Thinking twice about having a Partnership
Its tax return extension filing season as a great many business owners across the U.S. know all too well. But did you know that if you run your business as a partnership – or if you run part of your business as a partnership that you may or may not be exempt from filing an actual tax return for the business, otherwise known as a 1065 Partnership Tax Return.
Many companies in the U.S. are set up as Partnerships. Whether that be to run a business, or to just hold the real estate of a company, or just because it is easy and you do not have the formality or cost of a corporation. And all too often, many owners of these partnerships may disregard filing an actual tax return for the company and may instead report their income and expenses on a Schedule C. Beware – doing this can cost you an IRS penalty!
There is a Revenue Procedure that exists that does exempt a partnership from paying a penalty for the non-filing of a partnership tax return if there are 10 or fewer partners, however there are other criteria that must be met. In this month’s tax tip and article we will discuss all of this.
If you would like more information on Tax Matters for your business, please contact us at 618-997-3436 or check us out on the web at www.taxplanning.com.