50/50 Partnership Agreement template. 

While a 50/50 Partnership Agreement may seem like a safe bet, it’s not always the best legal form to use in every situation. 

To help you understand what the benefits and negatives of this agreement are you can refer to the following table.

While negative situations may arise when operating a business with a partner, they can be avoided if you plan ahead, always communicate, and have all terms clearly defined.

One of the best ways to fully understand how to structure your Partnership Agreement is to look over a completed example. 

Review the following example to help you create a well-written agreement.

When creating a business there are other legal contracts and forms that you will need to use. 

• Partnership Agreement

• Business Plan

• Employee Contract

• Consulting Agreement

• Job Application Form

You can use these business-related documents when you are running a business, alone or with a partner.