Form 1065 - Us Return Of Partnership Income

Form 1065, also known as the U.S. Return of Partnership Income, is a tax form used by partnerships to report their income, gains, losses, deductions, credits, and other information to the Internal Revenue Service (IRS). This form is used to pass through any profits or losses to its partners, who then report this information on their individual tax returns.

What is Form 1065 used for?

• Reporting income, gains, losses, deductions, credits, and other information of a partnership to the IRS.
• Passing through profits or losses to its partners, who then report this information on their individual tax returns.

Key Takeaways

• Partnerships do not pay taxes on their profits; instead, the partners pay taxes on their share of the partnership's income.
• Form 1065 is used to report the income, deductions, credits, and other items of a partnership.
• The partnership allocates these items to each partner based on their ownership interest using Schedule K-1.

Filing Requirements:

• Form 1065 must be filed by the 15th day of the third month after the end of the partnership's tax year.
• Partnerships can obtain an automatic six-month filing extension to September 15.
• Failure to file Form 1065 on time can result in a penalty of $220 per partner for each month the return is late.

Why File Form 1065?

• Form 1065 is necessary for partnerships to report their income, deductions, credits, and other items to the IRS.
• It allows partners to report their share of the partnership's income on their individual tax returns.
• Failure to file Form 1065 can result in penalties and fines.

What if You Don't File Form 1065?

• If you don't file Form 1065, the IRS will levy a penalty of $220 per partner for each month the return is late.
• Failure to file Form 1065 can also lead to audits and fines.

The Bottom Line

• Form 1065 is a necessary tax form for partnerships to report their income, deductions, credits, and other items to the IRS.
• It allows partners to report their share of the partnership's income on their individual tax returns.
• Failure to file Form 1065 can result in penalties and fines.