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Partnership + Return of Capital Question

Trevor  Hodges's Profile

I'm looking at a partnership agreement where each limited partner has invested a set dollar amount and specifies a 90%/10% split in profits between investor/partnership management until the profit for each limited partner reaches their investment amount. Afterwards, the split is 50/50. My question is with regards to return of capital. It appears that the partnership managers, when applying the return of capital, have applied the 90/10 and 50/50 rules to that capital. Should the split in profit be applied to the return of capital? Or should the capital be returned in full without having the profit split applied to it?


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