Limited Partnership Interest Transfer and Assignee Admission in Arizona

At a glance

Requirements one by one

Assignment and distribution right

Section 29-301(10) defines a partnership interest as a partner's profit-and-loss share and right to receive distributions; § 29-339 calls it personal property. Under § 29-340, the agreement can alter the default, but an interest otherwise may be assigned in whole or part. Assignment alone neither dissolves the limited partnership nor gives the assignee partner powers. The assignee receives only the distributions assigned.

Admission

Section 29-342(a) permits an assignee, including a general partner's assignee, to become a limited partner if the assignor grants that right under authority in the agreement or all other partners consent. Section 29-317(B)(2) requires exercise of the grant and compliance with its conditions. The direct-acquisition rule in § 29-317(B)(1) is a separate route; § 29-317(A) states when a person becomes a limited partner.

What trips people up

A full assignment changes the assignor's status by default. Under § 29-340 the assignor ceases to be a partner after assigning the entire interest unless the agreement provides otherwise. Section 29-342(C) still preserves the assignor's liabilities to the partnership under §§ 29-314 and 29-328 after assignee admission.

Admission carries limited-partner obligations. Section 29-342(B) makes the admitted assignee responsible for the assignor's make-and-return contribution obligations, but protects the assignee from liabilities unknown at admission. Section 29-328(A) requires a limited partner's enforceable contribution promise to be signed in writing.

Partnership records set a later admission date. Section 29-317(A) names formation or a later time specified in the partnership records. Sections 29-340 and 29-342 do not prescribe a separate transfer-notice or public-filing step.

Common questions

Does a general partner's assignee automatically become a limited partner? No. Section 29-342(A) expressly includes that assignee but still requires the agreement-authorized grant or all-other-partner consent.

Can an assignee inspect records before admission? Assignment alone grants no partner rights under § 29-340. Section 29-321 grants inspection to limited partners.

Statutes and sources

• Ariz. Rev. Stat. § 29-301: “10. "Partnership interest" means a partner's share of the profits and losses of a limited partnership and the right to receive distributions of partnership assets.” (official section; accessed October 2, 2026).
• Ariz. Rev. Stat. § 29-317: “A. A person becomes a limited partner: 1. At the time the limited partnership is formed; or 2. At any later time specified in the records of the limited partnership for becoming a limited partner. B. After the filing of a limited partnership's original certificate of limited partnership, a person may be admitted as an additional limited partner: 1. In the case of a person acquiring a partnership interest directly from the limited partnership, upon the compliance with the partnership agreement or, if the partnership agreement does not so provide, upon the written consent of all partners; and 2. In the case of an assignee of a partnership interest of a partner who has the power, as provided in section 29-342, to grant the assignee the right to become a limited partner, upon the exercise of that power and compliance with any conditions limiting the grant or exercise of the power.” (official section; accessed October 2, 2026).
• Ariz. Rev. Stat. § 29-321: “Each limited partner has the right to: 1. Inspect and copy any of the partnership records required to be maintained by section 29-305; and 2. Obtain from the general partners from time to time upon reasonable demand: (a) True and full information regarding the state of the business and financial condition of the limited partnership; (b) Promptly after becoming available, a copy of the limited partnership's federal, state and local income tax returns for each year; and (c) Other information regarding the affairs of the limited partnership as is just and reasonable.” (official section; accessed October 2, 2026).
• Ariz. Rev. Stat. § 29-328: “A. A promise by a limited partner to contribute to the limited partnership is not enforceable unless set out in a writing and signed by the limited partner. B. Except as provided in the partnership agreement, a partner is obligated to the limited partnership to perform any enforceable promise to contribute cash or property or to perform services, even if he is unable to perform because of death, disability or any other reason. If a partner does not make the required contribution of property or services, he is obligated at the option of the limited partnership to contribute cash equal to that portion of the value as stated in the partnership records required to be kept pursuant to section 29-305 of the stated contribution that has not been made.” (official section; accessed October 2, 2026).
• Ariz. Rev. Stat. § 29-339: “A partnership interest is personal property.” (official section; accessed October 2, 2026).
• Ariz. Rev. Stat. § 29-340: “Except as provided in the partnership agreement, a partnership interest is assignable in whole or in part. An assignment of a partnership interest does not dissolve a limited partnership or entitle the assignee to become or to exercise any rights of a partner. An assignment entitles the assignee to receive, to the extent assigned, only the distribution to which the assignor would be entitled. Except as provided in the partnership agreement, a partner ceases to be a partner upon assignment of all his partnership interest.” (official section; accessed October 2, 2026).
• Ariz. Rev. Stat. § 29-342: “A. An assignee of a partnership interest, including an assignee of a general partner, may become a limited partner if and to the extent that: 1. The assignor gives the assignee that right in accordance with authority described in the partnership agreement; or 2. All other partners consent. B. An assignee who has become a limited partner has, to the extent assigned, the rights and powers and is subject to the restrictions and liabilities of a limited partner under the partnership agreement and this chapter. An assignee who becomes a limited partner also is liable for the obligations of his assignor to make and return contributions as provided in articles 5 and 6 of this chapter. However, the assignee is not obligated for liabilities unknown to the assignee at the time he became a limited partner. C. If an assignee of a partnership interest becomes a limited partner, the assignor is not released from his liability to the limited partnership under sections 29-314 and 29-328.” (official section; accessed October 2, 2026).