Well.......the GP is totally wrong. So depending on your current relationship with the GP or what it may be after you inform this individual that they are wrong, you can let them know the following:
- A penalty is imposed on the partnership, rather than the partners, for failure to file a timely or complete Form 1065. This is provided in Section 6698. This penalty is $200 per month per partner.
- The above penalty can be assessed if the return does not provide all the information required by law.
- Section 6031 states "Each partnership required to file a return ....for any partnership taxable year shall (on or before the day on which the return for such taxable year was required to be filed) furnish to each person who is a partner or who holds an interest in such partnership as a nominee for another person at any time during such taxable year a copy of such information required to be shown on such return as may be required by regulations.
- The information required to be shown in item 3 is detailed in the regulations for Section 6031. This is the information provided on Schedule K-1. The penalties for failure to provide this information to a partner is discussed in Section 6722.
If you are not getting the information required to accurately file your personal tax return, you can tell the GP about the penalties above and let this individual know you can certainly let the IRS know about the situation. The penalties are very steep.
*A reminder that posts in a forum such as this do not constitute tax advice.
Also keep in mind the date of replies, as tax law changes.
