Partnerships and LLCs: Reporting and Procedural Requirements
This practice note covers the major reporting and procedural requirements for partnership and limited liability company (LLC) entities. Even though partnerships and LLCs are flow-through entities that the Internal Revenue Service (IRS) does not tax directly, most of these entities must file yearly informational returns that report the partnership's or LLC's items of income, gain, loss, deduction, and credit. The partnership must also report these items to its partners so that they can file their own federal income tax returns correctly. In addition, partnerships and LLCs have other important procedural and reporting requirements, such as making elections under various Internal Revenue Code (IRC) provisions, which are critical in determining the individual partners' tax liabilities.