Partnership return

A partnership return is filed by unincorporated entities with more than one owner. The most common entity required to file a partnership return is a multi-member LLC. In this return, the entity reports the revenue made for the year and claim business deductions in the manner and amount allowed by tax rules. It also reports “separately stated items”. These can be items of income such as dividends, interest, or capital gains, and items of loss/deduction such as charitable contributions, Section 179 deducction, and capital loss. Because these items have a special tax treatment at the personal level, they must be reported separately.

The net income/loss from operations as well as the separately stated items are reported to each partner according to their share on a Schedule K-1. The partners then report the items of income and loss/deduction from their K-1 on their personal returns.

Our package

Form 1065

Starts at

$250

Our service includes professional preparation of your return, e-filling when applicable, filed copy of your return, and proof of submission to the IRS. E-filling is only available for the 3 most current tax years.

Prices

Our fee depends on the information you need to report for the year. To determine our fees, we’ll need to review a P&L statement for the year. Our fees for this return start at $250.

If you don’t have any income for the year, and just need to file a return for compliance purposes, our fee is $250.

Process

Click on “Get started” above to learn about our seamless step-by-step process to prepare your tax return. If you are interested in getting a quote, please create an account and send us your P&L statement for the year.

Foreign owned multi-member LLC

If your LLC is owned by only nonresident aliens (neither US citizens or US residents for tax purposes) and you do not have business operations in the US, then your LLC income is most likely not taxable in the US.

For tax purposes, a partnership is a “pass-through entity”. This means that the LLC is not the taxable entity. The taxable entity(ies) with respect to the LLC income are the LLC members. If all members are nonresident aliens for tax purposes, they are only subject to income tax in the US if they have “effectively connected income with the conduct of a trade or business in the US”. This means that as long as the business operations of the LLC don’t take place in the US, the LLC income will not be taxable to the nonresident members.

In this situation, the LLC should file a partnership return reporting the gross revenue made for the year (as the revenue was likely reported by third parties to the IRS), and attach a statement to the return explaining to the IRS why the revenue reported is not subject to income tax under the law to the nonresident partners.

By taking this position, none of the nonresident members will be required to file a personal return.