[Code of Federal Regulations]
[Title 26, Volume 13]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR]

[Page 124-127]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
Procedure and Administration--Table of Contents
 
Sec.  1.6031(a)-1  Return of partnership income.

    (a) Domestic partnerships--(1) Return required. Except as provided 
in paragraphs (a)(3) and (c) of this section and Sec.  1.6031(a)-1T, 
every domestic partnership must file a return of partnership income 
under section 6031 (partnership return) for each taxable year on the 
form prescribed for the partnership return. The partnership return must 
be filed for the taxable year of the partnership regardless of the 
taxable years of the partners. For taxable years of a partnership and of 
a partner, see section 706 and Sec.  1.706-1. For the rules governing 
partnership statements to partners and nominees, see Sec.  1.6031(b)-1T. 
For the rules requiring the disclosure of certain transactions, see 
Sec.  1.6011-4T.
    (2) Content of return. The partnership return must contain the 
information required by the prescribed form and the accompanying 
instructions.
    (3) Special rule. (i) A partnership that has no income, deductions, 
or credits for federal income tax purposes for a taxable year is not 
required to file a partnership return for that year.

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    (ii) [Reserved]. For further guidance see Sec.  1.6031(a)-
1T(a)(3)(ii).
    (4) Failure to file. For the consequences of a failure to comply 
with the requirements of section 6031(a) and this paragraph (a), see 
sections 6229(a), 6231(f), 6698, and 7203.
    (b) Foreign partnerships--(1) General rule. A foreign partnership is 
not required to file a partnership return, if the foreign partnership 
does not have gross income that is (or is treated as) effectively 
connected with the conduct of a trade or business within the United 
States (ECI) and does not have gross income (including gains) derived 
from sources within the United States (U.S.-source income). Except as 
provided in paragraphs (b)(2) and (3) of this section, a foreign 
partnership that has ECI or has U.S.-source income that is not ECI must 
file a partnership return for its taxable year in accordance with the 
rules for domestic partnerships in paragraph (a) of this section.
    (2) Foreign partnerships with de minimis U.S.-source income and de 
minimis U.S. partners. A foreign partnership (other than a withholding 
foreign partnership, as defined in Sec.  1.1441-5(c)(2)(i)) that has 
$20,000 or less of U.S.-source income and has no ECI during its taxable 
year is not required to file a partnership return if, at no time during 
the partnership taxable year, one percent or more of any item of 
partnership income, gain, loss, deduction, or credit is allocable in the 
aggregate to direct United States partners. The United States partners 
must directly report their shares of the allocable items of partnership 
income, gain, loss, deduction, and credit.
    (3) Filing obligations for certain other foreign partnerships with 
no ECI--(i) General requirements for modified filing obligations. A 
foreign partnership will be subject to the modified filing obligations 
in paragraphs (b)(3)(ii) and (iii) of this section if, in addition to 
satisfying the requirements contained in paragraphs (b)(3)(ii) and (iii) 
of this section--
    (A) The partnership is not a withholding foreign partnership as 
defined in Sec.  1.1441-5(c)(2)(i);
    (B) Forms 1042 and 1042-S are filed by the partnership with respect 
to the amounts subject to reporting under Sec.  1.1461-1(b) and (c), 
unless the partnership is not required to file such returns under Sec.  
1.1461-1(b)(2) and (c)(4), in which case Forms 1042 and 1042-S must be 
filed by another withholding agent or agents; and
    (C) The tax liability of the partners withrespect to such amounts 
has been fully satisfied by the withholding of tax at the source, if 
applicable, under chapter 3 of the Internal Revenue Code.
    (ii) Foreign partnerships with U.S.-source income but no U.S. 
partners. A foreign partnership that has U.S.-source income is not 
required to file a partnership return if the partnership has no ECI and 
no United States partners at any time during the partnership's taxable 
year.
    (iii) Foreign partnerships with U.S.-source income and U.S. 
partners. Except as provided in paragraph (b)(2) of this section, a 
foreign partnership with one or more United States partners that has 
U.S.-source income but no ECI must file a partnership return. However, 
such a foreign partnership need not file Statements of Partner's Share 
of Income, Credit, Deduction, etc. (Schedules K-1) for any partners 
other than its direct United States partners and its passthrough 
partners (whether U.S. or foreign) through which United States partners 
hold an interest in the foreign partnership. Schedules K-1 that are not 
excepted from filing under this paragraph (b)(3)(iii) must contain the 
same information required of a domestic partnership filing under 
paragraph (a) of this section.
    (4) Information or returns required of partners who are United 
States persons--(i) In general. If a United States person is a partner 
in a partnership that is not required to file a partnership return, the 
district director or director of the relevant service center may require 
that person to render the statements or provide the information 
necessary to verify the accuracy of the reporting by that person of any 
items of partnership income, gain, loss, deduction, or credit.
    (ii) Controlled foreign partnerships. Certain United States persons 
who are partners in a foreign partnership controlled (within the meaning 
of section 6038(e)(1)) by United States persons may be required to 
provide information

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with respect to the partnership under section 6038.
    (5) Certain partnership elections. For a partnership that is not 
otherwise required to file a partnership return, if an election that can 
only be made by the partnership under section 703 (affecting the 
computation of taxable income derived from a partnership) is to be made 
by or for the partnership, a return on the form prescribed for the 
partnership return must be filed for the partnership. Unless otherwise 
provided in the form or the accompanying instructions, a return filed 
solely to make an election need only contain a written statement citing 
paragraph (b)(5)(ii) of this section, listing the name and address of 
the partnership making the election, and clearly identifying the 
specific election being made. A return filed under paragraph (b)(5)(ii) 
of this section solely to make an election is not a partnership return. 
Thus, such a return is not a return filed under section 6031(a) for 
purposes of sections 6501 (except regarding the specific election 
issue), 6231(a)(1)(A), and 6233. The return must be signed by--
    (i) Each partner that is a partner in the partnership at the time 
the election is made; or
    (ii) Any partner of the partnership who is authorized (under local 
law or the partnership's organizational documents) to make the election 
and who represents to having such authorization under penalties of 
perjury.
    (6) Exclusion for certain organizations. The return requirement of 
section 6031 and this section does not apply to the International 
Telecommunications Satellite Organization, the International Maritime 
Satellite Organization, or any organization that is a successor of 
either.
    (c) Partnerships excluded from the application of subchapter K of 
the Internal Revenue Code--(1) Wholly excluded--(i) Year of election. An 
eligible partnership as described in Sec.  1.761-2(a) that elects to be 
excluded from all the provisions of subchapter K of chapter 1 of the 
Internal Revenue Code in the manner specified by Sec.  1.761-2(b)(2)(i) 
must timely file the form prescribed for the partnership return for the 
taxable year for which the election is made. In lieu of the information 
otherwise required, the return must contain or be accompanied by the 
information required by Sec.  1.761-2(b)(2)(i).
    (ii) Subsequent years. Except as otherwise provided in paragraph 
(c)(1)(i) of this section, an eligible partnership that elects to be 
wholly excluded from the application of subchapter K is not required to 
file a partnership return.
    (2) Deemed excluded. An eligible partnership that is deemed to have 
elected exclusion from the application of subchapter K beginning with 
its first taxable year, as specified in Sec.  1.761-2(b)(2)(ii), is not 
required to file a partnership return.
    (d) Definitions--(1) Partnership. For the meaning of the term 
partnership, see Sec.  1.761-1(a).
    (2) United States person. In applying this section, a United States 
person is a person described in section 7701(a)(30); the government of 
the United States, a State, or the District of Columbia (including an 
agency or instrumentality thereof); or a corporation created or 
organized in Guam, the Commonwealth of Northern Mariana Islands, the 
U.S. Virgin Islands, and American Samoa, if the requirements of section 
881(b)(1)(A), (B), and (C) are met for such corporation. The term does 
not include an alien individual who is a resident of Puerto Rico, Guam, 
the Commonwealth of Northern Mariana Islands, the U.S. Virgin Islands, 
or American Samoa, as determined under Sec.  301.7701(b)-1(d) of this 
chapter.
    (3) United States partner. In applying this section, a United States 
partner is any United States person who holds a direct or indirect 
interest in the partnership.
    (4) Indirect interest. An indirect interest is any interest held 
through one or more passthrough partners, as defined in section 
6231(a)(9).
    (e) Procedural requirements--(1) Place for filing. The return of a 
partnership must be filed with the service center prescribed in the 
relevant IRS revenue procedure, publication, form, or instructions to 
the form (see Sec.  601.601(d)(2)).
    (2) Time for filing. The return of a partnership must be filed on or 
before the fifteenth day of the fourth month

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following the close of the taxable year of the partnership.
    (3) Magnetic media filing. For magnetic media filing requirements 
with respect to partnerships, see section 6011(e)(2) and the regulations 
thereunder.
    (f) Effective dates. This section applies to taxable years of a 
partnership beginning after December 31, 1999, except that--
    (1) Paragraph (b)(3) of this section applies to taxable years of a 
foreign partnership beginning after December 31, 2000; and
    (2) [Reserved]. For further guidance, see Sec.  1.6031(a)-1T(f)(2).

[T.D. 8841, 64 FR 61500, Nov. 12, 1999, as amended by T.D. 9000, 67 FR 
41328, June 18, 2002; T.D. 9094, 68 FR 63734, Nov. 10, 2003; 68 FR 
70584, Dec. 18, 2003]