You want to buy (or buy-in to) some commercial property. One of you has the cash, the other of you has the sweat. Can your sweat equity count as a capital contribution?
Of course it can, but the question is whether you want it to. Because the partnership is taxed based upon its value. And if you impute value to the sweat equity, there’s more equity which means more value which means more taxes. For both of you.
If you’re talking an LLC, this article highlights some of the possible work-arounds. And if you’re talking a stock entity (whether S or C corp), this article helps you sort it out. The common theme in both articles? Make sure you have good advice in your corner.