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What Information Do I Need to File Form 1065 for a Partnership?

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Question: What Information Do I Need to File Form 1065 for a Partnership?
Form 1065 is the U.S. Return of Partnership Income. This form is complicated, and you should have a competent tax preparer complete the form. But you can save time and money by gathering information to make preparation easier.

A partnership pays income tax through the returns of its partners, allocating share of income or loss to each partner according to the terms of the partnership agreement. The partnership files an information return on Form 1065, then gives each partner Schedule K-1 showing his or her share of income/loss for the year.

A multiple-member LLC is taxed as a partnership.

Answer:

Before you take your partnership tax information to a tax preparer, gather together the following information:

  • Information about the partnership, including the Employer ID number, business code (NAICS code), and the date the partnership was started.
  • The accounting method used by the partnership - cash or accrual
  • Total gross receipts, returns and allowances
  • If you sell products, information to calculate cost of goods sold
  • Information on partnership expenses, specifically
    • Salaries and wages of employees, but not partners, less any employment credits
    • Guaranteed payments to partners
    • Repairs and maintenance expenses
    • Rent
    • Taxes and licenses
    • Interest paid
    • Depreciation calculation for the year
    • Retirement plans
    • Employee benefit programs
    • Other deductions
  • Information on constructive ownership by partners or the partnership
  • Information on distributions of shares or money to partners, and allocation of income/loss to partners (show separately for general and limited partners)
  • Balance sheet for the partnership at the beginning and the end of the year
  • Total amount of all partner capital accounts, at the beginning and the end of the year, including increases and decreases (including distributions)
  • Information to reconcile book income/loss with return income/loss (see Form 1065 for specific details on this section
  • Schedule K-1 information about the partnership and the partners, including taxable income of partners from passive activities and other activities, qualified dividends, net capital gains, and income from other activities.

This is a general list of information you will need; you may need to provide other specific information or answers to specific questions on Form 1065, in addition to the list above.

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