The schedule that must be attached for this line is not shown. Interest income on accounts receivable, $559, is entered on this line.

Gross profit of $138,459 is shown on this line. Returns and allowances of $3,365 are entered on line 1b, resulting in net sales of $406,100, entered on line 1c.Ĭost of goods sold, $267,641, from Schedule A, line 8, is entered here. Gross sales of $409,465 are entered on line 1a. The partnership's ordinary income from the trade or business activity is shown on lines 1a through 8. When Frank completes the return, he places the partnership's label in the address area on page 1.įrank supplies all the information requested at the top of the page. He returned the postcard and the IRS sent him the package. The IRS sent Frank a postcard with the partnership's preaddressed label, asking if he needed a Form 1065 package. In addition to receiving income and paying expenses in its partnership operations, AbleBaker made a $650 cash charitable contribution, received $150 from dividends, and received $50 tax-exempt interest from municipal bonds.įrank completes the partnership's Form 1065 as explained next. Both partners materially participate in the operation of the business. The partners are personally liable for all partnership liabilities. Any profit or loss will be shared equally by the partners. The partnership agreement states that Frank will receive a yearly guaranteed payment of $20,000 and Susan will receive $5,000. Frank works full time in the business, while Susan works approximately 25% of her time in it. The partnership uses an accrual method of accounting and a calendar year for reporting income and loss. This filled-in Form 1065 is for the AbleBaker Book Store, a partnership composed of Frank Able and Susan Baker. Use to find additional instances of index items. Previous Page: 541-Adjusting the Basis of Partnership Property

Example 1065 form completed