Yes, as long as the cash is held in the business name, you have assets equal to the bank balance. Form 1099-INT should be reported as income on the partnership return.
Since you paid the IRS penalties from your own funds, the refunds should have been reimbursed to you. You can empty the bank account by reimbursing yourself for the out-of-pocket payment and distributing the interest according to the partnership agreement. These will be transactions for tax year 2024.
If you have no plans to continue this partnership, you should dissolve the partnership and file a final tax return next year. This will inform the IRS not to expect any more filings from this business.
You may also need to inform your State Comptroller that the business has ended.
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