What IRS Form 1065 (2019) Is For

IRS Form 1065 (2019) is the official tax return that partnerships must file to report their business income, expenses, gains, losses, deductions, and credits for the 2019 tax year.

Partnerships don’t pay taxes directly; instead, they “pass through” profits and losses to partners, who report their share on their individual tax returns using Schedule K-1, which the partnership must provide to each partner and file with the IRS (IRS Instructions for Form 1065 (2019)).

When You'd Use Form 1065 for 2019 (Late or Amended Filing)

You’ll need to file a 2019 Form 1065 now if you:

• Never filed the original return (due March 16, 2020)
  
  
• Received IRS notices demanding the return
  
  
• Need to correct errors on a previously filed return
  
  

Common late-filing scenarios include:

• Partnerships that missed the original deadline
  
  
• Unreported income or expenses discovered later
  
  
• IRS CP notices demanding compliance
  
  
• Corrected Schedule K-1s required for partners
  
  

While there’s no refund available for information returns like Form 1065, filing late returns is crucial to avoid escalating penalties and remain compliant (IRS Instructions for Form 1065 (2019)).

Key Rules Specific to 2019

• Centralized audit regime: The second year of the BBA partnership audit rules applied. Small partnerships (≤100 eligible partners) could elect out by filing Schedule B-2.
  
  
• Penalties: $200 per partner, per month (max 12 months), which is lower than current penalty rates.
  
  
• Special CARES Act provisions: Amended returns could be filed before September 30, 2020 to take advantage of temporary relief—though this deadline has now passed.
  
  

Step-by-Step (High Level)

• Gather transcripts: Request partnership transcripts from IRS.gov or by calling 800-908-9946.
  
  
• Complete the 2019 Form 1065: Use the correct-year form, ensuring accuracy in income, deductions, and partner details.
  
  
• Prepare Schedule K-1s: Provide each partner with their distributive share of income, losses, deductions, and credits.
  
  
• Attach required schedules: Include Schedule B, Schedule K, and others as applicable.
  
  
• File return: E-file if 100+ partners; otherwise, mail to the appropriate IRS center.
  
  
• Keep records: Maintain copies of the return, K-1s, and all supporting documentation.
  
  

Common Mistakes and How to Avoid Them

• Missing Schedule K-1s: Triggers $270 penalty per partner.
  
  
• Incorrect partner basis calculations: Ensure accurate reporting in Schedule K-1, Item L.
  
  
• Failing to reconcile book-tax differences: Complete Schedule M-1 properly.
  
  
• Overlooking BBA election deadlines: Elect out of centralized audit regime on time.
  
  
• Incomplete Schedule B: Answer all questions, especially regarding foreign partners or transactions.
  
  
• Mixing entity-level and partner-level items: Partnerships usually don’t pay entity-level tax (except section 1446 withholding).
  
  

What Happens After You File

• Processing time: Typically 12–16 weeks, longer for late filings.
  
  
• IRS notices: May address missing information, errors, or penalties.
  
  
• Penalty handling: Partnerships cannot enter payment plans directly—penalties flow to responsible partners.
  
  
• Appeals: Disputes can be resolved under BBA rules or TEFRA (if opted out).
  
  
• Partner notifications: IRS may issue notices to partners regarding their Schedule K-1 obligations.
  
  

FAQs

How much is the late filing penalty for a 2019 partnership return?

$200 per partner per month, up to 12 months. Example: a 3-partner LLC filed 2 years late would owe $14,400 ($200 × 3 × 12).

Can I still amend a 2019 partnership return?

Yes, using Form 1065-X for paper amendments or e-filed Form 1065. Generally, corrections must be made within 3 years of the due date or filing date.

Do I need transcripts before filing?

Yes, IRS transcripts show prior filings, correspondence, or penalties. Request at IRS.gov/transcript or by calling 800-908-9946.

What if the partnership dissolved years ago?

You must still file a final return showing dissolution and final distributions. Filing is required until officially terminated.

Should partners amend their 2019 individual returns?

Yes, if Schedule K-1 information changes. Partners generally have 3 years from their individual due date to amend.

Can the IRS waive late filing penalties?

Yes, for reasonable cause such as illness, natural disaster, or reliance on professional advice. Include a written explanation with documents.

What if we can’t afford penalties?

Partners—not the entity—can request installment agreements using Form 9465 or apply online at IRS.gov/paymentplan.

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