What Form 1065-X Is For

Form 1065-X is the IRS form that partnerships and certain other business entities use to fix mistakes or make changes to a previously filed partnership tax return (Form 1065). Think of it as a "correction form" for partnership returns—similar to how individuals use Form 1040-X to amend their personal tax returns.

For the 2019 tax year, Form 1065-X serves two distinct purposes depending on your partnership's status. Non-TEFRA partnerships (most small partnerships with 10 or fewer U.S. individual or C corporation partners) use it to file an amended return to correct errors like incorrect income amounts, deductions, or credits. Meanwhile, partnerships subject to the Tax Equity and Fiscal Responsibility Act (TEFRA) procedures use Form 1065-X to file an Administrative Adjustment Request (AAR)—a formal request to adjust partnership items that flows through special audit procedures.

It's important to understand that this form changes the partnership's return, which then affects each partner's individual tax situation through their Schedule K-1. When you correct the partnership return, each partner typically needs to amend their personal returns to reflect the corrected information.

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When You’d Use This Form (Late/Amended Filing)

You would file Form 1065-X for your 2019 partnership return in several common situations. Perhaps you discovered mathematical errors in your original filing, received corrected income documents (like a late-arriving 1099 form), incorrectly reported partnership income or deductions, made mistakes in allocating items to partners on their Schedule K-1 forms, or forgot to claim deductions or credits the partnership was entitled to receive.

Critical timing rules apply: You generally have three years from the date you filed your original 2019 Form 1065, or three years from the return's due date (whichever is later), to file Form 1065-X. For most partnerships, the 2019 Form 1065 was due March 16, 2020, so the deadline to file an amended return would typically be March 16, 2023. If you filed an extension and submitted your return later, count three years from your actual filing date.

However, there's an important exception: If your partnership was subject to TEFRA procedures and the IRS has already sent you a "notice of final partnership administrative adjustment," you cannot file an AAR for that year. Additionally, if you received corrected information from another partnership you invested in, you should file promptly after receiving that corrected Schedule K-1.

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Key Rules for 2019 Tax Returns

Transitional Rules and Which Regime Applies

The 2019 tax year falls into a transitional period for partnership tax procedures, so understanding which rules apply to your partnership is essential. Partnerships with tax years beginning before 2018 (which includes the typical calendar-year 2019 return) follow either TEFRA procedures or non-TEFRA procedures, not the newer Bipartisan Budget Act (BBA) rules that apply to later years.

Non-TEFRA Partnerships

For non-TEFRA partnerships (the majority of small partnerships), filing is relatively straightforward. Any partner can sign the amended return, and the form must be filed with the same IRS service center where you filed the original return. You'll need to provide clear explanations of all changes in Part V of the form, and if changes affect specific schedules or require supporting documents, you must attach those materials. Most importantly, partners should be notified that they may need to amend their individual returns to reflect the partnership corrections.

TEFRA Partnerships

For TEFRA partnerships, the process is more formal. Only the Tax Matters Partner (TMP)—the person designated on your original return to represent the partnership—can sign and file the AAR. The TMP has the authority to act on behalf of all partners in dealings with the IRS. If the IRS doesn't respond to your AAR within six months, you can petition the Tax Court or other federal courts for judicial review, but you must do so before two years have passed since filing the AAR.

Special Considerations

An important consideration: partnerships subject to consolidated REMIC procedures (Real Estate Mortgage Investment Conduits) have special rules that may apply. Additionally, you cannot use Form 1065-X to change your partnership's election status—such as electing into or out of certain audit regimes.

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Step-by-Step Filing Process (High Level)

Step 1: Gather Your Documentation

Collect your original 2019 Form 1065, all schedules, and the records showing what needs to be corrected. Identify the specific line items that require changes and calculate the corrected amounts. Having clear documentation of why changes are needed will help explain adjustments in Part V.

Step 2: Determine Your Partnership Type

Complete Part I of Form 1065-X to identify whether your partnership is subject to TEFRA procedures. Answer the questions about the number of partners and their types. Most small partnerships with 10 or fewer qualified partners will check "Not subject to TEFRA" and file an amended return. If you're subject to TEFRA, you'll file an AAR instead.

Step 3: Complete the Form

In Part II, you'll work with three columns for each line item: Column (a) shows amounts from your original return, Column (b) shows the increase or decrease (the change amount), and Column (c) shows the corrected final amount. Only complete lines where changes are being made—you don't need to fill out every single line. Use negative numbers (in parentheses) for decreases.

Step 4: Explain All Changes

Part V is crucial—this is where you clearly explain every change you're making and why. Be specific: "Line 1c corrected to include $15,000 in unreported income from ABC Company as shown on amended 1099-MISC" is much better than "Income correction." The IRS processor needs to understand your reasoning.

Step 5: Prepare Amended Schedules K-1

If partnership items changed, you'll need to prepare corrected Schedule K-1 forms for each affected partner showing their revised share of income, deductions, and credits. Mark these clearly as "Amended" and include an explanation of changes. Provide copies to all partners so they can amend their personal returns.

Step 6: Sign and Submit

For non-TEFRA partnerships, any partner can sign. For TEFRA partnerships, the Tax Matters Partner must sign. Mail the completed Form 1065-X with all attachments to the same IRS service center where you filed your original return. Keep copies of everything for your records.

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Common Mistakes and How to Avoid Them

Mistake #1: Missing the filing deadline

Many partnerships don't realize they only have three years to amend. Mark your calendar and file promptly when you discover errors. Don't wait until the last minute—processing takes time, and if you're requesting a refund, you want to file within the statute of limitations.

Mistake #2: Failing to explain changes adequately

The IRS receives countless amended returns. If your explanation in Part V is vague or incomplete, it can delay processing or result in requests for additional information. Always provide specific, detailed explanations with supporting documentation.

Mistake #3: Not updating partners' Schedule K-1 forms

Some partnerships amend the partnership return but forget to give partners their corrected Schedule K-1 forms. This creates problems because partners need these to amend their personal returns. Always prepare and distribute amended K-1s along with clear instructions to partners about what they need to do.

Mistake #4: Using the wrong form version

For tax years beginning before January 1, 2021 (which includes most 2019 calendar-year returns), you must use the September 2018 version of Form 1065-X, not newer versions. Using the wrong version can cause processing delays. The IRS Instructions for Form 1065-X specify which revision to use based on your tax year beginning date.

Mistake #5: Confusing amended returns with AAR procedures

If your partnership is subject to TEFRA, you cannot file a simple amended return—you must follow AAR procedures. Similarly, if you're not subject to TEFRA, don't check the AAR box. Understanding your partnership type is critical to filing correctly.

Mistake #6: Forgetting to attach required supporting schedules

If you're changing amounts that are supported by other forms or schedules (like Schedule D for capital gains), you must attach the corrected schedule. Write "Copy Only—Do Not Process" at the top of any previously filed forms you're including for reference, as instructed by the IRS.

Mistake #7: Not keeping adequate records

Document everything about why you're filing the amendment. Keep copies of all correspondence, the complete amended return package, proof of mailing, and records of communications with partners. If the IRS has questions later, you'll need this documentation.

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What Happens After You File

Initial Processing Time

Once you mail Form 1065-X to the IRS, processing begins, but it's not a quick process. Unlike individual amended returns filed on Form 1040-X, the IRS doesn't provide a specific online tracking tool for Form 1065-X. Processing times can vary significantly depending on the complexity of the changes and IRS workload, but you should generally expect several months for the IRS to review and process your amended partnership return.

If Your Amendment Results in a Refund

The IRS will process the refund after reviewing and accepting your changes. The partnership will receive the refund check, not individual partners. The partnership then decides how to distribute the refund to partners according to their ownership interests.

If the Amendment Increases Tax Owed

You should include payment with Form 1065-X. If you didn't, the IRS will send a notice with the amount due, plus interest calculated from the original due date. Interest is charged under the rates specified in section 6621 of the Internal Revenue Code.

If the IRS Disagrees With Your Changes

You'll receive a letter explaining what they're questioning. For non-TEFRA partnerships, this typically leads to correspondence or potentially an audit. For TEFRA partnerships filing an AAR, the IRS may accept the AAR, propose different adjustments, or take no action. If the IRS doesn't respond to a TEFRA AAR within six months, the Tax Matters Partner can petition for judicial review in the U.S. Tax Court, U.S. Court of Federal Claims, or U.S. District Court—but must do so before two years have passed since filing the AAR.

What Partners Should Do

Once you've filed Form 1065-X and prepared amended Schedule K-1 forms, distribute them promptly to all partners with clear instructions. Partners generally have three years from when they filed their original return (or from the due date, whichever is later) to file their amended Form 1040. They should file soon after receiving the corrected K-1 to avoid running out of time.

State Consequences

Remember that amending the partnership return can trigger changes to state tax returns as well. Both the partnership and individual partners should check whether state amendments are necessary.

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FAQs

Q1: Can I file Form 1065-X electronically for my 2019 return?

The IRS provides guidance that non-TEFRA partnerships may be able to file amended returns electronically by updating and resubmitting the entire corrected Form 1065 through authorized e-file providers, though Form 1065-X itself (as a paper form) cannot be transmitted electronically. However, for 2019 tax returns specifically, most partnerships will need to file paper Form 1065-X. Check the IRS guidance for amended partnership returns at IRS.gov/e-file-providers for the most current electronic filing options.

Q2: Do I need to file Form 1065-X if I just need to correct a partner's address or other non-financial information?

No. Form 1065-X is only for correcting financial items—income, deductions, credits, and amounts allocated to partners. For administrative corrections like addresses that don't affect any partner's tax liability, the IRS instructions indicate you should contact the IRS service center where you filed to request the correction rather than filing Form 1065-X.

Q3: What if I discover I need to amend an already-amended return?

You can file a second Form 1065-X to correct a previously amended return. On the second amendment, use Column (a) to show the amounts from your first amended return (or as adjusted by the IRS), not the original return amounts. The IRS instructions specify that you should enter amounts "as originally filed or as previously adjusted."

Q4: If one partner's K-1 was wrong but the partnership totals are correct, do I still need to file Form 1065-X?

Yes. If you need to reallocate income, deductions, or credits among partners—even if the partnership's overall totals don't change—you must file Form 1065-X. You'll show the corrections in the partner-level details and prepare amended Schedule K-1 forms showing each partner's corrected allocations.

Q5: Will filing Form 1065-X automatically trigger an audit of the partnership or individual partners?

Filing an amended return doesn't automatically trigger an audit, but it does give the IRS another opportunity to review your return. The IRS may have questions about the changes. Having thorough documentation and clear explanations in Part V of the form is important for supporting your corrections.

Q6: Can I still file Form 1065-X for 2019 if we've already passed the three-year deadline?

Generally, no. According to the IRS instructions, you can file an amended return or AAR within 3 years after the later of: the date the partnership return was filed, or the last day for filing the partnership return (excluding extensions). The statute of limitations is firm. However, there are rare exceptions in specific circumstances. Consult a tax professional if you're beyond the deadline but believe you have grounds for an exception.

Q7: Who pays if the amended return shows additional tax owed—the partnership or individual partners?

This depends on the nature of the corrections and your partnership structure. In most cases, partnerships are pass-through entities that don't pay federal income tax themselves—the partners pay tax on their share of income. However, penalties and interest on partnership-level items may be assessed at the partnership level. Each partner's share of any additional tax gets reported on their amended K-1, and they pay through their individual tax returns. The IRS instructions note that interest is charged at the rates under section 6621.

Notes

Important Note: This guide covers general information for 2019 Form 1065-X filings based on IRS guidance. Partnership tax law is complex, and the specific rules that apply depend on your partnership's size, structure, and whether you're subject to TEFRA procedures. For specific situations, especially those involving significant dollar amounts or complex partnership structures, consult with a qualified tax professional or CPA who specializes in partnership taxation.

For the most current forms and instructions, always visit IRS.gov/Form1065X.