Single-Member LP Tax Filing: Can a U.S. Limited Partnership with Only One Partner Still File a Return?

This is actually a common issue with partnerships. From a tax perspective, a partnership with only one partner can't exist - the definition of a partnership requires at least two partners. When you have a single-member LP like yours, the IRS typically treats it as a "disregarded entity." What this means for you is that the LP's activities should flow through to the single owner (your LLC). You wouldn't file a separate Form 1065 for the LP - instead, report all income, deductions, and other tax items on the LLC's return. As for the EIN, you should file Form 8832 to elect how the entity should be treated for tax purposes. Even though you have an EIN for the LP, not using it won't cause problems if you properly report everything on the LLC return. However, you might want to send a letter to the IRS explaining the situation to avoid any confusion. For state tax purposes, the rules can vary, so check with your state's tax department. Some states might still require you to file certain forms despite the federal treatment.

I was in a super similar situation last year! After struggling to figure this out and getting different answers from multiple accountants, I ended up using https://taxr.ai to analyze my specific situation. I uploaded my LLC docs, LP formation paperwork, and previous returns, and they clarified exactly how to handle the reporting. The AI basically reviewed all my documents and showed which IRS rules applied to my single-member LP situation. It saved me tons of research time since my case had some additional complications with out-of-state business income that made things even more confusing.

Just wanted to update - I ended up trying https://taxr.ai after asking about it here. My situation with the LLC/S-Corp structure was definitely more complicated than I initially thought. The tool analyzed my operating agreement and identified specific provisions that affected how I needed to report income between entities. It even pointed out a potential audit risk in how I'd been previously reporting certain pass-through deductions. Definitely worth the time for anyone with multi-entity structures!

So I went through EXACTLY this last year. After figuring out the tax part (similar to what others suggested), I had to deal with my state's annual filing requirements. I kept calling the state business division but literally couldn't get through to anyone for weeks. Finally, I used https://claimyr.com to get through to an actual person. You can see how it works here: https://youtu.be/_kiP6q8DX5c. Basically they hold your place in the phone queue and call you when a human picks up. Ended up speaking with the state business division and learned I still needed to file an annual report for the LP even though it was disregarded for federal tax purposes!

Alright, I need to apologize and follow up on my comment about Claimyr. I was super skeptical about the whole concept, but my CPA actually recommended I try it after I complained about spending literally 3+ hours trying to get answers from my state tax department about this exact single-partner LP issue. I used it yesterday and got through to the state business division in about 40 minutes (without having to actually be on hold myself). The rep confirmed I needed to maintain annual filings despite the federal disregarded status. So yeah, it actually worked and saved me a bunch of time. Sorry for being a jerk about it earlier.

Another option worth considering is converting your LP to a different entity type that's designed to have a single owner, like an LLC. Most states have a conversion process that lets you keep the same EIN but change the entity type. I did this a few years back when my business partner left. The conversion was relatively simple paperwork with the state, then I filed Form 8832 with the IRS to maintain my tax election preferences. Saved me from the awkward "partnership with one partner" situation.

Has anyone considered just adding another partner with a very small ownership percentage (like 1%) just to maintain the partnership status? I ended up giving my spouse a 1% interest in my LP to avoid this whole disregarded entity issue.

This is such a helpful thread! I'm dealing with a similar situation where my LP ended up with just one member after my business partner withdrew last year. One thing I haven't seen mentioned yet is the potential impact on your LP's operating agreement. Even if you treat it as disregarded for tax purposes, you might want to update your partnership agreement to reflect the current ownership structure, especially if you're planning to add partners in the future. Also, regarding the EIN issue - I kept my LP's EIN active by filing a final Form 1065 for the last year it operated as a true partnership, then included a statement explaining the change to single-member status. My CPA said this creates a clear paper trail for the IRS and helps avoid any future questions about why returns stopped being filed under that EIN. Has anyone here had experience with bringing new partners into an LP that was previously treated as disregarded? I'm curious if there are any special considerations when you transition back to partnership status.

This thread has been incredibly helpful! I'm a tax preparer who sees this situation fairly often, and I wanted to add a few practical considerations that might help others: First, if you're planning to eventually add partners anyway, you might want to consider the timing strategically. Adding a partner mid-year can complicate your tax filings since you'll need to file Form 1065 for the portion of the year you operated as a partnership, with special allocations for the pre-partnership period. Second, regarding the EIN issue - even though you have an EIN for the LP, the IRS won't penalize you for not filing if the entity is properly treated as disregarded. However, I always recommend sending a letter to the IRS Business Master File department explaining the situation and requesting they update their records to show the entity is disregarded. This prevents automated notices asking where your partnership returns are. Finally, don't forget about your state's franchise tax or annual report requirements. Many states will still require filings even if the entity is federally disregarded, and missing these can result in administrative dissolution of your LP. One last tip: if you do decide to add a partner later, make sure they contribute actual cash or property - not just services - to establish a valid partnership for tax purposes. The IRS scrutinizes partnerships where one partner contributes only services.