What IRS Form 1065 (2024) Is For
IRS Form 1065 (2024) is the U.S. Return of Partnership Income that domestic partnerships and foreign partnerships must file annually to report income, deductions, gains, losses, and other tax information to the IRS. This partnership tax return shows the business’s gross income, net income, credits, and profits for the tax year ended December 31, 2024.
All partnerships with two or more individuals who receive income from trade or business activities are required to file an information return. The partnership itself does not pay income tax directly. Instead, income, losses, and deductions pass through to each partner, who must report them on their individual tax return. Each partner receives a Schedule K-1 form showing their share of partnership items, including wages, dividends, and interest.
When You’d Use Form 1065 for 2024 (Late or Amended Filing)
You would file a late or amended IRS Form 1065 (2024) if your partnership missed the March 15, 2025, due date or the extended September 15, 202,5, date and received IRS notices about a missing filing.
Typical reasons include:
- Unreported Partnership Income: A partnership discovers income or transactions that were not included in the original tax return.
- IRS Notices Received: The partnership receives a CP-162A notice regarding a missing or incomplete filing and must respond promptly.
- Calculation or Allocation Errors: Partners must correct errors in income, deductions, or profit distributions that affect the return.
- Amended Return Required: Partnerships must file a new form marked “Amended Return” when changing reported amounts.
Partnerships cannot claim refunds directly; however, any adjustments are passed through to partners, who may receive refunds or owe additional money on their individual returns.
For complete details on wage reporting, withholdings, and unemployment tax filings, see our guide to Business Income Tax Forms.
Key Rules Specific to 2024
- Electronic Filing Requirement: Partnerships filing 10 or more returns must e-file Form 1065 and related schedules.
- Increased Penalties: Late filing penalties increased to $235 per partner per month for returns due after December 31, 2024.
- K-2 and K-3 Reporting: Certain smaller domestic partnerships may qualify for exceptions to these schedules.
- Enhanced Partner Reporting: Schedule K and Schedule K-1 must include detailed partnership income and deductions to ensure transparency.
Partnerships must include their employer identification number, address, calendar year, and tax year information on the filing form. Maintaining accurate records ensures compliance with IRS eligibility criteria and minimizes errors that can delay processing or cause penalties.
Step-by-Step (High Level)
- Gather Records: Obtain wage and income transcripts and partnership account documents showing transactions, receipts, and deductions.
- Use the Correct Form: File the 2024 IRS Form 1065 that matches your tax year ended December 31, 2024, and print or e-file the complete form.
- Prepare Partner Schedules: Issue each partner a Schedule K-1 that reports their individual share of profits, losses, and credits for their tax return.
- E-File the Return: Partnerships with 10 or more returns are required to e-file; smaller entities may mail a paper return accompanied by proper documentation.
- Maintain Documentation: Keep printed copies of all tax forms, K-1 schedules, and supporting documents for a minimum of four years to ensure compliance.
Common Mistakes and How to Avoid Them
- Incorrect Partner Allocations: Ensure that Schedule K totals match the combined amounts reported on all Schedule K-1 forms before submission.
- Failure to E-File: Partnerships required to e-file must comply with IRS electronic filing rules or face penalties, even if all taxes are paid in full.
- Book-Tax Reconciliation Errors: Double-check Schedule M-1 or M-3 to confirm that income and expense reconciliations align with the partnership’s financial statements.
- Late Distribution of K-1s: Provide all Schedule K-1 forms to partners by the filing deadline, including extensions, so that they can prepare their individual returns on time.
- Missing Partnership Representative: Designate a partnership representative on Form 1065 as required under the Bipartisan Budget Act (BBA) audit rules to avoid IRS appointment of one.
- Penalty Miscalculations: Calculate late filing penalties correctly—$235 per partner, per month (up to 12 months) for returns due after 2023—to prevent unnecessary charges.
Learn more about how to avoid business tax problems in our guide on How to File and Avoid Penalties.
What Happens After You File
The IRS processes most e-filed partnership returns faster than paper filings. If the partnership owes money, it must pay taxes promptly to avoid additional interest or penalties. Payment options include electronic funds withdrawal, installment agreements using Form 9465, or reasonable cause relief requests through Form 843.
If your partnership receives a notice, refer to the instructions for that form and respond by mail or through your IRS online account. Partnerships should print and keep receipts for payments, record refund adjustments, and track correspondence to confirm processing. Partnerships that owe balances should contact the IRS immediately to arrange payments and protect their business standing.
FAQs
How much is the late filing penalty for IRS Form 1065 (2024)?
The penalty is $235 per partner per month, up to 12 months. For example, if a partnership with four partners files its tax return three months late, it owes $2,820. Filing promptly helps limit additional charges and maintain compliance. Taxpayers can request penalty relief if they meet the eligibility criteria established by the IRS.
Can partnerships get penalty relief for reasonable cause and income tax delays?
Yes, the IRS may abate penalties if the partnership proves reasonable cause. Acceptable reasons include serious illness, natural disasters, or unavoidable events that prevent filing. Partnerships should submit Form 843 with complete documentation and explain how the situation affected their income tax filing form and payment ability.
How do I get an income transcript or wage and income transcript for a partnership?
Partnerships can request income transcripts by calling the IRS at 800-908-9946, mailing Form 4506-T, or using IRS online services, which feature a locked padlock icon for added security. Wage and income transcripts display the information the IRS has on file, including account transactions, payments, and reported income for the applicable tax year.
Do foreign partnerships and domestic partnerships have different filing requirements?
Yes, domestic partnerships use the standard IRS Form 1065 (2024) to report partnership income, while foreign partnerships must meet additional information return requirements. These include disclosing U.S. partners, income sources, and deductions related to U.S. business operations to determine net income and partnership tax obligations.
What are the eligibility criteria for e-file and annual return submission?
Partnerships filing 10 or more returns must e-file their annual return, including Form 1065, Schedule K, and all partner schedules. The IRS requires complete contact information, employer identification number, and partnership details to process filings. Electronic submission ensures faster confirmation, reduces mail delays, and improves accuracy in reporting.
For more resources on filing or understanding prior-year IRS forms, visit our Form Summaries and Guides Library.
