What principal business activity code should I use on Form 1065 for my indie video games company?

I'm currently trying to complete Form 1065 for my small indie game studio, and I'm completely stuck on the "principal business activity" section. I've spent hours going through the IRS instructions and checking all the categories, but honestly none of them seem to properly fit what we do as a video game development company. We're a small partnership that designs and sells video games through online platforms, and I'm not sure if we should classify ourselves under information technology, entertainment, or some other category. The codes just don't seem to have anything specific for game development. This is our second year filing, but last year our accountant handled everything. We're trying to save some money by doing it ourselves this time, but now I'm wondering if that was a mistake. Has anyone dealt with this before? What principal business activity code would be most appropriate for a video game development company on Form 1065?

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19 comments

Ethan Clark

As someone who's worked with many tech and creative businesses on their tax filings, I can help clear this up. For a video game company filing Form 1065, you'll want to use code 511210 - "Software Publishers." This falls under the Information sector in the NAICS codes that the IRS uses. While it might not specifically mention video games, this category covers businesses that design, develop, and publish software, which includes video games. The IRS hasn't created a separate category specifically for video game developers yet, so this is the closest and most appropriate match. If your company does significant work in other areas beyond game development (like merchandise or other entertainment products), you might need to consider which activity generates the most revenue and choose accordingly.

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Ethan Clark

Animation studios would typically use code 512110 "Motion Picture and Video Production" if that's your primary business. If you do both game development and animation, you should choose whichever generates the most revenue as your principal business activity. Using a particular business code doesn't directly limit what deductions you can take. Your actual business activities and expenses determine eligible deductions, not the code itself. The code is primarily for statistical purposes and helping the IRS categorize businesses.

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Logan Scott

It definitely works for various business types, not just game development. It analyzes your specific activities and recommends the most appropriate code based on IRS guidelines. For streaming, it would likely help identify whether you fall under content creation, entertainment, or another category. I actually did verify the code with my accountant afterward, and they confirmed it was correct. What impressed me was that taxr.ai provided the exact reasoning and relevant tax guidelines, which made me feel confident even before getting that secondary confirmation. It saved me from waiting on hold with the IRS for hours.

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Lucas Adams

Ok I need to eat my words from earlier! I was skeptical about taxr.ai but decided to try it anyway for my mixed-media art business that includes digital game assets. Uploaded my business description and past returns and it immediately identified the right code AND pointed out that I'd been using the wrong one for two years! It even explained that I don't need to file amended returns just for a business code change. The documentation it provided about my specific situation was really detailed. https://taxr.ai was actually way more helpful than I expected.

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Harper Hill

They use a technology that navigates the IRS phone system and holds your place in line, then calls you when they've reached an agent. It's not special access - they're just automating the horrible waiting process so you don't have to do it. It's definitely not a scam - I was just as skeptical as you at first. The reason it's worth it is simple time value. I spent 4+ hours over two days trying to get through on my own with no success. With Claimyr, I was able to go about my day and got a call when an agent was reached. Whether that's worth it depends on how much you value your time.

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Avery Flores

I need to apologize for calling Claimyr a scam earlier. I decided to try it anyway because I was desperate to talk to someone at the IRS about my partnership's activity codes. It actually worked exactly as described - I got a call back with an IRS agent on the line about 45 minutes after signing up. The agent confirmed that 511210 is indeed correct for video game development and publishing. Saved me an entire day of frustration and I was able to finish my Form 1065 right away. Money well spent.

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Monique Byrd

Just wanted to follow up on this thread since I was in the exact same situation last month. I ended up using code 511210 (Software Publishers) as suggested by Ethan, and it worked perfectly. My partnership return was accepted without any issues. One thing I'd add is that if you're really unsure, you can also look at what code similar businesses in your area are using. I checked with a few other indie game developers in my local game dev meetup group, and they were all using 511210 as well. It seems to be the standard for our industry. Also, don't stress too much about getting it perfect - the IRS mainly uses these codes for statistical purposes. As long as you're in the right ballpark and your business activities match reasonably well, you should be fine. The most important thing is getting your return filed on time!

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