Question: How do partnerships file and pay quarterly estimated tax payments?
- Partnerships file Form 1065 (.pdf), U.S. Return of Partnership Income, to report income and expenses.
- A partnership does not pay tax on its income but "passes through" any profits or losses to its partners. Generally, the partnership must prepare and give partners a copy of Schedule K-1 (Form 1065) (.pdf), Partner’s Share of Income, Deductions, Credits, etc.
- The partners report the information from the K-1 on their own returns and pay any taxes due, including estimated taxes.
How Partners Pay Estimated Tax
Because partners are not employees of the partnership, partnerships do not withhold tax from their distributions to pay the partners’ income and self-employment taxes on their Forms 1040 (.pdf), U.S. Individual Income Tax Return. The partners may need to pay estimated tax payments using Form 1040-ES (.pdf), Estimated Tax for Individuals.
Partners pay estimated tax:
- By crediting an overpayment on your 2014 return to your 2015 estimated tax
- By sending in your payment (check or money order) with a payment voucher from Form 1040-ES
- Via Direct Pay
- Electronically using the Electronic Federal Tax Payment System (EFTPS)
- By electronic funds withdrawal (EFW) if you are filing Form 1040 electronically
- By credit or debit card
- Publication 505, Tax Withholding and Estimated Tax
- Instructions for Form 1065 (.pdf), U.S. Return of Partnership Income
Category: Estimated Tax