Most businesses will need to register with the IRS, register with state and local revenue agencies, and obtain a tax ID number or permit.
A partnership must file an “annual information return” to report the income, deductions, gains and losses from the business’s operations, but the business itself does not pay income tax. Instead, the business “passes through” any profits or losses to its partners. Partners include their respective share of the partnership’s income or loss on their personal tax returns.
Partnership taxes generally include:
- Annual Return of Income
- Employment Taxes
- Excise Taxes
Partners in the partnership are responsible for several additional taxes, including:
- Income Tax
- Self-Employment Tax
- Estimated Tax