What must a partnership file annually to report its income and expenses?

A partnership must file Form 1065 annually to report its income, deductions, gains, and losses from its operations. This form serves as an informational return, detailing the financial performance of the partnership for the year. It is important because partnerships themselves do not pay income tax; instead, the income and losses "pass through" to the individual partners who report it on their personal tax returns. By filing Form 1065, partnerships ensure that the IRS is kept informed about their financial activities, and it provides the necessary data for the IRS to track income and tax obligations.

Partnership returns are indeed a requirement, but the specific name for the return that needs to be filed is Form 1065. Other forms mentioned are not applicable to partnerships in the context of reporting income and expenses. For example, Form 1040 is an individual income tax return and not specific to partnership reporting, while Schedule C is used by sole proprietors to report business income, and therefore doesn’t apply to partnerships.