PARTNERSHIP RETURN OF INCOME - Louisiana Revenue

1 PARTNERSHIP RETURN OF INCOME with Instructions and Form IT-565B Apportionment of INCOME Schedule Louisiana Department of Revenue Box 3440 Baton Rouge, LA 70821-3440 IT-565 (1/17). Page 1. IT-565i (1/17). Louisiana Department of Revenue Instructions for Completing Form IT-565. P. O. Box 3440. PARTNERSHIP RETURN of INCOME Baton Rouge, LA 70821-3440. Partnerships not required to file a RETURN accounting period established on the first RETURN must remain as the A PARTNERSHIP RETURN is not required if all partners are natural persons accounting period for subsequent years under Louisiana INCOME Tax who are residents of Louisiana ( 47:201). Law, unless permission to make a change is received from the Secretary of Revenue . Partnerships that must file a RETURN A change by any PARTNERSHIP from one taxable year to another, or Any PARTNERSHIP doing business in Louisiana or deriving any INCOME the adoption by a new PARTNERSHIP for an initial taxable year, must from sources therein, regardless of the amount and regardless of the meet the provisions of 47:206(B)(1).

2 A change by a principal residence of the partners, must file a PARTNERSHIP RETURN of INCOME , partner from one taxable year to another must meet the provisions of Form IT-565 if any partner is a nonresident of Louisiana or if any 47:206(B)(2). A principal partner is one who has an interest of five partner is not a natural person. If the PARTNERSHIP has INCOME that is percent or more in the PARTNERSHIP profits or capital. derived from sources partly within and partly outside of Louisiana , an Apportionment of INCOME Schedule, Form IT-565B must be filed Accrued or received INCOME with Form IT-565. Louisiana Revised Statute ( ) 47 defines If records are kept on an accrual basis, report all INCOME accrued, even the term PARTNERSHIP to include syndicates, groups, pools, joint ven- though it has not been actually received or entered in the records, and tures, or other unincorporated organizations, through or by means of report all expenses incurred, not just expenses paid.

3 If records do not which any business, financial operation, or venture is carried on, and show INCOME accrued and expenses incurred, report all INCOME received that are not trusts, estates, or corporations within the meaning of the or constructively received, such as bank interest credited to your account Louisiana INCOME Tax Law. and expenses paid. INCOME tax returns of partners Penalties Each partner that is a natural person must include on his individual in- The penalty for willfully making a false or fraudulent RETURN or for come tax RETURN the amount of the distributive share of the net INCOME of willful failure to make and file the RETURN on time shall not be more the PARTNERSHIP , whether or not such share was distributed or withdrawn than $1,000, or imprisonment for not more than one year, or both, by the partner.

4 This distributive share of the PARTNERSHIP 's net INCOME and shall include the costs of prosecution. or losses must be reported to conform to the PARTNERSHIP 's accounting period, regardless of a fiscal year or calendar year taxable period. If the INCOME items exempt from tax PARTNERSHIP 's tax year does not coincide with the partners' tax year, in- The following are some types of INCOME that are exempt from Louisiana clude the INCOME or losses in the tax year in which the PARTNERSHIP 's tax INCOME tax and should not be included in gross INCOME : year ended. The Louisiana resident RETURN , Form IT-540 must be used (a) Amounts received under a life insurance contract paid by reason to report PARTNERSHIP INCOME for resident individuals. of the death of the insured and paid at the death of the insured. A nonresident member of a PARTNERSHIP who does not have a valid agree- For treatment of amounts paid at a date later than death, ment on file with LDR must be included in a Composite PARTNERSHIP 47:43(D).

5 RETURN (Form R-6922). Nonresident partners who have a valid agree- ment or who have other INCOME derived from Louisiana sources, must (b) That portion of an annuity that represents a RETURN of the taxpay- include all INCOME derived from Louisiana sources on Form IT-540B. er's investment, 47:44. Individuals should use the information reported on the federal (c) Gifts (not received as a consideration for services rendered) and PARTNERSHIP RETURN instead of the amounts shown in the partners' money and property acquired by bequest, devise, or inheritance. allocation schedule. Corporations should refer to Louisiana Revised However, the INCOME derived from such property is taxable. Statute ( )-47 (A)(5). (d) Interest on obligations of the United States Government and/or When and where the RETURN must be filed its instrumentalities.

6 Returns for a calendar year must be filed with the Department of (e) Interest on obligations of the State of Louisiana and its political Revenue , P O Box 3440, Baton Rouge, LA 70821-3440, on or before or municipal subdivisions to the extent as is now exempt by law. April 15 of the year following the close of the calendar year. Returns for fiscal years must be filed on or before the 15th day of the fourth month List in Schedule K all items of INCOME reported on your Federal RETURN after the close of the fiscal period. that are exempt from Louisiana tax. Period to be covered by RETURN Information at the source The RETURN must be filed for a calendar year, or for a fiscal year of 12 Any person, firm, PARTNERSHIP , trust, corporation, or organization months, ending on the last day of any month other than December, making payments totaling $1,000 or more during any calendar year for or for an annual period of 52/53 weeks if records are kept on that lease bonuses, delay rentals, and/or royalties respecting mineral leases basis.

7 For fiscal years or annual periods of 52/53 week filings, clearly affecting lands located in Louisiana and rentals paid for real property indicate the beginning and ending dates at the top of the RETURN . The located in Louisiana to a nonresident individual or a firm, PARTNERSHIP , trust, corporation, or organization not located in Louisiana shall file If the distributive share is a loss, the loss is limited to the an information RETURN with the Secretary of Revenue on or before June amount of the adjusted basis of such partner's interest in 1 of the following year for each such payee. The RETURN shall include the other PARTNERSHIP at the end of the PARTNERSHIP year in the name, address, Federal Employer Identification Number, and/or which the loss occurred. If the taxable year of the RETURN filed Social Security Number of both the payor and payee.

8 There shall also be does not coincide with the tax year of the other PARTNERSHIP , included the amount and description of payments to each such payee. include the distributive share of the net profits (or losses). The Federal Information RETURN Form (Form 1099) for reporting from the other PARTNERSHIP in the tax year in which the other such payments may be used for reporting the required information. PARTNERSHIP 's tax year ends. Federal Form 1099 shall be accompanied by the Annual Summary and Transmittal of Information Returns, Federal Form 1096 Line 5 Dividends Enter the amount of dividends (except certain furnishing the payor's name, address, employer identification number, stock dividends) received from any corporation, regardless of and/or social security number, along with the number of Forms 1099 whether or not the corporation has paid any INCOME tax to enclosed.

9 Informational returns reporting other items of INCOME that Louisiana . would normally appear on Federal Form 1099 are required only upon Line 6 Interest Enter the amount of all interest received or the specific request of the Secretary of Revenue . credited to the PARTNERSHIP during the taxable period on bank Federal Employer Identification Number Provide the Federal deposits, notes, mortgages, corporation bonds, and bonds of Employer Identification Number (EIN) that was assigned to the part- states, cities, and other political subdivisions. Do not include nership by the Internal Revenue Service. bonds issued under authority granted by Acts of the Louisiana Legislature, if such Acts provide that the interest on such bonds Federal Net INCOME Enter the amount of the PARTNERSHIP 's federal shall be exempt from taxation.

10 Net INCOME as reported to the Internal Revenue Service on Federal Form Line 7 Rents and Royalties Enter the amount of net INCOME or 1065, 47:103(B). Louisiana Revised Statute ( ) 47:103(C). net loss from Schedule B, Line 2. requires that every taxpayer whose federal INCOME tax RETURN is adjusted must furnish a statement disclosing the nature and amounts of such Line 8 Net Farm Profit (or Loss) Enter the amount of net adjustments within 60 days after the federal adjustments have been profit or net loss from farming. Attach schedule explaining made and accepted. determination of profit or loss. Line 9 Profit or Loss from the Sale of Capital Assets such as Stocks, Gross INCOME and deductions Bonds, Real Estate, etc. Enter the amount of profit from Line 1 Gross Receipts or Gross Sales Enter the amount of gross the sale of property, including property situated outside of receipts or gross sales, less goods returned, and any allowance Louisiana , as reported on Schedule D of the RETURN .