RS 01802.310 When to Develop Partnerships
A. OPERATING POLICY
A partnership is a valid form of business operation, and its use does not automatically raise a question about SEI derived through it.
Development must be undertaken and the results documented when:
A question is raised, by or on behalf of a person who worked in the business, as to whether he or she should receive credit for any part of the earnings reported by another, i.e. husband/wife business operation with all earnings reported to the husband. Note: this issue should be raised before denying a claim for lack of insured status;
Some one appears to be using the partnership form to acquire Social Security coverage through the efforts of another;
An individual, formerly the sole proprietor of a business, within several years of applying for benefits forms a partnership to operate the business, thereby dividing NESE and reducing his net income;
A limited partner appears to be reporting as SEI his distributive share of income from a limited partnership.
The above is not intended to preclude development when in the judgement of the adjudicator there is reason to question whether a business was or was not a partnership, or whether income was properly reported.