Each partnership must file a federal form 1065. Each partner's share of net income is reported to the IRS and to the partners using Schedule K-1. Partners pay income tax on their portion of net income by attaching Schedule K-1 and IRS 1040 Schedule E to their federal 1040 tax return.
Forms to use
IRS 1065 Annual Tax Return for Partnerships
Schedule K-1 forms for partners
How often?
Annual reporting requirement
Good news for small businesses!
If your partnership:
Then you can check "Yes" for question 5 on page 2 and ignore one third of the 1065 form. You won't have to complete:
How to complete IRS 1065
Page 1
Page 2
Page 3
K-1s
Partners...what to do with your K-1
1065 Schedule K-1 information should be entered on IRS 1040, Schedule E, Part II. The information from Schedule E is entered on line 17 of form 1040.
Due date
Forms 1065 and the partners' Schedule K-1s are due April 15. To help your partners meet their tax deadline, complete the forms as soon as possible.
How to submit
Mail 1065 with copies of your partners' Schedule K-1s to the IRS. Do not pay any tax.
Click here for the mailing address for IRS 1065.
Give your members their Schedule K-1s. They should pay any tax due with their IRS 1040.
Partners should attach Schedule SE, and Schedule E with their 1040 return.
Questions? Call the IRS information hotline (800) 829-4933. For forms, call (800) 829-3676 or obtain them online at http://apps.irs.gov/app/picklist/list/formsPublications.html.
Business Property Tax
Business real property (land, buildings, etc.) and business equipment are subject to an ad-valorem tax in the State of Montana. All non-exempt property is taxed based on its full market value. Different classes of property are subject to different assessment rates. As an example, real property (land and buildings) in the City and County of Butte-Silver Bow is currently taxed at 1.54% of its market value annually (prior to any incentives).
Equipment taxes
Business equipment taxes have been declining in recent years because of actions of the Legislature. In 1995, the Legislature enacted a law which results in a continued decline in business equipment property taxes. In 1999, this legislative action has resulted in a decrease in business equipment taxes to 2.39% of the market value annually, prior to the application of any tax incentives.
Tax on inventory
Business inventories, goods-in-transit, intangible assets and freeport merchandise are statutorily exempt from property taxation. In addition, business equipment belonging to qualified research and development companies may be taxed at approximately 1% of market value in perpetuity.
This form is used to report business you have done with independent contractors (who are not corporations) and medical corporations. Complete Form 1099-Misc:
If you paid over $600 in interest (to a non-corporation), you must file IRS form 1099-I. To request this form, call the IRS at (800) 829-3676 or go to http://apps.irs.gov/app/picklist/list/formsPublications.html
Forms to use
1099-M Annual Information Form for Independent Contractors
Preparing 1099s is not user-friendly. The IRS does not have a direct way to input the information online. Instead, it has authorized companies to be 1099 providers. Do a search on the Internet for current providers and prices.
How often?
Annual reporting requirement
Due date
January 31 to the recipient
February 28 to the IRS
To do it yourself
Doing it yourself is possible, but not user-friendly. You have to use official IRS forms and must prepare them using a computer or typewriter (remember those?). Here is how to do it:
Prepare 1 form for each payee.
Lines and what to do
Left side
Right side
How to complete form 1096
1096 is the transmittal form. It must also be prepared on a computer or typewriter. Prepare one form to transmit all the 1099-Misc.
Lines and what to do
Top
Bottom Check box 1099-MISC - 95
How to submit
A few more rules $50 fine for ignoring these rules:
Questions? For forms call (800) 829-3676. You cannot obtain original forms from the Internet. For information, call (800) 829-4933 or read Publication 937 Business Reporting.