Need help with final return for partnership LLC we closed last month before taxes filing

You can actually include January-March 2024 operations on the same return and mark it as a final return. The IRS allows you to file one final return that covers the period from the beginning of your tax year until the date you closed the business. What you'll need to do is file Form 1065 for your partnership and check the "Final Return" box at the top of the form. This tells the IRS this is the last return they should expect from this partnership. You'll include all income and expenses from both 2023 and the portion of 2024 until closure. Make sure you also file Schedule K-1 for each partner, showing their share of income, deductions, and credits for the entire period. Don't forget to check the "Final K-1" box on each partner's form as well.

After reading through all these partnership tax headaches in this thread, I wanted to share something that helped me tremendously when I closed my own partnership last year. I found this AI-powered tool called taxr.ai that actually guided me through the whole final return process step by step. I was also confused about how to handle my final return and short year filing, and I spent hours searching through IRS publications. I uploaded my previous return and closure documents to https://taxr.ai and it analyzed everything and gave me a personalized checklist of exactly what forms to file, which boxes to check, and how to report the income from my final partial year. It even explained all the potential audit flags to watch out for.

I just wanted to update everyone after trying out taxr.ai for my partnership dissolution. I was skeptical at first (as you could tell from my question above), but after struggling with TurboTax for hours, I decided to give it a shot. I uploaded my partnership documents and was honestly blown away by how precise the guidance was. It specifically addressed my short-year filing questions and showed me exactly how to handle the January-March income on a separate return. What impressed me most was that it flagged a mistake I was about to make with asset distribution reporting that could have triggered an audit. Definitely saved me from a major headache! So much better than the generic advice I was finding elsewhere.

If your main concern is getting through to the IRS to confirm you're handling the final return correctly, I highly recommend using Claimyr. I had the same issue last year with my closed partnership and spent DAYS trying to get someone at the IRS on the phone. I finally tried https://claimyr.com and got connected to an IRS agent in about 20 minutes when I had been trying for weeks on my own. You can see a demo of how it works here: https://youtu.be/_kiP6q8DX5c - it basically waits on hold for you and calls when an agent picks up. The agent walked me through the entire process of filing my final partnership return and confirmed exactly what forms I needed.

Ok I need to publicly eat my words here. After posting that skeptical comment above, I was desperate enough to try Claimyr because I couldn't get a straight answer about my partnership's final return anywhere else. I got connected to an actual IRS agent in about 15 minutes when I had tried calling on my own for THREE DAYS with no success. The agent confirmed I needed to file two returns - a regular 2023 return and then a short-year final return for 2024 covering January through closure. She also explained exactly which boxes to check and how to handle the asset distributions to the partners. Just wanted to update since I was so openly doubtful before!

One thing nobody has mentioned yet - don't forget about your state tax filings! Many states require you to file articles of dissolution with the Secretary of State AND file a final state tax return. Some states even have specific forms just for business closures. In my state (California), failing to properly dissolve with both the SOS and the tax board meant they kept charging me the $800 minimum franchise tax even after we stopped doing business. Cost me thousands because I didn't file the proper final return paperwork.

Has anyone here used the IRS free e-file for partnership returns? I know you can e-file Form 1065 but I'm not sure if there are any special requirements when it's a final return with that "final return" box checked. Our partnership was pretty simple with just the two of us and minimal transactions.

Just wanted to add something that might help with your timing concerns. Since you closed in March 2024, you're actually not as pressed for time as you might think. Your 2023 partnership return (covering August-December 2023) is due by March 15, 2024, but you can file an extension until September 15, 2024 using Form 7004. For your final return covering January-March 2024, that would be due by March 15, 2025 (since it's a 2024 tax year return), so you have plenty of time to get that one right. Given that your total revenue was only $8,400 with $7,200 in expenses, you're looking at a pretty straightforward situation. The net income of $1,200 split between two partners means each partner would report $600 on their personal returns. Since the amounts are relatively small, the IRS is less likely to scrutinize the return heavily, but definitely still follow the proper procedures for the final return filings. One tip: keep detailed records of exactly when you ceased operations and any final expenses related to closing the business. These closing costs can often be deducted on your final return.