Specific — Instruction 1065 — Instructions for Form

These instructions follow the line numbers on the first page of Form 1065. The accompanying schedules are discussed separately. Specific instructions for most of the lines are provided. Lines that aren’t discussed are self-explanatory.

Fill in all applicable lines and schedules.

Enter any items specially allocated to the partners in the appropriate box of the applicable partner’s Schedule K-1. Enter the total amount on the appropriate line of Schedule K. Don’t

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enter separately stated amounts on the numbered lines on Form 1065; Form 1125-A, page 1; or Schedule D (Form 1065).

File all six pages of Form 1065. However, if the answer to Schedule B, question 4, is “Yes,” Schedules L, M-1, and M-2 on page 6 are optional. Also attach a Schedule K-1 to Form 1065 for each partner.

File only one Form 1065 for each partnership. Mark “Duplicate Copy” on any copy you give to a partner.

If a syndicate, pool, joint venture, or similar group files Form 1065, it must attach a copy of the agreement and all amendments to the return, unless a copy has previously been filed.

Tip: A foreign partnership required to file a return must generally report all of its foreign and U.S. partnership items. For rules regarding whether a foreign partnership must file Form 1065, see Who Must File, earlier.

Name and Address Enter the legal name of the partnership, address, and EIN on the appropriate lines. If the partnership has changed its name, check box G(3). Include the suite, room, or other unit number after the street address. If the post office doesn’t deliver mail to the street address and the partnership has a P.O. box, show the box number instead.

If the partnership receives its mail in care of a third party (such as an accountant or an attorney), enter “C/O” on the street address line, followed by the third party’s name and street address or P.O. box.

If the partnership’s address is outside the United States or U.S. territories, enter the information on the lines for “City or town,” “State or province,” “Country,” and “ZIP or foreign postal code” in the following order: city, province or state, and the foreign country. Follow the foreign country’s practice in placing the postal code in the address. Don’t abbreviate the country name.

If the partnership has changed its address since it last filed a return (including a change to an “in care of” address), check box G(4) for “Address change.”

Tip: If the partnership changes its mailing address or the responsible party after filing its return, it can notify the IRS by filing Form 8822-B, Change of Address or Responsible Party—Business.

Partnerships With Adjustments in the Current Year That Didn’t Result in an IU If a partnership has an adjustment from a BBA audit which doesn’t result in an IU, the partnership shouldn’t take the adjustment into account until the adjustment year (see Definitions, earlier). With its Form 1065 for the adjustment year, the partnership should provide a statement describing the adjustments, including the line numbers to which the adjustments relate, and incorporate those adjustments into its adjustment year return. If there’s a reallocation adjustment being reported on the adjustment year return, ensure the statement identifies the partner receiving the reallocation adjustment. If there’s an adjustment to a separately stated item or to a credit, the partnership must adjust that item or that credit in the adjustment year. See Examples 1 and 2 in Regulations section 301.6225-3.

Items A and C Enter the applicable activity name and the code number from the list, Codes for Principal Business Activity and Principal Product or Service, near the end of these instructions.

For example, if, as its principal business activity, the partnership (a) purchases raw materials, (b) subcontracts out for labor to make a finished product from the raw materials, and (c) retains title to the goods, the partnership is considered to be a manufacturer and must enter “Manufacturer” in item A and enter in item C one of the codes (311110 through 339900) listed under “Manufacturing” on the list, Codes for Principal Business Activity and Principal Product or Service, near the end of these instructions. For nonstore retailers, select the Principal Business Activity (PBA) code by the primary product that your establishment sells. For example, establishments primarily selling prescription and non-prescription drugs, select PBA code 456110 Pharmacies & Drug Retailers.

Item D. Employer Identification Number (EIN) Show the correct EIN in item D. If the partnership doesn’t have an EIN, it must apply for one in one of the following ways.

Online—Go to IRS.gov/EIN . The EIN is issued immediately once the application information is validated.
By mailing or faxing Form SS-4, Application for Employer Identification Number.

An LLC must determine which type of federal tax entity it will be (partnership, corporation, or disregarded entity (DE)) before applying for an EIN (see Form 8832 for details). If the partnership hasn’t received its EIN by the time the return is due, enter “Applied for” and the application date in the space for the EIN. For more details, see the Instructions for Form SS-4.

Note: The online application process isn’t yet available for partnerships with addresses in foreign countries. If you’re located outside the United States, call 267-941-1099.

Item F. Total Assets You aren’t required to complete item F if the answer to Schedule B, question 4, is “Yes.”

If you’re required to complete this item, enter the partnership’s total assets at the end of the tax year, as determined by the accounting method regularly used in keeping the partnership’s books and records. If there were no assets at the end of the tax year, enter zero.

Item J. Schedule C and Schedule M-3 A partnership must file Schedule M-3, Net Income (Loss) Reconciliation for Certain Partnerships, instead of Schedule M-1, if any of the following apply.

The amount of total assets at the end of the tax year reported in column (d) of Schedule L, line 14, is $10 million or more.
The amount of adjusted total assets for the tax year is $10 million or more. “Adjusted total assets” is defined in the Instructions for Schedule M-3.
The amount of total receipts (as defined later in the instructions for Schedule B, question 4) for the tax year is $35 million or more.
An entity that is a reportable entity partner of the partnership owns or is deemed to own, directly or indirectly, an interest of 50% or more in the partnership’s capital, profit, or loss on any day during the tax year of the partnership. “Reportable entity partner” is defined in the Instructions for Schedule M-3.

A partnership filing Form 1065 that isn’t required to file Schedule M-3 may voluntarily file Schedule M-3 instead of Schedule M-1.

Any partnership that files Schedule M-3 must also complete and file Schedule C (Form 1065), Additional Information for Schedule M-3 Filers. See Eased requirements next.

Eased requirements. Partnerships that (a) are required to file Schedule M-3 and have less than $50 million in total assets

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at tax-year-end, or (b) aren’t required to file Schedule M-3 and voluntarily file Schedule M-3, must either (i) complete Schedule M-3 entirely, or (ii) complete Schedule M-3 through Part I and complete Schedule M-1 instead of completing Parts II and III of Schedule M-3.

In addition, partnerships that meet the requirements of (a) and (b) above aren’t required to file Schedule C (Form 1065) or Form 8916-A.

See the instructions for Schedule C and Schedule M-3 for more information.