Form 541 - Partnerships - Department Of Treasury Internal Revenue Service

Publication 541

Contents

(Rev. February 2006)

Cat. No. 15071D

Important Reminder . . . . . . . . . . . . . . . 1

Department

of the

Introduction . . . . . . . . . . . . . . . . . . . . . 1

Partnerships

Treasury

Forming a Partnership . . . . . . . . . . . . . 2

Internal

Revenue

Terminating a Partnership . . . . . . . . . . . 3

Service

Exclusion From Partnership

Attention: This publication will no longer be revised on an annual

Rules . . . . . . . . . . . . . . . . . . . . . . 3

basis. The information contained in this publication no longer requires

Partnership Return (Form 1065) . . . . . . . 4

annual updates. To find changes that may affect current year returns,

see What’s New in your income tax return instructions; Publication

Partnership Distributions . . . . . . . . . . . 4

553; What’s Hot in Tax Forms, Pubs, and Other Tax Products at

The information removed from this publication

Transactions Between

is available in the Instructions for Form 1065 and Partner’s Instructions

Partnership and Partners . . . . . . . . 6

for Schedule K-1 (Form 1065). To comment on this revision process,

see Comments and Suggestions on page 2.

Basis of Partner’s Interest . . . . . . . . . . . 9

Disposition of Partner’s Interest . . . . . . 10

How To Get Tax Help . . . . . . . . . . . . . . 12

Index . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Important Reminder

Photographs of missing children. The Inter-

nal Revenue Service is a proud partner with the

National Center for Missing and Exploited Chil-

dren. Photographs of missing children selected

by the Center may appear in this publication on

pages that would otherwise be blank. You can

help bring these children home by looking at the

photographs and calling 1-800-THE-LOST

(1-800-843-5678) if you recognize a child.

Introduction

This publication provides supplemental federal

income tax information for partnerships and

partners. It supplements the information pro-

vided in the instructions for Form 1065, U. S.

Return of Partnership Income, and the Partner’s

Instructions for Schedule K-1 (Form 1065). Gen-

erally, a partnership does not pay tax on its

income but “passes through” any profits or

losses to its partners. Partners must include

partnership items on their tax returns.

For a discussion of business expenses a

partnership can deduct, see Publication 535,

Business Expenses. Members of oil and gas

partnerships should read about the deduction

for depletion in chapter 10 of that publication.

Certain partnerships must have a tax matters

partner (TMP) who is also a general partner. For

Get forms and other information

information on the rules for designating a TMP,

faster and easier by:

see Designation of Tax Matters Partner (TMP) in

the Form 1065 instructions and section

Internet •

301.6231(a)(7)-1 of the regulations.

Many rules in this publication do not

apply to partnerships that file Form

1065-B, U.S. Return of Income for

CAUTION

Electing Large Partnerships. For the rules that

apply to these partnerships, see the instructions

for Form 1065-B. However, the partners of elect-

/efile

ing large partnerships can use the rules in this

publication except as otherwise noted.

Form 541 - Partnerships - Department Of Treasury Internal Revenue Service - 2006

Related Articles

Related forms

Related Categories