Different contributor here. Please permit me to assist.
If the business
is a "general partnership
," which means a partnership
that is not
created under the umbrella of a separate legal entity registered with the state, such as an LP, LLP
, or Inc., then the bankruptcy
will be treated approximately the same as a personal bankruptcy, and everything will flow through to the individual partners.
Otherwise, the two issues will remain completely separate -- with one important exception: if a partner in a legal entity has made a personal guarantee of some debt incurred by the partnership, then the creditor can simply ignore the bankruptcy and attempt to collect from the personal guarantor.
So, there are a few twists and turns here that could change the answer all the way from "no liability" to "total liability."
Let me know if I can clarify anything for you.
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