Going In With a Friend, and What That Quietly Creates
Sources last read 2026-07-28.
Short answer
If you and a friend run something together and split the money, you have already made a partnership. Nobody signs anything. Nobody has to mean to. Two things come with it. Either of you can commit both of you, and each of you can be chased for the whole debt, not half of it. None of that is a reason not to do it with a friend. It is a reason to agree a few things first, and this page has the list.
You made a thing without noticing
You and a friend sell something together and split what comes in.
That is a partnership. It already exists. There is no form, no fee and no moment where you both agreed to it.
Washington's law says so in one line, printed further down. The key words are whether or not the persons intend to form a partnership. California's law uses the same words.
Two states is not every state. Go and read yours. But this is not an odd rule hiding in one place, and if your state has a version of it, you are in it.
Washington's laws are numbered as the Revised Code of Washington (RCW). The partnership one is 25.05.055.
The two things that come with it
This is the part nobody writing about teenage business ever mentions.
Either of you can commit both of you. A partner acting like a partner, doing the ordinary business of the thing, binds the partnership. Your friend can order stock, promise a customer a date, or agree a price, and it sticks to both of you.
Each of you can be chased for all of it. Not half. The wording used is jointly and severally,
which sounds like nothing and means everything. Washington puts it at 25.05.125, a few sections
along from the one below, and says all partners are liable jointly and severally for all
obligations of the partnership. California's version says the same.
Jointly and severally means somebody owed money can come to either of you for the whole amount. They do not have to split it. They will pick whoever is easier to get it from.
If your friend orders 250 dollars of blank hoodies and vanishes, the supplier is allowed to ask you for the whole 250. Sorting it out with your friend afterwards is your problem, not theirs.
Why this matters more at your age
Two reasons, and they are both boring, which is why they get skipped.
The first is that your business is probably built out of favours. Somebody's dad's van. A pitch at a market booked in one person's name. Kit borrowed and not written down. When it ends, nobody can remember what was whose.
The second is that going into business is exactly the behaviour that closes the exit some people under 18 have from a deal. Washington says the protection is gone once you have engaged in business as an adult. There is a page here on what a contract does when you are under 18, and it goes through that.
So being two of you does not make the deals softer. If anything it makes them harder.
What to agree before it matters
Not a legal document. One page, in your own words, that you both keep a photo of.
The split. Who gets what share, and when it is worked out. Every job, or once a month.
What counts as a cost. Materials come out first, obviously. What about gas, a stall fee, the new blade? Agree now.
Who owns the kit. List anything that cost real money and say whose it is if you stop. Borrowed things go on the list too, with whose parent they belong to.
A spending limit. Neither of you commits the pair of you to more than an agreed amount without the other saying yes. Pick a number. Twenty dollars is a fine number.
Whose name things are in. The selling app, the market booking, the phone number customers have. Somebody's name is on each of those, and for people under 18 an adult often holds the money side. Write down whose, so it is a fact and not an argument.
What happens if one of you stops. People stop. School, sport, a job, losing interest. Decide now what the other one does with the jobs already taken.
How it ends. Written while you still like each other.
That is it. Twenty minutes and a photo each.
An example, to show the shape of it
Quentin is 16 and cuts keychains with a friend. He does the machine, his friend does the selling, and they split whatever is left at the end of each month.
Neither of them ever used the word partnership. They were two people with a spreadsheet.
Then his friend ordered 380 dollars of acrylic sheet from a supplier who bills later. The friend lost interest about three weeks after that. The bill came, and the supplier did not care which of them had clicked the button.
Quentin's dad paid it and Quentin paid him back over the summer. Nobody got sued and nobody enjoyed it.
What they wrote afterwards was one page. Nothing over 20 dollars without both of them agreeing. The machine is Quentin's. The market pitch is in his friend's mum's name. And a line about how they would stop, which they used four months later without a single argument.
The honest summary
Going in with a friend is not a mistake. Most good small things start with two people.
What is a mistake is thinking nothing exists until somebody signs something. It already exists, and it was built the day you split the first payment.
So write the page. Show it to an adult. Then get back to the actual work.
Washington, on how a partnership starts
the association of two or more persons to carry on as co-owners a business for profit forms a partnership, whether or not the persons intend to form a partnership.
Washington, RCW 25.05.055(1)
Look at the last seven words. Whether or not you meant to. There is no form here and no signing. Two people, one business, sharing what it makes, and it exists. California's law says the same thing in the same words. Two states is not proof about yours, so go and look at your own.
The same law, on what counts as being in
A person who receives a share of the profits of a business is presumed to be a partner.
Washington, RCW 25.05.055
Presumed means the law starts by assuming it is true. So the test is not what you called each other. It is whether somebody is taking a cut of the profit. If your friend gets half of what comes in, that is the fact people will look at, not what you told them.
Questions people actually ask
We never signed anything. Does it still count?
That is the point of the wording above. Signing is not what makes it. Running something together and sharing what it makes is what makes it. The paper you never signed was never the trigger.
What if my friend orders something without telling me?
If it looks like normal business for the thing you two run, you can be on the hook for it. That is what one partner being able to commit both means. It is also why the list on this page has a spending limit on it.
Can we just say we are not partners?
Saying it does not settle it, because the law looks at what you are doing. What you can do is agree in writing that one of you owns the business and pays the other for work or for materials. That is a different setup, and it needs to be true, not just written down.
Does a company fix this?
It can, and this is one of the few honest reasons for one. Two people with shared money is the case where a wall between the business and each of you starts to be worth the fee. Read the page here on what a company actually does first, then take it to an adult.
How do we end it without it getting ugly?
By writing down how you end it while you still like each other. Who keeps the kit, who finishes the jobs already taken, how the last money is split. Ten minutes now. It is the part everybody skips and the part everybody later wishes they had.
Where this came from
Washington Legislature, RCW 25.05.055
app.leg.wa.gov
Washington Legislature, RCW 26.28.040
app.leg.wa.gov