Partnership Overview

A partnership is a business with more than one owner that has not filed papers with the state to become a corporation or LLC (limited liability company). There are two basic types of partnerships -- general partnerships and limited partnerships. The general partnership is the simplest and least expensive co-owned business structure to create and maintain. However, there are a few important facts you should know about the personal liability of general partners.

Partnership Taxes

A partnership is not a separate tax entity from its owners; instead, it's a "pass-through entity." This means the partnership itself does not pay any income taxes on profits. Business income simply "passes through" the business to the partners, who report their share of profits (or losses) on their individual income tax returns. In addition, each partner must make quarterly estimated tax payments each year.

While the partnership itself doesn't pay taxes, it must file an informational return, each year. 

At Capital Tax & Accounting we will go over the key element to tailor your business needs.

  • Partnership Distributions
  • Transactions Between Partnership and Partners
  • Basis of Partner's Interest
  • Partnership Gains and Losses.
  • Partnership Agreement .
  • Community Property
  • Marketable securities treated as money
  • Loss on Distribution
  • Net pre-contribution gain
  • Guaranteed Payments
  • Capital material/nonmaterial
  • Capital interest
  • Gift capital interest

Please contact us for a quote and / or a proposal to provide Partnership income tax services at

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