Partnership Tax Return Deadlines Explained

Federal Partnership Tax Return (Form 1065)

What are the tax return deadlines for partnerships and limited liability companies which are treated as partnerships?

• Original Due Date: The federal income tax return for a partnership (Form 1065) is due on the 15th day of the third month following the close of the partnership’s tax year. For most partnerships that operate on a calendar year (ending December 31st), this means the original due date is March 15th.
• Extensions: Partnerships can file for an automatic extension of time to file Form 1065 by using Form 7004, Application for Automatic Extension of Time to File Business Income Tax, Information Returns, and Other Returns. This extension grants an additional six months, pushing the filing deadline to September 15th for calendar-year partnerships. It’s crucial to understand that this is an extension to file, not an extension to pay. Any taxes owed are still due on the original March 15th deadline. See Where to File Form 7004.

State Partnership Tax Returns

• Vary by State: State filing requirements vary significantly. Some states mirror the federal due dates, while others have different deadlines. It’s essential that you check the specific rules for the state(s) where the partnership operates and where the partners reside. Many states also have extension options similar to the federal one, often using a form comparable to Form 7004. Some states may require composite returns for nonresident partners. It is best to consult with a tax professional regarding specific state requirements.

Partner K-1 Delivery (Schedule K-1)

• Due to Partners: Partnerships must furnish each partner with a Schedule K-1 (Form 1065), Partner’s Share of Income, Deductions, Credits, etc., by the same date the partnership tax return is due, including extensions. So, if the original deadline is March 15th, and an extension is filed, the K-1s are due to partners by September 15th for a calendar-year partnership. Providing K-1s to partners by the deadline is critical because partners need this information to file their individual income tax returns.

Key Points about Extensions:

• Automatic: The Form 7004 extension is generally considered automatic, meaning the IRS doesn’t usually require a reason for the extension request. However, it’s essential to file the form on or before the original due date (March 15th).
• Payment Still Due: As mentioned earlier, the extension is only for filing the return. The estimated tax liability must still be paid by the original due date to avoid penalties. If you expect a balance due with the return, submit your payment with the extension request. The same rule applies to your partners even though they have not received a K-1 telling them how much income or loss to report.
• State Extensions: Don’t assume a federal extension automatically grants a state extension. You must file for a state extension separately if needed. Many partnerships have activities in multiple states and must file tax returns in more than one state. Be sure to check the extension requirements for every state in which the partnership must file.
• Penalties: Failure to file the partnership return or provide K-1s to partners by the due date (including extensions) can result in significant penalties. Penalties can also be assessed for underpayment of estimated tax.

Important Considerations:

• Professional Advice: Tax laws are complex and can change. It’s always best to consult with a qualified tax professional for personalized advice regarding your specific partnership situation. They can help ensure you meet all filing requirements and avoid potential penalties.
• Consider Your Partners: When a partnership files for an extension, each partner must also typically file for an extension of his personal tax return. A partner must also pay his taxes by the original due date. Not having a K-1 makes calculating that tax payment difficult. Some partners may have overpaid their taxes. The extension means that they must wait to file their return to get a refund. For these reasons, partners are often unhappy when a partnership files an extension.
• State-Specific Rules: This information focuses on federal guidelines. State rules are equally important and must be followed. Don’t neglect the state requirements!

Remember, this is general information, and it’s not a substitute for professional tax advice. Always consult with a CPA or tax attorney for guidance tailored to your partnership.

Filing Form 1099 – an overview

If you made certain payments during the tax year, you are required by the IRS to send a Form 1099 to the recipient of the payment and file a copy with the IRS.

There are many different versions of Form 1099 for different types of payments.  The following table sets forth the filing requirements for each type of Form 1099 you may need to file.

Form 1099 Descriptions, Requirements, and Due Dates

*Minimum Reporting Requirement: You are required to file a 1099 if the sum of all the payments you made during the year to any one recipient was this amount or more.

Payments to Corporations and Partnerships

Generally, payments to corporations are not reportable. However, you must report payments to corporations for the following.

• Medical and health care payments (Form 1099-MISC),
• Withheld federal income tax or foreign tax,
• Barter exchange transactions (Form 1099-B),
• Substitute payments in lieu of dividends and tax-exempt interest (Form 1099-MISC),
• Acquisitions or abandonments of secured property (Form 1099-A),
• Cancellation of debt (Form 1099-C),
• Payments of attorneys’ fees and gross proceeds paid to attorneys (Form 1099-MISC),
• Fish purchases for cash (Form 1099-MISC),
• The credits for qualified tax credit bonds treated as interest and reported on Form 1099-INT,
• Merchant card and third-party network payments (Form 1099-K), and
• Federal executive agency payments for services (Form 1099-MISC).

Reporting generally is required for all payments to partnerships. For example, payments of $600 or more made in the course of your trade or business to an architectural firm that is a partnership are reportable on Form 1099-MISC.

How Do I File a 1099?

1099s are filed on paper only. Unlike other tax forms, 1099s cannot generally be printed out at home on a desktop printer. Blank 1099s are printed on special paper. You can obtain the forms for free from the IRS or buy them at office supply stores.

Each Form 1099 comes with 5 copies. You write or type on the top copy and it transfers down onto each copy, like carbon paper. You fill out the 1099 and send Copy A to the IRS, Copy 1 to the appropriate state tax agency, Copy B and Copy 2 to the income’s recipient (they get two copies so they can attach one to their return and keep one), and you keep Copy C for your records.

After you have filled out all of your 1099 forms for the year, you need to fill out a Form 1096 as well. Form 1096 summarizes all of your 1099 forms and is filed with the IRS.

While the forms must be filed on paper, they can be transmitted to the IRS through the FIRE (Filing Information Returns Electronically) system.

All Form 1099 filers must have an EIN. If you have not previously filed a Form 1099 or other return, you must obtain an EIN and include it on each Form 1099 that you file.

Last updated: January 30, 2015