The basic difference between a partnership and a corporation is that in partnerships the company is controlled/managed by its owners, while in corporations ownership is separated from management. It means that in case of bankruptcy, owners (shareholders) of a corporation will be held responsible for the corporation's debt obligations, while owners of a partnership will have a limited liability for the company's debts and will face the risk of losing only company's assets, but not their personal assets.

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The first sentence is correct, however, the facts are turned around in the second sentence: it is a corporation which has limited liability, not a partnership.

The Basic Difference Between a Partnership and a Corporation Is