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Business taxes: Income tax for partnerships

Small Business BasicsPartnerships that have gross income must file a return on Form 1065 showing income, deductions and other required information. Partnership returns should also include the name and address of each partner and their share of taxable income. See the form's instructions for more information about who must file it.

Form 1065 must be filed by April 15 if the partnership's accounting period is the calendar year. A fiscal year return is due by the 15th day four months after the close of the business's fiscal year. If the partnership thinks it will miss the date, it should file Form 8736 in April for an automatic three-month extension.

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A partnership computes its income and files its return in the same manner as an individual. Partners must pay estimated tax if they expect to owe tax on income of $1,000 or more. Payments are due quarterly, on April 15, June 15, Sept. 15 and Jan. 15. Tax is only paid once income has been received. For example, if no income was received until May 10, the estimated tax would be paid in June.

 

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